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The importance of Web analytics in eCommerce

May 10, 2005

Building an eCommerce site and simply supporting it with just a search engine marketing campaign isn't enough anymore. To get the real story, a site owner or webmaster needs to complement it with powerful Web analytics tools.

That's the message coming out of a number of panels at the Search Engine Strategies (SES) show that wrapped up here this week. Experts contend that Web analytics are the key to ensuring online success as well as helping to prevent online fraud.

Vendors touted their respective benefits on the various panels and in the exhibit hall and seminar audiences repeatedly asked panelists about various metrics. Perhaps most astonishing to many SES attendees was the assertion that analysis of various Web metrics can also help to identify click fraud.

Click fraud is a growing concern for both advertisers and search engines and is considered to have occurred when a "non-human" (via an automated hitbot) click occurs on an on a cost-per-click (CPC) ad. Click fraud can be perpetrated by malicious competitors as well as disgruntled former employees among others.

Jessie Stricchiola, founder of Alchemist Media, explained in a number of case studies how she used Web analytics to locate and identify click fraud on her client's sites. The techniques involved finding abnormal traffic spikes and repeated sequential hits from the same IP. She strongly encouraged the audience to audit their own traffic with some form of analytic tool since the burden of proof when it comes to proving click fraud is on the advertiser and not the search engine.

Stricchiola stressed that currently advertisers have only 60 days in which to file a claim with a CPC engine and that the advertiser must provide documented proof (which a Web analytics tool can help provide) if they hope to get a refund. Among the advanced Web Analytics techniques discussed over the two day SES event was a technique called dayparting. Similar to broadcast advertising, dayparting involves varying search engine CPC bids depending on time of day in order to maximize effective ad exposure as well as conversions.

Michael Sack, Chief Technology Officer at Web analytics firm Inceptor, explained that it makes sense to take advantage of dayparting when certain conditions exist. Those conditions include competitive market conditions, limited sales windows, identifiable demographic targets by time, business capabilities and when you can detect patterns in conversion/ROI rates.

"You may end up getting less traffic but it will be more relevant traffic," Sack told the audience.

According to Sack, dayparting can provide a significant bump in return on investment for advertisers. However in order to really benefit from dayparting you need to be able to plot performance versus time and detect patterns that suggest bidding behavior, which is where some time of Web analytics tool comes into play.

At a panel titled "Measuring Search Marketing Success," representatives from analytics vendors ClickTracks, Google's (Quote, Chart) Urchin, WebSideStory and WebTrends all touted their respective solutions' benefits. Almost unilaterally each company representative noted that usability improvements as well as browser overlay (that is the ability to view the analytics information overlaid on top of the browser Web page that is being analyzed) as two of the top items users should look out for.

Web Analytics tools range in price and features. But for those who want to do basic Web analytics on the cheap, there is an easy way. Findmefaster president Matt Van Wagner, reminded the SES audience that both Google and Yahoo Search (Overture) (Quote, Chart) provide free tools that show advertising performance data. Van Wagner demonstrated however that the data in and of itself, which is provided in tabular format really is difficult to examine and analyze in its raw form. He suggested that users export the data from Google and/or Yahoo! into Microsoft Excel (Quote, Chart) to create charts and visualize the data.

The question of whether a users' server installed analytics tool or a remotely hosted solution was best was also addressed at SES.

"It doesn't matter since both methods are inaccurate," John Marshall CEO of told the audience. "They're just inaccurate in different ways."

According to search engine marketing firm Future Now, it doesn't really matter which Web analytics tool you use. Co-founder Jeffrey Eisenberg explained that his firm had improved its clients search marketing ROI with tools and techniques that were familiar to Web analytics tools from seven years ago.

"You just have to choose something," Eisenberg said. "It's better to have something that is working that is good enough than not having anything working at all."

Source: eCommerce Guide

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