A well-managed digital analytics strategy can deliver powerful insights with actionable steps to run your business successfully. Using analytics, we can analyze behavior of visitors to a site, understand the source of these visitors, optimize ecommerce or subscription funnels, determine the ROI of marketing spend and measure results of A/B tests.
The landscape of digital analytics is rapidly changing. It’s becoming more and more difficult to figure out the vendor landscape as they jockey for position. We’ll take up this changing landscape in subsequent posts and position papers. The important takeaway for this post is that a Digital Analytics Strategy built for the long haul will allow you to keep your sanity and remain successful through all of the changes ahead.
1. Establish the Primary Objectives and Goals
The first step is always to know where you’re going. So examining your company’s goals and objectives at the highest level and considering how these tie to your organization or division goals is critical for alignment. As examples, your objectives could include:
- increase sales revenue for products or
- improve conversions across different channels or
- increase visitor retention and improve customer satisfaction.
These objectives should give you a sense of what your KPIs are in the next step (and in some cases, your objectives will be your KPIs). But it’s important to understand that this is a business conversation before it is an analytics conversation. Don’t jump too quickly to analytics yet.
For example, understanding “customer satisfaction” is more about understanding how customers use all of the channels of your company than isolating your focus on a single channel. Satisfaction is increasingly becoming about your ability to deliver a relevant, personalized experience regardless of channel.
2. Develop Key Performance Indicators (KPIs) to Measure Business Goals
KPIs help you measure success against your business goals and objectives. In terms of analytics, each of these goals would be tracked and tagged using custom events, campaigns, goals, and funnel tracking. Typically, as an analytics deliverable for this stage, a concise Key Business Requirements (KBR) document is prepared and reviewed with stakeholders. This document will guide how websites, campaigns and mobile apps are tracked with analytics to ensure that the data captured ties directly to the business goals and objectives.
KPI’s have a hierarchy. At the top level, you want as direct connection with your goals and objectives as possible – customer sat, revenue, lead generation. Then you can start to break down your KPIs into channel-specific measurements that are actionable.
As an example, if you are responsible for increasing lead generation by 5% this year, and you have multiple channels that are supposed to deliver leads, you want to make sure you understand how each channel can contribute to this goal. Your Analytics Strategy (the next step) is going to define how you want to measure each channel.
For a website, specific KPIs could include:
- Conversion Rate: For a lead-generation site, this means that the visitor initiates some contact from the website – form submission, chat session, or a phone call. Make sure you understand what pages and paths drive the highest conversion.
- Form Abandonment Rate: Measures how many visitors began to complete the form but did not finish it. This metric will help us to optimize the form to maximize entries by identifying struggle points for visitors and testing alternative approaches.
- Engagement: Typically this is a combination of time on site, page views per visit, and frequency/recency of visits. Higher engagement should lead to higher conversion.
For a campaign that channels your prospects through the website, your KPIs could include:
- Click-through Rates: For each landing page or banner, how many visitors actually ended up clicking through to your site or otherwise taking the action you wanted from them?
- Cost per Visit: How much did you pay on average for each new visitor to your site? As an effective conversion metric, you can use this metric to measure campaigns against one another or between different channels.
- Visitor-to-Lead Conversion: Of the visitors who came to the site, at what rate did they convert – i.e., make contact with your company for a sales opportunity?
Typically, as an analytics deliverable for this stage, we develop a KPI handbook document and also a Solution Design Reference (SDR) that highlights the specific KPIs and categorizing these metrics as events, conversion or traffic variables.
3. Setting Targets and Defining Funnels
Frequently, in the initial stage of a project we use an “Analytics Plan” to facilitate the conversation between the business stakeholder, the development resource and the reporting analyst ensuring that all critical user actions can be tracked effectively. The Analytics Plan is visual and allows everyone to consider what user flows are important and ensure that these elements are tagged so that there is alignment between the business owners’ goals and report needs and the technical solution that is being implemented.
Where necessary, we create funnels with the website data to ensure an easy and accurate view into what steps are causing fallout and again enabling a discussion with all stakeholders around what actions to take with these new data insights. If your goal is to increase product sale conversion rate, then tracking the pages that the customer passes through to get to the final order confirmation page will provide valuable analytics information about where users are entering and dropping off before completing their orders. Funnels give businesses crucial information data into potential user experience or technical flaws in the product order process.
Once the metrics have been determined, it is then important to set targets/benchmarks that put your website’s goals into perspective. Hence, addressing the KPIs with suitable tagging and tracking framework on the site will empower you to measure the success of your goals across different time-periods.
If we apply Targets to our previous KPI examples, we would set benchmarks per industry research as follows:
- Form abandonment rate < 8%
- Cost per lead < $4
4. Data distribution and Automation Strategy
A key to ongoing success and maintenance of data is to ensure that you have thought though how you are going to distribute meaningful data to key stakeholders throughout the organization. Do you want to train them to pull their own reports? Do you want to schedule weekly or monthly dashboards through email? Automate reports so that analysts can focus their time more on insights instead of report delivery? Are insights being applied and is the data being used to support decision-making or are reports circulated and ignored in over-crowded in-boxes? Understanding the answers to these questions will help unlock a strategy for data distribution that ensures data is enabling decision-making and moving the organization forward.
5. Data Visualization
Data Visualization with tools like Tableau, Qlik and Adobe’s Data Workbench, are becoming more critical to effective analytics programs. They are key tools to breaking down analytics siloes and being able to look at fuller pictures of what is going on. They do a much better job of presenting customer journeys.
For example, you can line up your channel-specific KPIs to show how changes in one are leading to changes in others. Without this ability to combine and visualize data sources, you’re left with piecing a story together with different tools. Your campaign tracking tool might tell you about conversion rates for each campaign, but that’s only part of the story. How many of those leads became customers? Data viz and data integration give you the power to weave the whole story together.
6. Site Optimization
Additionally, you should continually monitor conversion rates across channels and improve the overall experience for prospects and customers. This can be accomplished by implementing optimization techniques that are tied to the KPIs of a specific channel, but (if you’ve done your homework) also contribute to the top level KPIs.
At Numeric Analytics, we have specific practice areas with years of experience dedicated to help our clients solve complex marketing challenges, improve and create efficiency and insight into the full marketing and sales cycle from acquisition to retention.
Further Reading
If you’re interested in Analytics Strategy:
Does Your Analytics Program Lack Creativity?
If you’re interested in Data Visualization:
Tableau vs. Excel – How do you know if you need to make the switch?
Data Visualization – Seeing the Forest and the Trees at the Same Time
If you’re interested in Conversion Rate Optimization:
Six Best Practices for Maximizing Conversion Rates
If you’re interested in Optimization:
