How To Measure and Improve Site Success (Part I)

By Bobette Kyle
Posted Tuesday, February 10, 2004

Measuring and understanding your Web site's success is a critical process that is sometimes overlooked. Many times, marketing efforts stop at getting traffic to the site.
Traffic alone, however, does not make a site successful. By "connecting the dots" between your marketing programs and end results, you can improve performance. Ultimately, site success depends on how well your site performs with respect to your goals. Measuring actual results against those goals tells you how well your site is succeeding.

In my view, improving results lies not with measuring the results themselves but in measuring, understanding, and adjusting the events that lead to those results. Further, having a marketing plan that identifies general strategies and specific programs for meeting your site goals will give you a higher baseline performance to work with when improving upon your site's success.

Have a Plan

Whatever your Web site goals, a marketing plan helps you better meet them. By including two or three general strategies to meet each goal as well as *specific* programs under each strategy, you are better able to evaluate and improve upon performance.

For example, let's say you make high quality, custom-made scarves and wish to sell them regionally:

* A Web site goal could be to begin selling scarves online and achieve "x" amount of sales in the first six months online.

* One general strategy for meeting that goal could be to get the site known locally by fashion conscious ladies in your community.

* A specific program to support this strategy could be to hold a contest on your site, with the prize being a free, customized scarf. To promote the contest, you could issue a press release, which you send to fashion editors, etc.

By taking this funneled approach - planning down from the broad goal to the specific program - you are better able to evaluate how well each program supports (or fails to support) your goals.

From the start - when you are developing your plan and deciding upon site structure - think about how to measure performance. Measures will differ, depending upon the situation, but should be both quantitative and meaningful with respect to helping you improve site performance. Choose a set of measurements that tell you not only how your marketing programs are working but also how well they support Web site goals.

Evaluate Marketing Programs

In order to evaluate a marketing program's success, first decide your objectives. Then, most importantly, "connect the dots" between those objectives and your site goals. Later, when analyzing program results, evaluate not only whether the program succeeded in meeting objectives, but also how well it moved your business toward its Web site goals.

It is possible to meet a project objective while failing with respect to site goals. A frequent example is traffic generation programs. I often read stories of a business participating in "hit" programs with disappointing results. They reach "hit" goals, but see no benefits.

Consider Return on Investment (ROI)

One way to evaluate marketing project results is through a Return on Investment (ROI) analysis. The ROI is a computation that tells you how much you got back compared to what you put into a project. You can express ROI in terms of a dollar amount or as a ratio. Either way, the formula itself is simple.

The dollar amount formula tells how much you increased profit in total dollars as a result of the project:

(Cost savings and earnings as a result of the project) minus (Dollars invested)

The ratio formula tells how much you got back, in dollars, for each dollar you invested in a project:

(Cost savings and earnings as a result of the project) divided by (Dollars Invested)

IMHO, things get sticky when you try to define "cost savings and earnings as a result of a project". This is because returns from marketing investments are broader and often more abstract than returns from some other types of investments. Marketing investments result in not only direct monetary benefits, but indirect benefits as well. To make matters even more difficult, the indirect benefits are often intangible and difficult (if not impossible) to measure.

If you are part of a typical small business with limited resources you may be in a seemingly no win situation. Accurately computing ROI requires a detailed analysis for which the internal resources and expertise are often lacking. Outside consultants can spend hours unearthing data and computing an accurate ROI, but this can be expensive on a small budget.

This does not mean, however, that you cannot make your best effort and use ROI as only one of several inputs into your project evaluation. When figuring ROI and evaluating project success, keep in mind that each project will realize different types of benefits. Aside from direct dollars cost and direct dollars returned, consider other potential project benefits, including how well it supports your site goals. Other aspects to consider:

Improved Customer Relationships
Happier customers can represent a return on investment. This can be gauged through repeat order patterns, by a change in the number of complaints/compliments, or through customer surveys comparing pre and post project satisfaction.

Influence On Off-Line Sales
Online activities often have an influence on off-line transactions. You may experience sales leads originating from your Internet programs. Customers may also be driven to your off-line store as a result of online information.

Brand Building
Online activities can mean better long-term growth for your brand. Market share changes, online interactions, and brand awareness surveys are some ways you can judge brand-building effects.

Company Growth Potential
Factor in long-term growth prospects when evaluating your project. For many businesses, the Internet provides access to new markets and customers. If you have a local business, for example, your Web site could extend your business far beyond the city limits.

3 Step Approach
Take into account these broader implications, pay attention to how well a program supports your site goals, and measure project results. By taking this three-pronged approach, you can better choose marketing programs that will result in a successful site.

In Part 2 of the Web Site Success Series, I look at several Web metrics, ways to measure and improve your site by understanding the data. Read How To Measure and Improve Site Success, Part 2: Evaluate Site Activity With Web Metrics.

About The Author
Bobette Kyle is author of the Marketing Plan Guide "How Much For Just the Spider? Strategic Web Site Marketing for Small Budget Businesses". Read more about the guide here (websitemarketingplan.com)