3 Common Mistakes Marketers Make With Their Analytics

Mo Analytics, Mo Problems — other than a terrible use of the great Notorious B.I.G. song, this phrase accurately reflects how marketers feel about their analytics. If marketers aren’t versed in the finer details of the different metrics, they can easily draw the wrong conclusions with their on-page optimization and reporting.

1. Thinking Greater Time On Page Equates To A More Engaged Customer

Average time on a page is a core metric to assess your page performance in many analytics platforms.

analytics pageview - image 1

However, marketers often incorrectly assume that it’s a good measure for customer engagement because more is always better, right? However, what if the average time on a page is high because the customer can’t find what he or she is looking for?

Marketers need to understand the goal of each individual page. For example, the goal of a sign-up form should be to quickly convert the customer, meaning a lower average time on page is potentially better.

Therefore, a better metric to optimize your page around is bounce rate, which measures the percentage of customers who leave a page if it’s the only page they visit. This metric properly accounts for both intent to view a page and if the page satisfies the viewer’s needs.

2. Thinking Return On Investment (ROI) Is Always The Best Measure Of Marketing Effectiveness

Return on Investment (ROI — calculated as the profitability of a marketing activity divided by its cost) is a popular metric among marketers to calculate marketing performance. However, ROI often does not account for the time it takes to recoup your marketing spend. When time is not accounted for in comparing two projects, it can be misleading.

For example, which is the better investment?

  • Choice A: Spending $50 now to create additional blog content that will generate $100 in profitability in one year — 100% ROI
  • Choice B: Spending $50 now to secure product placement in a movie that will generate $110 in profitability in three years — 120% ROI

In some situations, Choice A is the prudent choice because profits generated could be further reinvested in other projects, potentially generating more profits than Choice B.

To account for time, pair ROI with Payback Period, defined as the time required to recoup your marketing spend. Using our above example:

  • Choice A’s Payback Period is 1 year
  • Choice B’s Payback Period is 3 years

Another suggestion is to use Net Present Value (NPV), which calculates marketing performance similar to ROI, but also accounts for the time value of money. That is, the value of $1 today is more than the value of $1 a year from now. NPV accounts for this by discounting future cash flows by an appropriate rate. The discount rate is typically the percentage return you could receive on other marketing investments, also known as the opportunity cost of capital. NPV is calculated as:

  • (Initial Investment + (Year 1 Profitability) / (1 + Discount Rate)^1) + (Year 2 Profitability) / (1 + Discount Rate)^2) + (Year 3 Profitability) / (1 + Discount Rate)^3) + …)

Applying a 10% discount rate to our previous example nets:

  • Choice A: NPV of $41
  • Choice B: NPV of $40

Be careful with your discount rate assumption as it can drastically change the outcome. As a simple rule of thumb, if you’re measuring short-term marketing performance, ROI is better given its simplicity. However, if your marketing activities stretch out over a few years, payback period and NPV are better.

3. Incorrectly Thinking That Word Of Mouth Traffic Or Other Traffic Equals Organic Traffic

Upon reviewing which keywords visitors used to find you organically on search engines, you’ll likely notice many of them are associated with your brand. For example, HubSpot’s detailed Organic Traffic analytics looks like this:

organic traffic - image 2

While visitors did find you via an organic search, that’s not necessarily how they first heard about you. These visitors could represent word of mouth traffic — individuals referred from a current customer or follower of your company.

The second potential issue is that your analytics platform displays last-touch attribution, the last medium the visitor used before he or she converted to a lead. Leads typically visit your site multiple times and through different sources before converting. This means that last-touch attribution masks the original and potentially most important source that generated the lead. Analytics platforms such as HubSpot and KissMetrics provide first-touch and last-touch attribution.

Finally, the keyword could represent a visitor who originally found you through social media or a paid advertisement campaign but that insight was lost because the tracking cookie expired or a different computer was used.

This nuance could mean that you’re overstating your return from SEO activities and correspondingly not understating your return from other online marketing activities.

As marketers, it can be easy to think that more analytics are always better. To draw valuable insights from your marketing analytics, pay close attention to what each metric is really telling you and dig deeper into why that metric is important and what might have caused it.

As you make your marketing decisions, think about what your goals are – whether it’s tied to how you want prospects to engage with you, your overall marketing ROI, or traffic to your site. Understanding which metrics can best help you appropriately identify issues and future strategies will prevent you from getting bogged down with marketing data.

Opinions expressed in the article are those of the guest author and not necessarily Marketing Land.

Related Topics: Analytics | Analytics & Marketing Column | Channel: Analytics

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About The Author: is a product marketing manager at HubSpot, whose all-in-one marketing software helps businesses attract qualified prospects and convert them into leads and customers. Juliette manages marketing for HubSpot's mobile and marketing analytics products. She holds an MBA from the MIT Sloan School of Management and a BS from the Boston University School of Management.



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  • http://wordswordsseowords.com/ Christopher Skyi

    I think of brand keywords as more navigational, e.g., I sometimes go to the ‘duane reade’ website, but I can never remember the url, mostly because I can’t spell it, so I let the search engine find it for me. Other times I know where I want to go, I’m just lazy about the url so I again let the search engine find it for me. You’re exactly right that this isn’t the direct results of SEO work. If a site gets a lot of referral traffic, then the brand name of a site may be on those other sites and that’s how people start using it in the search engine because they don’t know the exact url or they don’t have the referral link and they never bookmarked the site . . .

  • http://www.zenius.net/ Wisnu OPS

    I would add “page per visit” as the 4th:
    Some marketer think that high page per visit is always good. Well it might be good, but sometimes, it just represents bad navigation and bad information structure of the website, so that visitors need to go to several pages to find what they are looking for.

  • http://designpin.co/ The DesignPin Blog

    Interesting article and thanks for tips you included in it. I would also agree with Wisnu OPS that ‘page per visit’ is sometimes an indicator of problems with navigation that force users to wander across the site in search of the info they were looking for. I did not look at average time spent on a site as a mistake so it is precious info.

  • Anthony Smith-Chaigneau

    In your ROI section how on earth can you calculate that a $50 blog content spend will bring you $100 dollars in 1 year – Who on earth thought that one up? There is no quantifiable metric that can prove that blog content brings you anything ever and certainly who will remember what happened a year back that brought in revenue…We are playing with accounting parameters that make no sense whatsoever in marketing – In fact the whole ROI part of most marketing is pure fiction. ROI and NPV for tangible goods that have a COGS attribution I agree but for marketing it is delirious to even suggest it!

  • Jonathan Elder

    Bounce rate also has issues – a high bounce rate may be desirable where the page itself is the goal. For instance, a customer support self service help page with instructions to fix a problem should show a high bounce rate (and possibly a long time on page) if it solves the exact issue. contact pages often have high bounce rates as the visitor found what they were looking for, such as an address of phone number.

    There are ways to monitor some of these, such a phone conversions, but I always try to help customers understand the visitors motivation for reading the page will have a big effect on both time on page and bounce rate, and neither is inherently bad or good.

  • Juliette Kopecky

    Wisnu – I completely agree. One of the things we do here at HubSpot is frequently user test our software and our website. We’ll ask testers to complete tasks that we want visitors and customers to take (e.g. find pricing information, learn about our product, write a blog article) and observe how they do it. This helps us measure how intuitive our site and product are.

  • Juliette Kopecky

    Anthony – I would disagree that it’s not possible to measure revenue associated with a blog article. In fact, that’s exactly what the HubSpot software helps our customers do through closed-loop analytics (http://www.hubspot.com/products/closed-loop-marketing/). For blog content in particular, we’re able to track how many visitors, leads, and customers each piece of content brings in and/or assists in converting. From there, we can calculate the revenue associated with each customer and compare it to the cost associated with that piece of content.

  • Juliette Kopecky

    Jonathan – Absolutely! While these metrics are valuable, it’s always important to dig deeper into the intent associated with them and how it relates to your overall goals. As you mention in your example, your goal of the contact page might be to actually have people leave from the page. One way to test if that page is effective might be to measure how many people are calling in to the phone number listed vs. how many visitors are coming to that page. Thanks for your comment.

  • Anthony Smith-Chaigneau

    Perhaps you can in certain instances and academically…however you have failed to take into account the cost of the software, the time spent on such an exercise and the staffing cost to track over 1 year … If the analysis is so perfect as you want us all to believe we only need the CFO and an Ad-Tech geek in the marketing dept in the future and outsource all creative to save budget! The results are also so not that ‘pure’ … so for that reason I am very sceptical about treating marketing collateral as a ‘product’.

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    If some one wishes expert view regarding running a blog then i suggest him/her to pay a quick visit this website, runescape accounts sale Keep up the pleasant job.

  • Juliette Kopecky

    Hi Isaiah – I completely agree. Sometimes it can be easy to fall into the “this is the way we’ve always been doing it” trap when it comes to marketing and even the analytics you use to measure. Thanks so much for reading and your comment!

 

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