Excellent Analytics Tip#2: Segment Absolutely Everything

Second in a series that aims to share some guidance on how to move from the world of Web Analytics to the world of Web Insights.

By now it is fairly well established that absolute numbers (KPI’s) that represent one data point are fairly useless. Example: what was the conversion number in May. Just by itself it is not useful.

A while back we all moved to measuring trends which gave a bit more context to our metrics. Example: what is the trend for my conversion rate from January to May (or even better from May last year to May this year). Gives nice context on if we are up or down over a time period and over same time last year.

New Nirvana Rule: Never report a metric (even God’s favorite KPI) without segmenting it to give deep insights into what that metric is really hiding behind it.

The power of segmenting a metric is that you peek behind the curtain and find out more about the metric. These are the benefits that you will gain:

1. It is impossible to segment any metric without putting in the effort to understand what we are reporting and the business value that the metric represents. This is hard work but what does not kill you makes you stronger. :~)
2. Segmenting allows you to quickly hone in on areas of deeper dive from which will emerge key insights that will drive real and meaningful action.
3. Our senior executives and decision makers don’t understand all the complexity and magic that is a web experience, showing them segmented trends is a extremely effective communication tool (and the best part is you barely have to talk, the picture will tell the story).
4. You will earn a big fat bonus and promotion.

Leaving you now would be lame, here is my attempt at providing examples that illustrate this recommendation.

We have established that this is not very useful:

I have recently come to believe that if a visitor does not stay on the site for atleast five seconds then that is an unqualified visitor (or that we never had a chance with them). Because even the most compelling websites need atleast five seconds to sell you on anything (not just products but even ideas). So application of a simple segmentation to me on this website is how many people are in the game.

This simple segmentation tells me that just 48% of all the traffic stayed for more than five seconds, I never had a chance with the others. Let’s say your traffic this month was up, instead of getting credit you’ll be prompted to dig deeper into what happened, what were the reasons for 52% of the traffic leaving so quickly. Were we running wrong campaigns, are our meta tags wrong? It might prompt questions about what the number was for prior months.

There is a nice flip side though, if only 48% of the traffic stayed for more than 5 seconds look at what it can do to your conversion rate (it goes up, bonus for you baby!).

Another way I could segment this traffic is by the hottest thing on earth: Search. I got great traffic but how many did I get from Search, and I wonder how may from Google.

Again you have a nice little context for your total traffic that you would not get by just showing total traffic by itself. You can now say we are only getting 18% of our traffic from search engines (is that good or bad? you decide) and 85% from google. There is a recommendation sitting in there about our search strategy and perhaps diversifying to other search engines (per the latest numbers google has 47.8% of overall search traffic). Alternatively your CEO could say: My influence circle is wrong, if search is not “hot” for us then where are people coming from?

But you can go further and stitch the story together with the first example…..

This might be a home run, one picture shows a great story all together. We are getting a good amount of traffic from google but of that only 34% is staying for more than 5 seconds. Since such a unusually high amount of traffic is from google might be SEM/PPC in which case we are much worse off because we spending money and people are not staying on our site.

Here is a example of how you can analyze segmented data over time and make the story even more powerful….

It is not pretty but I am sure even without any context you can look at these numbers and draw out so many nice insights that could lead to actions.

The “Overall “Benchmark” fm Trend” is simple average of this year’s performance and that gives you a cool way to see how the latest month is doing. Of course you can make it even better if you have pre-set goals.

Hopefully you see the power of segmentation demonstrated even by such a simple example. For your website and business maybe it is not time on site that is important, maybe it is page views, maybe it is conversion rate, maybe it is number of leads, maybe it is DM Campaigns, maybe you only rely on PPC/SEM.

Understand what your business is, what are areas of strategic focus and then segment away.

Please take a vow that today is the last time you have sent a excel dump of Top Pages on Site report to the entire company, change that to Top Pages Viewed by All Visitors by Search Traffic and by Top Affiliate Partners (or whatever).

There is no KPI so insightful all by itself, even in a trend or against a forecast, that it can’t be made more impactful by applying segmentation.

Agree? Disagree? Have examples? Please share your feedback via comments.