Which webstats are really important?
At first glance, most people think “that’s simple! It’s how many visitors i get”. Well is it? Let me pen out a few questions for you, and I’ll ask you again…
* What is your Average Income per visitor
* What is your Average Cost Per Visitor
* Do you know your Visitor Sources, and their Value
* Do you know the cost breakup (Income Vs Cost) of the source country of your visitors?
Now, I’ll ask you again, “Which Web stats are really important”?
I have been asking that question over and over for the last couple of days, trying to come up with as many answers as possible. I’ll be truthful why I have been asking these questions (and no, this isn’t a sales pitch, I promise!). I am currently writing my own web analytics software (closed beta!), and well I am trying to work out what statics people really NEED as opposed to want. I am a firm Believer in giving a person what they need, even though it’s most an uphill battle. Now that I’ve come clean on the source of these questions, I’ll continue on.
The main problem with the question is that it’s different for everybody, if you are a marketer, you want to know how much Cash you are paying to get a visitor to your site, and attempt to optimise it. But as a sales man, you want to know how much Income you are generating on average per visitor. Looking at these two angles separately you’ll automatically think more visitors more money, well that is true, the reverse is also true – the more money the more visitors, it’s the balancing act that people try and do. But if you Combine the both of them, and start looking at the micro stats, More questions start popping up that maybe people never consider – but are maybe more important than the usual ones. Which Visitor Group is generating us the best ROI (Return on Investment)? An example to make sure we are on the same level. Ok you are paying .50c a visitor from adwords, and you are converting 10% of your visitors into sales. So you are paying $5 a sale (for visitor generation). Now if your average sale is $10, then you are making $5 gross profit on the sale, depending on your product/item that might be a lose or a profit, but for this example we’ll ignore that. So your ROI for the above example would be 200% (ie $10 return on $5 spent).
Now, If you could look at your visitor costs & sales per country, you might be able to shift that in which ever direction you wanted. Just say that your Average cost of a visitor from England was $1, your marketer might have a fit and turn off that traffic, But if the Average Sale per visitor was $40, your ROI would be going up (about 400% - $40 sale / $10 visitor – still working off a 10% conversion). Now if your conversion rate for English visitors was 12% or 13% you’d be throwing a party, now the important bit – what if your visitors from sale Mexico, only cost 10c a visitor, but the average sale was only $2, and there was a 1% sales rate (ok a lot of math – 10c a visitor * 1% conversion = 10$ sale, cost - $2 a sale, that’s a loss of $8 a sale.)
We focused on SEM above (paying for traffic) but this also converts into SEO as well, you need to pay for your SEOefforts, either with your own time, or paying staff for their time. While you’re not bidding for keywords, you’re working on improving your Organic rankings for the SEO keywords. The sale principles still apply, how much work are you putting into building your keywords, what keywords are getting the most traffic – and the best conversion rates (now that is two questions to be clear – quite often with totally different answers), If you’re getting 1000 visitors for a keyword with a 1% conversion rate, is that better then getting 100 visitors with a 10% conversion rate? Well the answer to that is – you probably spend a lot more time on getting the 1000 visitors / month keyword then the 100 visitors / month keyword. SEO is perhaps more important than SEM in the long run, as it’s almost free money – but you need to target your keywords just as much, if not more to ensure you get your optimum long term benefits. If you do it well, your cost per visitor with SEO can be considered less then SEM.
Now let me ask you again? What web stats are important to you? Please leave me a comment with an answer if you have gained anything from this article, Not just for my research, but also for other marketers and webmasters out there that could benefit from them as well, and as always – feel free to ask questions or leave a comment!
- Justin
