web analytics spring 2010

WEB ANALYTICSMarch 30, 2010

NYU Internet Marketing Strategies

Tuesday, March 30, 2010

Goal of Most Marketing Sites

E-Commerce - Amazon, Sephora, Buy.com, Screenstyle

Lead Generation - Insurance, Service Companies, Real Estate

Advertising - YouTube, CollegeHumor.com, HuffingtonPost.com


Web Analytics

Web Analytics Measures the Performance of Your Website and all Online (and perhaps Offline) Marketing and Advertising Efforts

We Measure the Website using KPIs. Key Performance Indicators.


Key Performance Indicators (KPI)

Increasing Number of Visitors

Higher Conversion Rate (Transactions/Visitors)

Increasing Revenue

Increasing Number of Subscribers to Newsletter

Increasing Number of Demo Downloads


Define your goalsI want to get more __________

SalesLeadsEmail signupsPhone CallsViewers


PRR – Project Rate of Return

How much money can you spend on internet marketing to remain profitable?15%? 25%? 10?

For every dollar you spend on marketing efforts, what is your revenue goal?Better than ROI because ROI negates expenses such as overhead, salaries, etc.

PRR is generally determined by Finance but you can use industry best practices also.


AO – Average OrderAverage Order should increase

Raise pricesIncrease average # of items

You may also like:Complementary products e.g. shoes and socks

UpsellFor just $50 more you can double your memory

You can assign dollar values to leads, phone calls, email signups, downloads, etc.


(LV)Lifetime ValueMultiply AO (Average Order) by number of annual purchases and/or length of customer relationship.Big stores like Amazon and Zappos know you’ll probabl come back over and over again. So your lifetime value is high.Hair salons, gyms, yoga studios, and many service companies should also focus on lifetime value.


CPA – Cost per ActionHow much money can you spend for each completed action by a visitor to your website?Multiply LV x PRRExamples: A health club has a 1-year contract of $1000. The average member leaves after 1.8 years so the LV = $1800. The PRR is 15%$1800 x 15% = $270 CPA


ConversionHow many leads out of 100 convert to your goal?100 people click on your display ad. 10 purchase a product. 10% conversion.1000 people visit your site after hearing a radio spot. 10 call you and 1 person becomes a cutomer. 1% conversion.


Cost per LeadHow much can you spend per lead and remain profitable?Multiply the conversion rate by CPA.From an earlier example, the health club has a CPA of $270. If a conversion rate is 10%, then the club can spend $27 for every lead.


AMAT

ACQUIRE VISITORS

MEASURE INTERACTIONS

ANALYZE RESULTS

TEST IMPROVEMENTS


What is the ROI of measuring your ROI?

Assume your site gets 100,000 visitors a month and your conversion rate is 0.5% with an average $ of $200. Your site makes 500 * $200 = $100,000 per month.

Assume you can make changes that raise your conversion rate to 0.7% with an average $ of 220.

Your site makes an average $154,000. Extra $54,000 per month.


Conversions3% Example

Visitors = Potential Conversions

Bounced VisitsNon-Bouncing Visitors

Abandoned3%


Enterprise Leaders

Omniture

Unica

Coremetrics


Small to Midsize Businesses

WebTrends (also Enterprise player)

Google Analytics

Yahoo! Analytics (formerly Index Tools)

ClickTracks


Things that Can Go WrongCode Installed Incorrectly

Firewalls can block tags

Some tags only measure when pages are requested and not when activities are completed.

Corporate sites block cookies

Same visitor logs in from multiple computers

One IP address for multiple persons

Robots can multiply figures

Cookies Expire (long purchase cycle business is skewed)


E-Commerce KPI(How does website perform?)

Visitor Volume

Average Conversion Rate

Average Order Value

Average Per Visit Value

Average ROI

% Revenue from New Visitors

New Customer on First Visit Index


Marketer KPI(How does marketing perform?)

% Visits by Medium Type

% Goal Conversion Rate by Medium Type

% Visits by Campaign Type

%Goal Conversion by Campaign Type

Goal Conversion Index by Campaign

Average ROI by Campaign Type

% New vs. Returning Visitors

% New vs. Returning Customers


web analytics spring 2010

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