Focus Your 2005 Web Analytics Spending

Jason Burby

Updated · Feb 01, 2005

A recent Forrester report, based on a survey of 176 companies with $500,000 in yearly revenue, reveals 54 percent of respondents plan to spend more on Web analytics this year. Though more companies understand the value of Web analytics data, many are still unsure how best to spend analytics dollars.

There are a number of ways to increase analytics budgets, ranging from tools and hardware to configuration services and data analysis. Below, ways to spend these dollars and how to allocate the additional resources.


Tools are usually the first thing people think about spending an analytics budget on. High-end Web analytics tools available from the big four providers (WebTrends, Omniture, WebSideStory, and Coremetrics) are quite sophisticated. Actual use of the data these tools deliver is still in its infancy, however. Too often, the tool is blamed for the failure. If you're using a top-tier solution from one of the big four, failure isn't usually the tool's fault.

The big four base their cost structure on page views, so cost grows as traffic rises. Use data from the tool to tune your site and increase conversions to offset the price of increased traffic.

Do upgrade to a top-tier tool if you've clearly defined your goals and an entry-level tool can no longer provide the data you need to make decisions.

Don't focus all your attention on the analytics tool or blame that top-tier tool if you don't act on the data. Spend time evaluating tools until you clearly define (and document) both site goals and supporting metrics. This will help you understand what you need to know about desired visitor behaviors and how you can use the analytics data to affect them.


Since three of the big four are ASPs (WebTrends offers WebTrends 7 as software and on-demand), this is less an issue than it was in the past. If you use a software solution, run it on the appropriate hardware. Also, balance the need for processing the report in three hours, versus 20 minutes in the middle of the night. If no one looks at the report before 5 a.m., funds may be better spent in areas other than a hardware upgrade.

Do make sure you run the software on sufficient hardware so users can get the data in a timely manner and aren't limited by technical issues.

Don't overspend on hardware when resources are better spent in other areas.

Maintenance and Configuration Services

Continually tuning your analytics tool is very important as a site changes and new content is rolled out. Resources are often budgeted for this when a tool is first acquired, but you must also address ongoing configuration, tool management, and site changes.

Do budget for fine-tuning the tool as the site changes and accuracy issues arise.

Don't assume these issues will take care of themselves. Most of our new engagements begin months after a new tool is implemented. In many cases, so much has changed on the site since the initial configuration that things are being tracked incorrectly. It starts with just a few minor things, but they add up. This can cause significant problems if ignored.


When used with an appropriate methodology, analytics data can yield incredible results and often pay for itself very quickly. When combined with other data, it can become so much more valuable.

Do look for opportunities to combine analytics data with other informational sources from within your organization to see a more complete picture. Consider integrating it with the following data types:

  • Usability
  • Competitive intelligence (comScore, Hitwise, etc.)
  • CRM (define)
  • Surveys
  • Call centers
  • Partner data
  • IVR (define)
  • Other behavioral information

Don't look at Web analytics data with blinders on. You'll only see part of the picture.

Analysis and Action

Analysis and action are the two most neglected aspects of Web analytics. Companies typically focus their resources on tools and hardware and fail to analyze and use the data to improve site performance. Until you can use the data to identify and improve underperforming site areas, your Web analytics strategy's return on investment (ROI) will be zero.

You can analyze data several ways. It's up to you to decide whether you'll use someone in-house who has experience analyzing this type of data and identifying opportunities for improvement or else work with a third party to analyze the information. Many of our clients do both: they have an internal business analyst and hire us to help build and train the team, as well as provide best practices and ongoing support. No matter what you do, focus resources on the analysis and action steps.

Do allocate a percentage of overall resources to identify and act on the data your Web analytics tool churns out. Make this a priority! Monetize the effects and prioritize these findings to ensure you focus on the right things.

Don't overlook these areas and just continue collecting data.

Make it a goal to pay for all of your analytics resources 10 times over this year through site-performance optimization. It's entirely possible. Once you get started, you'll realize this is how to approach site improvements.

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