February 21, 2013, 11:21 AM

‘Funnels’ help an e-retailer learn more about its online marketing

Cat5 Commerce uses a newer Google Analytics tool to improve search.

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Google Multi-Channel Funnels, an analytics tool, is starting to help Cat5 Commerce get a more detailed view of how well its marketing dollars are being spent, says Andrew Hoefener, the e-retailer’s co-founder and chief operating officer.

The tool, introduced in 2011, is a feature within Google Analytics that enables retailers to determine how much each form of marketing they use contributes to a sale. That lets retailers form a more precise view of which paid search and display ads, social network posts, e-mails and affiliate marketing links helped to produce a conversion, and that helps direct marketing investments. Google Analytics is used by 163 of the retailers in the Internet Retailer Top 500 Guide and 300 in the Second 500 Guide to gauge such e-commerce essentials as where site traffic originates and conversions, among other metrics. The base Google Analytics service is free; a premium version costs $150,000 a year.

“Effective attribution modeling is a challenge, but it's essential as customer touch points grow and our marketing efforts cross channels,” says Hoefener, whose 8-year-old company sells such products as gun accessories, hunting gear and work boots. “Without an effective model, you run the risk of calling something a failure that is actually contributing key conversion assists. I wish I could tell you that we have this nailed, but it's something we're grappling with.”

Early experiences with Google Multi-Channel Funnels have helped Cat5 Commerce realize savings and lessons that could lead to more sales this year. “The channel we seem to have most undervalued is organic search,” he says. “Certain paid search head terms may be playing more of a support role in the conversion funnel, and we’re in the very early stages of further analysis and bid experimentation.”

He says Multi-Channel Funnels has provided valuable information about  marketing programs. For instance, the e-commerce company, which operates TacticalGear.com, recently learned it was overrating the worth of the paid search term “tactical gear.” “We now believe we were overvaluing those clicks by 35% by 40%,” he says. “The potential savings from that single insight could be worth tens of thousands of dollars.”

For more about how new e-commerce technology and services are helping e-retailers to gain a wider view of their online marketing efforts, please check out the April issue of Internet Retailer magazine.

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