Manas Kumar, Thinking out Loud

my thoughts & visions for technology

LiveClicks: Exposing the short comings of Google Analytics

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If I was to tell you that the most advanced, feature rich, and reputed website analytics program in the world has a serious flaw in it; would you believe me?

Well, its a big challenge to point the finger at someone as big and mighty as Google but to tell you the truth, I believe Google already knows about this flaw and has chosen to ignore it to avoid any disruption in profits from their cash cow – Google AdWords.

So here goes –

We all know that website analytics programs such as Google Analytics track the number of page views, visitors, page loads, unique visitors, entry points, exit points etc.

We also know that these numbers have become a generally accepted standard in terms of reporting the performance of a website. Just the other day I had someone in our board room telling me that their website gets “3 million Hits per month” – Sure.

Now I am going to present a real case study in front of you and you tell me if what Google Analytics and all the other fancy, expensive, and feature rich website statistics programs tell you whether or not your website is making you money or losing you money – Now, I am assuming you have a website because you want it to contribute to your revenue stream (somehow) and that you are interested in the bottom line – your ROI.

Website A on analytics shows the following picture:

From the outset, this looks like a website with reasonable amount of traffic. For the non-technical person, this is a good traffic report showing that the website in question is receiving over 40,000 visits per month.

Now we started running LiveClicks on the same website to see if we can find something different. LiveClicks as you know is a heat map based website analytics program that has just one aim – simplification of website analytics.

Now based on the above analytics report from Google the average visitor count for 1 day is 1,396 visitors.

According to Live clicks its no more than 432 per day. Now this was shocking for us. Immediately we thought, “how could it be that our product was so inaccurate compared to Google” – Until we started digging deeper.

Now did you know, that the 41,888 figure in the report above includes all of the following visitor types?

  • Search Engine Bots scanning your page
  • Other search engine spyders (doing the same)
  • Internet nasties scanning your page for email addresses etc.
  • People who come to your website by accident
  • People who come to your website and leave without clicking on anything

Now LiveClicks only monitors traffic and click statistics for website visitors – people who come to your website, click on something, go somewhere else within your website etc.

To us, this interaction is the only true measure of someone being a “website visitor”. So none of these rubbish visitor entries are captured by LiveClicks because in the true sense of the word, you cant call Search Engine Robots website visitors – afterall, is Googlebot going to buy something off you?

LiveClicks wants to show you your return on investment from your website and any associated marketing activities supported by it. Now we do that by tracking the number of leads generated off your website and how they convert to a sale.

While Google also shows you something similar (Goal Conversion) but it ties in with their Adwords program and also relies on your estimation of how much value you put on a lead.

That model is flawed.

If I ask you how much you are prepared to pay me for a lead, you may pluck a figure out of thin air and tell me that. But does it mean anything? What did you base it upon. Does this “guess” define your ROI?

But LiveClicks is asking you how much you have spent on your website (A quantifiable, definitive figure) and its associated marketing activities – you then specify the landing page where you capture leads from (much like Google’s goal conversion), we then tell you the

  • Cost per visitor
  • Cost per lead
  • Cost per sale

All of this put together gives you the ROI you need.

Google aint got it! More so, while being the most sophisticated analytics engine ever built, its capturing everything, but based on a fundamentally flawed concept – the definition of a website visitor.

Now I am aware that something like LiveClicks is going to make some of the marketing managers around look like a bunch of “you know what”. After spending 25 days out of 30 to figure out the ROI of their online marketing spend – they still dont have the right figure. Why?

Because they depend on a fundamentally flawed statistics engine to give them fundamentally flawed reports, leading to a fundamentally flawed ROI calculation.

Can you see how little some people know about the internet? And then there are some who know everything about the internet but arent obligated to tell you the truth – why, because it makes you look good.

Have a think about what I have said above – I have to go now for an urgent Skype conversation but will make another blog post from Brisbane next week.

Comments welcome.

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Written by manaskumar

October 17, 2008 at 4:26 pm

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