Google Analytics has opened up the world of web analytics to a host of new users, so we thought it might be worth running over some of the basics of why people use web analytics. After all, there’s not a lot of use in slaving over a hot keyboard for weeks to configure your analytics only to sit back, look at your perfectly formed data and suddenly realise you don’t know what to do with it now that you have it.

So welcome to the concept of Key Performance Indicators (KPI’s) - basically measurements designed to assess performance. You might be familiar with these from other areas of business management and the principle is the same, but we can see their role in web analytics using the traditional mantra:

What KPI’s should I use?
Your choice of KPI’s depends on your business goals as well as who is going to be reading and acting on the data. There are some obvious Key Performance Indicators, but remember that KPI’s are best established as percentages or ratios. Raw numbers mean nothing unless they are put in context. Similarly, KPI’s should be measured over time. Web analytics is not (yet) a perfect science and no WA system can track all your users with 100% accuracy, therefore good analysts must look at trends and changes over time. Some common KPI’s:

• Conversion Rates (Analysed by conversion, visitor type and visitor source (e.g. PPC))
• Cost per Conversion/ROI/ROAS
• Visitor Numbers & ‘Stickiness’
• Visitor Type/Quality
• SEO/SEM Effectiveness
• Internal Search/Exit Rates/Length & Depth of Visits (Measures of how good your site is at providing relevant information)

If you have already set up goals and conversion tracking in Google Analytics then you’ve already got a starting point for your KPI’s. If not, you really need to do this. Every website must have goals, or why have a site?

How do I measure KPI’s?
Get the data into your application of choice (we recommend a good spreadsheet program) then keep plugging the data into your formulas, week after week, month after month. Good analysis is an ongoing process, so set targets and assess whether any changes you make are improving your KPI’s or not. However, don’t get carried away - once you start looking there are hundreds of possible KPI’s. As Eric Peterson says in his highly recommended “Big Book of KPI’s” (see below):

“No KPI Report should have more than a handful of metrics, two handfuls at most“

Google Analytics & Your KPI’s
There is a strong relationship between Key Performance Indicator’s and website goals, so the first thing to do is check that your goals are configured correctly, whether they are conversion goals or ecommerce transactions. Once this is done you can look at some of the dashboards GA provides, which show data trends - Conversion Summary, Marketing Summary & Content Summary:

Then you need to get your data out of GA and into a spreadsheet. Use GA’s export options for this:

KPI’s are a vital element of the whole web analytics process. If you need help establishing, measuring and interpreting yours, GA Experts provides professional services for Google Analytics and our consultants can help you establish which KPI’s are crucial for your business.

Other resources:
Eric Peterson’s “Big Book of Key Performance Indicators”
Yahoo! web analytics forum (KPI’s are a common topic of conversation for web analytics aficionados).