What Should You Measure? Part 2: Online Media
So much data, so little time. How do marketers determine what to measure for their online businesses? Part two of a series.This is the second in a series aimed at that frequently asked question: What should I measure for my online business?
My last column covered e-commerce metrics. We heard from folks in the trenches about which stats are mission-critical and why. This week, we move to online media, where answers are very different.
To refresh your memories, our e-commerce colleagues share a focus on daily revenue. Whether studying real-time revenue to capitalize on emerging opportunities or reviewing click streams for prior sales, it all comes down to customers, revenue, and profit.
Online media sites must tell a different story. Yes, revenue is important. But for those I spoke with, revenue isn't the best indicator of how the site's performing. It's all about traffic.
I asked Peacock how he chose traffic as the most important data to monitor. After all, our e-commerce brethren unanimously chose revenue. Said Peacock, "Lyndon B. Johnson spoke the truth where we're concerned: 'A rising tide lifts all boats.' Traffic drives all three sources of revenue for us: advertising revenue, data downloads, and even magazine subscriptions. When we get the traffic, the revenue follows."
Peacock conducts periodic, in-depth reviews of the data with a longer-term focus. He watches month-to-month and year-to-year trends to determine which site areas are working and which aren't. There have been some surprises. "The Fortune 500 list is released each April, so of course we expect a spike in download revenue then. We've learned over time that people keep coming back for that dataset throughout the year. The traffic it drives is a constant opportunity to increase interaction with the site."
Marea Battle, spokesperson for CNN.com, said the news site focuses on traffic statistics as well. She names page views as one of the best user satisfaction indicators for CNN's content.
The traffic theme was repeated in my discussions with other online media companies. Page views, unique visitors, session lengths... these folks focus on data that helps them determine whether they get people in the door and engaged with the site. I repeatedly heard those two elements propel the revenue.
It's tempting to conclude all e-commerce companies focus on revenue-related data and all online media companies focus on traffic data. Don't oversimplify. There are so many variations in the actual pieces of data used, under the umbrella of "revenue" or "traffic," it would be short-sighted to stop there.
Determining what to measure is still dependent on subtle differences in business plans and strategies and the role of the Web site in the overall business. It's worth noting CNN's Battle finds page views to be most informative, while Fortune's Peacock adds traffic source to the list. There's no single statistical set that can meet every company's (or every employee's) need.
Lori Heinsman is senior project manager at Enterpulse, a professional services firm that applies Internet technology and serves clients in a variety of industries. She knows firsthand there's no cookie-cutter solution to determine data needs. Part of Heinsman's job is to help clients establish the metrics to measure success and help them obtain the necessary data.
"Business needs vary, therefore measurement needs vary," she told me. "Determining what's most important to measure is proportional to defining the client's business objectives." Heinsman offers a key piece of advice (which I support wholeheartedly, having learned the hard way): "The most efficient and effective reporting strategies are addressed in the planning stages of the project. So many companies miss this opportunity. It can become an expensive mistake."
What? Another aspect to consider in the already complex world of Internet metrics? Right. There's no reason for marketers to fly blind as far as the Web is concerned, yet many do. A primary reason is because reporting needs weren't considered when the site was developed. Definitely food for thought.
Next, we'll look at a more real-life examples of business decision makers and the metrics they use most. By now, you should be examining your own needs, based on your specific business goals and your role in the company.
Melaney Smith is a freelance marketer with more than ten years of experience in marketing, finance, and data mining. She evangelizes the need for businesses to mine their data and make it easily accessible for decision makers. She specializes in helping businesses utilize customer, transaction, and other data to improve or create sales and marketing programs.