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10 Actionable Web Metrics You Can Use – Part 2 January 13, 2010

Posted by Joe Kamenar in web analytics.
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In Part 1 of this post, I discussed 5 percentage-based metrics that can provide actionable insight. In Part 2, I will go over 5 index-based metrics that can also provide insight to problems that may need to be addressed in order to maximize the value of your website.

1. Campaign Quality Index (CQI)

This index measures how well targeted your campaigns are at driving qualified traffic to your site. Suppose 40% of your traffic comes from a particular campaign, but the traffic only provides 20% of your overall conversions. The CQI for this campaign would be the percent of conversions from the campaign (20%), divided by the percent of visits from the campaign (40%). A value of one means that a visitor from this campaign is as likely to convert (purchase, sign up, request information, etc…) as from any other campaign. A value less than 1.0 means they are less likely to convert, while a value greater than one means they are more likely to convert. If the value is less than 1.0, then you need look at the reasons. You can break this down to individual search engines, or even keyword groups for each search engine, and for each individual banner campaign or other paid campaign you use, including referral partners. Perhaps the targeting is not sufficiently narrow, or the message is not being carried through the site (high bounce rate). You will want to work with your SEM team and landing page design team to make the needed changes. When you make improvements, you can track their effectiveness by watching the index change. Ideally, your analytics dashboard should be created so that you can see the changes over periods of time.

2. New Customer Index (NCI)

This index is focused on transactions (not revenue) from new customers. It is defined as the percent of transactions from new visitors divided by the site percentage of new visitors. For example, if 40% of your transactions are from new visitors, and 60% of your traffic is from new visitors, your New Customer Index is 0.67. A value of 1.0 means that a purchase is equally likely to come from a new or returning customer. A value less than one (as in this example), means that a new visitor is less likely to become a customer. A value greater than one means that a new visitor is more likely to become a customer than a returning visitor. Your goal is to strive for a value of one or better. If the value is less than one, you will need to look at factors that contribute to a low value. To do this properly, you would want to create a New Customer Index for each type of campaign you run, and compare that to those who come to your site from direct entry. A low performing index for paid search or banner campaigns can mean that you are not targeting the correct market, or that your search terms are not correlated to those looking to purchase your product or service. If the campaign is a banner campaign, either the message is not on target, or the media partner you are using is not attracting the correct demographic.

3. Return Visitor Index (RVI)

This index is simply defined as the percent of return visitors divided by the percent of new visitors. A value of 1.0 means that your site has an equal distribution of new vs. return visitors. A value greater than 1.0 means that your site is more likely to attract return visitors, while a value less than 1.0 means your site is more likely to attract new visitors. Depending on your type of site and your effort on attracting new visitors or keeping existing visitors, you can see how effective your efforts are and can then focus on how to improve this index. If your goal is to encourage repeat visits, then you need to be concerned with how fresh or relevant your content is, or how effective any email campaigns are in getting registered visitors to come back to your site. Any anomalies need to be investigated. As an example, I once saw a huge jump in new traffic in a client’s site that was the result of an email campaign, according to the analytics report. However, the email campaigns were only to registered visitors, so in order to have received the email, you would have first had to have visited the site. Thus, the email campaign visits should show up as return visitors. What happened is that the email contained an offer for a free exercise DVD, and the link URL was hijacked and placed on a few deal sites. When visitors clicked on the link, they were attributed to the email campaign, as the link contained the email campaign code! By looking at the RVI, I was able to see that there was an issue that needed to be addressed.

4. Branded Search Index (BSI)

Organic search can consist of generic terms that relate to content on your site plus searches that include your company name or your brand name.  Each can be of interest to your search manager. If more visitors come to your site from generic keywords or terms, it means that your site is well optimized for content. If more of your search visits come from branded terms, it means that more people are finding your site by your brand name instead of from non-branded terms.  You can track this by creating a BSI metric. This is defined as the percent of visits to your site from branded terms divided by visits from non-branded terms. Values greater than 1.0 mean that you are getting more of your traffic from branded terms, while a value less than 1.0 indicate that generic terms are winning the organic search battle. Depending on your search strategy and goals, you can use this information to help adjust your optimization or brand promotional efforts.

5. Site Search Impact (SSI)

Site search is very important for many types of sites. Visitors who come to your site may use site search to help them quickly find what they are looking for. If they find what they want, they may be more likely to continue to reach a goal, such as a purchase or lead submission. If they don’t find what they are looking for, they may just leave the site. The SSI index can tell you the impact your site search has on your revenue. To calculate it, take the per visit revenue from those who use site search, and divide it by the per visit revenue of those who do not use site search. “Per visit” revenue is defined as the total revenue or lead value for the month, divided by the number of visits. If your SSI index is greater than 1.0, this means that your site search is making you money, compared to those who do not use search. If the index is less than 1.0, it means that your site search is costing you money, meaning those who use site search are less likely to either make a purchase or become a lead. This can be the result of not getting desired results from the search, or result pages that don’t satisfy your visitors’ needs. To solve this problem, you would then need to dive deeper into your site search report to identify and correct the issues.

Hopefully this two-part post on 10 actionable web metrics you can use has given you some insight into how to make your web analytics program more actionable. While some of these metrics are fairly easy to construct, others may require filtering, segmentation, calculated metrics and integration with offline data. Depending on your analytics tool, you may want to use a presentation package like Xcelcius to create and display your gauges and create a dashboard. Edgewater Technology can help you develop an actionable analytics program based on the goals of your company, and can create the appropriate tagging and reporting strategy that will let you see your actionable metrics at a glance. Contact Edgewater today to learn more about how we can help you get more out of your web analytics program.

10 Actionable Web Metrics You Can Use – Part 1 January 13, 2010

Posted by Joe Kamenar in web analytics.
Tags: , ,
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The end goal of a web analytics report should be to provide some guidance on how to take an action to improve how your website is meeting its goals. However, many analysts simply generate canned reports using their analytics tool and send it to their management for review. In this two-part post, I will share with you 10 different web metrics that can “at a glance” tell your management how well a particular campaign or goal is performing, plus provide some relevant actions that can be taken to improve the underlying performance of the metric.

In Part 1, I will look at five metrics that are expressed in percentages. In Part 2, I will look at five metrics that are expressed as an index. Ideally, these metrics would be designed to be seen as gauges on a dashboard, and some can have the ranges color-coded (green/yellow/red) to quickly show the impact of that metric. Here are the first five actionable metrics.

1. Campaign Margin.

If you are running any paid campaigns for an ecommerce site or lead generating site, you need to know your margin. In simple terms, your campaign margin is defined as your revenue from a campaign less its cost, divided by the revenue. Your goal is to stay as close to 100% as possible. You can create a report that shows the campaign margin for any campaign that involves external spend (banners, paid search, sponsorships, etc…), or an internal spend on employees’ time (social media marketing, forum and article posts, etc…). The smaller your margin, the less money you are making. With this metric, “0%” is breakeven. If you have a negative margin, you are losing money on that campaign. If you have a positive margin, you are making money. This type of margin can be shown as a gauge and placed on your analytics dashboard. If your margin is negative or near zero, you need to take action to look at why the campaign is costing so much or how you can increase the campaign’s effectiveness.

2. Percent Revenue from New Visitors.

This metric tells you how likely visitors are to order from you on their first visit, compared to ordering on successive visits.  In order to create this metric, you need to be able to segment your traffic by new vs. repeat visitors. To calculate the metric, take the revenue generated from new visitors and divide it by the total revenue.  If the percentage is more than 50%, you get more of your sales from first time visitors, If it is less than 50%, you get more orders from repeat visitors. If you see this percentage is low and you have limited repeat buyers, then perhaps you would want to do a better job to get a visitor to purchase on their initial visit. If you have a low percentage of revenue from new visitors, and you have a more expansive product line, then this metric is telling you that you get more of your sales from repeat visitors or customers, and you may want to focus on keeping your content fresh and maintaining campaigns such as email or social networking to keep your visitors coming back.

3. Engaged Visitor Percentage (EVP)

This metric is defined as the number of visits that contain an action or event that indicates engagement divided by the total number of visits. To use this metric, you must first determine what defines an engagement. This can be any of the following – visit a specific number of pages, visit particular pages of interest, subscribe or register to something on your site, post a comment, rate something, click on an ad, use a tool, navigate a map, download something, play a video, forward to a friend, or do anything else you wish to show engagement. By monitoring this metric over time, you can determine if your site is doing a better or worse job of engaging your visitors, if this is one of the goals of your site.

4. Utilization Factor (UF)

Some types of organizations have developed their website to encourage its users to conduct business through it instead of calling or submitting paperwork. For example, an insurance company may want claims to be processed via the web. A financial agency may want its brokers to process transactions via the web instead of sending in forms. If one of your goals is to encourage the use of your site to accomplish tasks, one way to measure this is to track the percentage of activities that are conducted on the web divided by the total number of activities conducted online and offline. This metric is a bit more complicated, as to do it entirely online you need to import the offline data into your web analytic program. You can also export the online data and create an Excel-based report that combines the online and offline data. Your UF can also be used to measure the percent of registered users who use the site to transact business. By monitoring the Utilization Factor over time, you can determine how well your efforts are to shift your transactions to the web. Specific actions can include training of your users on how to use your site to process transactions, or ongoing communications that remind your users to use the site.

5. Self Service Factor (SSF)

If your site is to be used to provide customer service, one of your goals could be to reduce the percent of customer service issues that are handled through the phone. Thus, the SSF would be calculated as the number of service issues that were resolved on the web divided by the total number of service issues (web + phone + chat + email). In order to do this, you would either need to import your offline data into your web analytics program, or export your online data into a spreadsheet to combine it with your offline data. If your company has a target goal for resolving service issues via the site, you can create a gauge that shows how well the actual percentage is compared to the goal, or color-code the result as red or green to show if the SSF is above or below the target. Part of your site’s optimization efforts would include analyzing the issues that are most often called in and updating the content on the website, or making the top 10 most frequent issues a sidebar on the customer service site.

In Part 2 of this article, I will show you how to use these five additional actionable metrics:

  • New Customer Index
  • Campaign Quality Index
  • Return Visitor Index
  • Branded Search Index
  • Site Search Impact