Understanding Web Analysis
Web analytics can be really, really cool. But you have to understand what its limitations are and how to use it.
Let's give an example: a good web analytics tool is like a powerful microscope. Not like one of those cheap microscopes you used in elementary school to look at thread. It's like one of those neat scientific microscopes you see in labs on CSI. Now, as neat as an expensive microscope is, it won't do you any good if you're trying to watch a comet. For that matter, it won't even show you what's across the room.
Web analytics tools are limited. They are designed to measure only certain types of data. This data can be really useful if you know what you're doing. If you don't, it can be useless. Like trying to view a comet with a microscope.
What it is
What exactly does a web analytics tool measure? To put it simply, it gives you an estimate of what happened on a website.
With few exceptions, web analytics tools only capture most of the activity on a website. Generally, the sample is quite high, like 95%, but it is only a sample. A survey, if you will.
In short, some visits are missed, some are misrepresented, some data is flat wrong. And there often isn't a way to discern which pieces are wrong or missing.
What it isn't
Hopefully you can see now why web analytics tools cannot be used as accounting tools. That is, unless you enjoy the adventure of never knowing exactly how far off your reported revenue is from reality.
Web analytics reports also are not a census of your visitors and their demographics. There is very little demographic information that can be gathered without the visitor explicitly giving it to a website.
Finally, web analytics is not a crystal ball. It doesn't read minds. It can't tell you why a visitor did something. It can only tell you what they did.
Web analytics tools spot trends and correlations rather than exact figures, and are excellent at helping us evaluate the impact of both the site itself and the marketing initiatives that bring visitors to the site. If you can identify the visitor actions that indicate a successful visit and then tie that to their original traffic source, you can go a long way in evaluating what works and what doesn't work.
Web analytics is good at identifying the roadblocks to conversion. Which pages on the site have a high abandonment rate? Which seem to be most influential? Which marketing sources bring only confused visitors? Which pages send all your visitors to the contact page to write nasty emails?
Remember: web analytics tools are intended to give you a big picture of what is happening on your site.