Q&A: Eric Peterson, Web Analytics Demystified
Eric Peterson, CEO and principal consultant of Web Analytics Demistified, is the author of three books on Web analytics: Web Analytics Demystified, Web Site Measurement Hacks and The Big Book of Key Performance Indicators. I spoke with Peterson by phone about the state of Web analytics in the media industry. Here’s an edited transcript of our discussion.
What are some of the key issues you see media companies grappling with in regards to Web analytics and audience measurement?
One issue is the reconciliation of data sources. Media properties have a historical dependence on the Comscores and Nielsens of the world, whose focus is on demographics. The companies that focus on census data, like Omniture, take a different approach, and get different numbers. Media companies try to compare these numbers, which raises frustrations.
The second theme is the emergence of different ways to look at media properties. Driving engagement, readership, ad impressions (monetization) – taking these different measures of interaction and using them as measures of success, rather than pages per visit.
What are some of the common mistakes you see media companies making?
The most common mistake – not by all media companies but by some – is not resourcing for digital measurement. They try to get by with just the tools, but not the expertise to run those tools. You wouldn’t run finance with one financial analyst.
Everything else falls off of that. The more people you have, the more attention you have, the better the quality of the data and the insights around that data.
Is there still a learning curve for CEOs, publishers and other decision makers about the value of metrics?
Tons of education needs to take place at the CEO/CFO level. A CEO running a media empire gets the data-driven piece as it pertains to finance – he couldn’t run his business without it.
Now, along comes digital, it’s growing by leaps and bounds, but management still doesn’t recognize the need to think differently and strategically about investments in digital management.
Some sites don’t have digital strategies. Some sites don’t have a well thought-out measurement strategy. Buying Omniture is not enough. If you’re committed to digital, how can you afford to not be committed to measuring it?
Why is there such a lack of consensus on Web metrics?
The vendors could do a better job. It’s easy to be cynical, but the reality is the vendors don’t have the resources to answer those kinds of questions. Their goal is to have the easiest-to-use application and to get people to use it.
But Web analytics is hard. You can’t do an hour of analytics a day and become a ninja.
There’s fear against a system that companies don’t have trust in. One media company I worked with could not agree on the three measures of success that they would be judged against.
How does a media company figure out which solution is best for their needs?
Develop a strategy for how you’re going to use analytics as an organization. Don’t try to stumble into it and develop consensus as you move along – challenge yourselves to develop a strategy for defining metrics that you can actually use for your business benefit. Once you do that, it starts to seem easier.
How do you justify investments in Web analytics?
If you’ve seen your offline revenues decrease substantially while your online business is increasing, you have to ask yourself, Does not having a full and complete understanding of online customers create a potentially disastrous situation for us as a business?
That makes it concrete. If you’ve historically invested millions in list segmentation and production of a print product, and now your online channel is emerging, are you spending a reasonable fraction of those costs on the digital channel? It’s not hard to justify when you look at it as a long-term opportunity.
But if you’re not going to use the data to improve the website, then save yourself the money. There are plenty of free [analytics] applications – use those to do the best you can.
What other advice would you offer to media companies?
Don’t give up. A lot of companies started with tactics, not strategy. Maybe they made major investments in analytics six or seven years ago, got frustrated, switched vendors. Now they’re still frustrated. But if you’re not getting as much as you expected out of Web analytics, it’s probably not the technology – it’s probably you.