September 16, 2004, 12:00 AM

Web analytics shrinks data into more manageable key performance indicators

Gathering information about online customer behavior isn’t a problem—web analytics can capture most aspects of it. It’s distributing analytic data within organizations and making it usable that remains a challenge.

For most companies that operate online, gathering information about customer behavior online isn’t a problem-web analytics can capture most aspects of it. It’s what to do with that data that remains a challenge. A surprisingly large number of companies that do business online don’t distribute data generated by their web analytics to key departments that could use it, according to a report by Jupiter Media, “Key Performance Indicators: Using Analytics to Drive Action.”

Only 19% of the companies surveyed-a group spanning companies in industry sectors including retail-regularly distribute analytic data to merchandising departments for review. Only 53% of companies polled by Jupiter said their marketing team reviews analytic data, and only 41% of them said executives review web analytic data.

“Most companies fail to distribute key web metrics frequently, deeply, or broadly enough to appreciate their full benefit,” the report found. To resolve this issue, and shrink the volume of data generated by analytics into something more concise, easily understood and easily distributed, Jupiter suggests framing it for company departments that need to see it as key performance indicators. Some web analytic vendors already offer reporting in this format, according to Jupiter; others are moving to add it.

Key performance indicators are regularly distributed data that provide metrics specifically selected to illustrate aspects of site performance against specific business goals. “KPIs-key performance indicators-bridge the gap between volumes of data and specific business objectives,” according to Jupiter. Critical to their successful use is frequency of distribution, which Jupiter describes ideally as “enough frequency to observe critical changes, while avoiding data deluges in employees` inboxes.” Another important factor is how KPI data are presented to employees; Jupiter identified best practices on presentation that include the incorporation of visual cues with text and numbers.

More than half of the companies surveyed by Jupiter plan to invest in new or improved web analytics in 2004. Broadening internal distribution of analytic data formatted as KPIs would help companies maximize that investment, contends the Jupiter report, which adds that KPIs facilitate “the transfer of information from technical resources tasked with keeping services up-including analytics applications-to business owners who must continue to improve results.”


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