Now it is time to start analysing the data. You’ve setup a data analysis process earlier, likely Google Analytics. It is very important that you ensure that Google Analytics is setup correctly. We are performing Data Driven Marketing here and we need to remember the old maxim again.
Garbage in … Garbage out
Setting up analytics correctly requires more than just loading the tracking code onto your website. To gain the maximum benefit from data, we need to setup things like:
- filters (filtering out your own traffic, filtering out the current influx of spam that is hitting analytics … yes, they’ve even found a way to spam your analytics account directly)
- advanced segments (the power of data is in the segments)
- conversions funnels
- tracking all sources of data eg adding a tracking code onto links coming from emails
We will want to be asking questions of our data like:
- is this traffic source converting?
- which parts of this traffic source are converting?
- what devices are our traffic source using? (desktop, mobile, tablet)
Some Key Points
Pareto’s Law (or the principle of 80/20) will tell us that 80% of the value we can glean from our data will come from 20% of the data. This is vitally important when doing data analysis because there is just so much data available from internet systems that it can be very easy to fall into the trap of analysis paralysis.
Power of Segments vs Averages tells us that averages lie. Statistics can be made to tell us anything we want to hear, so we need to be careful. Averages can hide many things from our attention.
For example, if I have one product that makes a profit of $1000 and another product that makes a loss of $1000 … and both make 5 sales each …. then on average my account has made $0 profit. Now, this is true at an account level, we have made no profit, we made money on one product and lost it all on the second product. But by drilling down lower, we can identify there is a profit maker and a loss maker … now I’m starting to get some more valuable information. I could immediately cut the loss maker out from my portfolio and now with no further work my account is profitable (from gambling parlance we talk of riding the winner and cutting the losers). How can we get more of the profitable product sales? Is it possible to turn the losing product around and make it profitable…or does it really need to be cut?
As another example of drilling down … what if I looked at my traffic sources and found that 80% of my traffic is coming from mobile devices and my website is NOT mobile friendly…how many sales am I losing out on because of my website? Or I look at my traffic and think wow, I’m getting 1,000 visitors a month..but when I drill down on geography, I sell a product in Australia and 80% of those visitors are coming from Russia, 10% of those visitors are coming from China, 5% of those visitors are me and my staff, so only 50 people a day are coming from Australia and are actual real potential clients that I need to be analysing.