June 20, 2005, 12:00 AM

UK web analytics revenues expected to rise 25% this year

The web analytics industry in the U.K. is on the same upward trends as in the U.S. Industry-wide, revenues are expected to jump to £46 million this year from £37 million last year as more business users demand more sophisticated tools.

The web analytics industry in the U.K. is on the same upward trends as in the U.S., with a surge in demand expected to boost revenues this year, to £46 million in 2005 from £37 million last year, according to a new report from U.K.-based web marketing consultants E-consultancy.

According to the report, the web analytics sector in the U.K-like the e-mail marketing sector-is experiencing downward pricing pressure, the prospect of consolidation, and “the emergence of U.S. heavyweights seeking to gain a foothold in Europe.” Demand for more sophisticated analytics technology and increasing use among executives as well as marketers are expected to more than offset any pricing pressure on providers, the report adds.

E-retail, financial services and publishing are the primary market sectors that are investing in web analytics, according to the report, while demand is greatest for later-generation analytics tools that align analytics with business goals. Web analytics business users are seeking insight into customer behavior and revenue paths on sites, beyond the click-through and page view data that characterized earlier analytics tools.

As in the U.S. the rise of search engine marketing is the key driver behind the growth of the web analytics market as marketers upgrade analytics tools to better measure search campaign results. At £37 million, the size of the analytics market remains modest compared with the UK market for search engine marketing, which E-consultancy estimates at £352 million in 2004; and e-mail marketing, estimated at £120 million.

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