A two-pronged approach to Web analytics

Web analytics is an essential part of IT strategy. Knowing who came to your site and what they did while they were there allows you to forecast traffic, making it easier to plan for growth.

The information also helps generate better combinations of online and off-line sales offers, as well as better Web site design. And analytics make it possible to do appropriate marketing by getting real information about which banner ads, online links and partnerships work.

Unfortunately, vendors competitively position products and services and fail to recognize that the savvy IT perspective is to combine both analytics choices: ASPs with page-tagging technology and enterprise software linked into CRM applications and databases.

Most enterprise software crunches huge Web site log files at the end of the day and parses the data into reports based on customer requirements. ASPs, meanwhile, receive page data on the fly while users access the site.

Some ASPs contend that they offer a more realistic view of activity, since log files don't take into account online purchases or pages served up by proxy servers. In addition, if you have multiple servers spread around the globe, information on those servers must be collected, stitched together and analyzed, a daunting task that takes time and computing resources. Also, log files aren't able to detect network disconnects when a user clicks the Stop button, because they just record the visit, not what happens during the visit. The ASP method is also speedier because it records one view of the page, whereas enterprise software might read multiple lines of data using log files.

But enterprise software also has potential advantages. The reports can be more easily connected to existing CRM and business intelligence applications to get a more complete picture of customer behavior. And because enterprise analytics packages sit behind the firewall, security and reliability may be greater.

For companies with a large database of existing customers, enterprise software would be more suitable to track their online activity.

Storage of data is also a consideration. Do you want to pay an ASP to store data, or would you rather do it yourself? You must do a calculation of storage costs because as Guy Creese, research director at Aberdeen Group Inc. says, daily log files of 10GB are no longer rare, and log files are doubling in size every six months.

The decision to use an ASP vs. an enterprise package should be based on specific needs. Relevant and timely Web analytics are valuable and shouldn't be held hostage to an either/or policy. Smart companies will use both.

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