2005
The Supreme Court removes barriers to interstate (i.e., online) wine sales; businesses scramble to meet new data-security standards imposed by a consortium of credit-card companies.
Counting More Than Clicks
If you build it and they come, how will you know? For as long as companies have been involved in E-commerce, they have been attempting to measure Website traffic and the ultimate business value of an online presence. A class of software known as Web analytics now constitutes a $258 million market, according to IDC, and will increase to nearly $400 million by 2008.
Not only is the market growing, it's also changing. The initial users of Web-analytics tools were Web masters and IT staffers, says Gartner analyst Bill Gassman, and they focused on technical information, such as the top 10 pages viewed. Today, leading vendors of Web-analytics software, such as WebTrends, Omniture, WebSideStory, Coremetrics, and others, design their products to meet the needs of ROI-oriented business users who are far more interested in who buys from a site (and why) than who visits it.
"[Customers now want] segmentation data so they know who is buying what, and they are interested in the results of advertising campaigns," explains Gassman. "They also want to find out why people are not doing exactly what the company would like them to do on the Website."
But companies need to be careful, warns Forrester Research analyst Bob Chatham. According to a study he recently authored, the data that organizations get from Web-analytics applications may be a lot less accurate than they expect. One problem is a shift in technology: earlier software relied on log files, which essentially count computers, not people. That is, the files sometimes count as a single visitor all people who access a Website from the same IP address (all employees of a given company, for example). And the software may fail to "see" people who visit a Web page that has, in the interest of efficiency, been cached (stored temporarily on another server) by the ISP.
Newer products use page tags, or small units of code on a Web page, that transmit information about any browser that loads that page. These tags enable companies to track a visitor as he or she moves from one page to another.
Chatham cites one Forrester client who discovered that a shift from older Web-analytics software that used log files to newer versions that use page tags resulted in an apparent 40 percent change in traffic. But even with the use of newer technology, monitoring Websites is tricky. Site developers often forget to tag pages, which hamstrings data collection. Some software arbitrarily defines a Web session as a 30-minute visit and, once that time expires, counts that same visitor again. And in what is perhaps the biggest challenge, many users now disable the "cookie" function of their Web browsers (a small ID file created when they visit a Website) in order to protect their privacy, which makes it impossible to recognize them as return visitors.
"Web teams need to develop a set of best practices around the use of tags," says Gassman. "It's a huge change, but it means the difference between 'comfort information' and truly actionable information." This may be that rare case in which companies must battle information underload. — Alan Earls
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