- Category: September - October 2008
Usually you need an interdisciplinary project team to introduce a Web analytics system where business management, marketing, IT and engineering respectively often work with external service providers and consultants. The objective of the project management is to contribute knowledge and requirements from all areas to guarantee profitability. The
approach to conduct a Web analytics project exclusively through marketing or IT usually does not bring in optimal results:
- The IT managers tend to focus more on technical feasibility which leads to more technological indicators and which in turn are usually not really the relevant key figures for business success.
- The marketing team usually implements relevant performance figures in the project, but works in cooperation with external service providers, often around structural island solutions that can’t or only with difficulties, get integrated into the information technology infrastructure.
- Ideally, the executive board manages the project with members from all involved functions in a classic matrix organization. The focus of the project management is primarily on the profitability of the Web analytics introduction measured in return on investment (ROI) on the integrated technical implementation and concentrated on the essential Key Performance Indicators (KPIs), which actually represent the strategic objectives of the company.
Planning of a Web analytics system
Although the planning of a Web analytics system is different for each company, there can be developed a general guideline that points out the most important steps.
The success of Web Analytics projects stand or fall with the design of the online activities. If the Internet concepts already have a relevant reference to the business strategy, they are usually stable and contain the main KPIs.
With the focus on the relevant figures, which are individually tailored to the particular businesses and own strategy, the selection of possible tools and manufacturers respectively is automatically reduced. But if on the other hand due to a lack of preparation only general figures without reference to the specific task of the company’s Web analytics system has been asked for, many tools can meet these requirements. In this way, the entire project starting from the introduction stage is clearly bloated, thereby putting pressure both on time and finances. The setting of a task should be defined so far in advance that only about three possible solutions provider come into consideration as a partner. These candidates will then be examined and evaluated regarding completion of specifications in order to come with an adequate effort.
Duration of the project and project expenses
The duration for the introduction of a Web analytics system depends of course heavily on the requirements. As a rule, approximately three to six months have to be planned in for the handling of complex Websites. Due to the large number of participating members from various functions and the close connection with the business strategy, shorter project durations are rarely reached. It is relatively difficult to make general statements of expenditures for Web analytics projects, as requirements and technical implications according to Website, program producers, and project organization can be diversified.
In general however, for the calculation of expenses, the following rules can be consulted:
- The HTML elements that have to be integrated in the Website - tracking pixels, landmark – are set up very different from manufacturer to manufacturer and require very different back-end integrations with complex dimensions and metrics. Generally, these HTML elements are completely incompatible in nature between manufacturers – an exchange of the provider leads at least to a completely new technical integration of the new provider, which has of course an impact on potential evaluations of tools.
- The project phases - planning/ conception and validation – should be overall calculated with at least thirty percent of the expenditure.
- Even if the technical integration is often mistakenly regarded as trivial, an accurate integration concept should be developed and it should pay heed to the fact that all KPIs and their illustrations in form of specific tracking elements in the pages are documented properly. Otherwise, a subsequent maintenance is not feasible. The expenses for it have to be calculated and scheduled.
An exemplary project plan
- Creating a catalogue of requirements with the following aspects:
- Key Performance Indicators (KPI) for the mapping of relevant results from online activities.
- Web scorecards to summarize the KPI and to compare them with the nominal values.
- Breakdown of internal and external marketing activities.
- Requirements of the reporting function with necessary formats, opportunities of user administration, distribution of reports and automation options.
- Integration of data (import, export), interfaces to other “data worlds” such as data warehouse and inventory management system.
- Information from other information systems such as for instance the return rate from the ERP system.
- Development of the optimization potential and monetary valuation which is necessary for the ROI calculation.
- Developing of a Request for Information (RFI) for the selection of Web analytics tools and their manufacturers respectively. The RFI listed in the criteria should allow an individual assessment and be weighted in accordance with the requirements of the company.
- Choice of an appropriate tool. Ideally, the chosen solution should be profitable within a maximum of 24 months.
- Creation of a technical implementation concept with appropriate project plan.
- Integration into the Website and first validation of the measured data. The plausibility test helps at this stage, with a large amount of figures possibly to identify vulnerabilities.
- Set-up of the user administration, preparation and configuration of the reports.
- Positioning of the Extraction- Transformation-Load (ETL) for the data flows into other information systems.
- Detailed validation of the figures. This phase sees the fine-tuning of the system, where if necessary, corrections in the technical implementation have to be carried out. Further needs that do arise only in the course of the project are realized at this stage.
- Project approval and launch. At this point starts the regular planning process of planning, measuring, analyzing and optimizing which ensures the success of the project.
A commitment to comply with the actual requirements, combined with a defined right of withdrawal, helps to sort out those suppliers that in principle meet in the first round all requirements, but can’t deliver later in the required form.
The selection of only a few individual and important KPIs reduces also the costs for the technical implementation on the Website that represents a major part of the overall project. It is recommended not to define more than 5 KPIs per role. If on the other hand, the used tool due to inaccurate preparatory work has to be changed during the implementation, the needed effort is almost as high as with a new project.
Budget and profitability
Web analytics systems aim for economic success of the company, with the consideration of returns on investment (ROI), profitability and/or economic efficiency, a central aspect.
On the expenditure side, the following has to be taken into consideration:
- Expenses for marketing campaigns
- Expenses for Website optimization
- Costs for analysis and evaluation
- Cost for the Web Analytics Tool
On the other hand, there are cost reductions and result improvements respectively through:
- Saving potential with marketing actions (waste coverage, macro conversion)
- Improvement of the micro conversion
- Increase of the efficiency
- Increase in sales and leads
Based on a given period of twelve to twenty-four months, the introduction of a Web analytics solution should become profitable, according to this the required budget has to be provided - see also paragraphs 1-3 and 9 of the project plan.