What is Digital Analytics? Guide for Businesses

Introduction to Analytics Tools

Online marketing tactics are constantly evolving as consumers change their preferences with every technological advancement. Many e-commerce businesses are testing e-mail, content, and social media marketing strategy to determine which platform yields the best results with their specific model and target audience. In order to do this, organizations must have an established system that tracks the performance of a promotion.

Thanks to modern business intelligence, many companies are utilizing digital analytics to gather and develop big data from virtual customer interactions. With digital analytics, management can form actionable insights from processed information rather than manually working out raw digital data. This gives organizations the ability to improve their customer reach, service, and experience.

What Are Digital Analytics?

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Digital analytics refers to the measurement and analysis of qualitative and quantitative data gathered online, specifically digital marketing channels. However, the majority of digital analytics revolves around quantifying various performances into metrics. This information provides insight into user behavior and engagement patterns. Analytics can be collected from user interactions, website visits, and online communications.

With digital analytics, businesses are able to define their strengths and weaknesses regarding customer reach and marketing. In broader terms, digital analytics provides performance metrics and valuable customer data that e-commerce companies can use to develop buyer personas.

For example, many online businesses use Google Analytics to track and measure an advertisement's performance so companies can determine which marketing method is more impactful.

This information allows businesses to enhance their customer experience and continuously improve various services. And in return, shoppers are more likely to make repeat purchasing, driving sales and retention rates.

What Are Web Analytics?

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Digital analytics as a whole is an extensive term that covers multiple elements of a more specific type of analysis called web analytics. Web analytics explicitly measures audience data, such as interaction and buying behavior.

In other words, web analytics doesn't evaluate a business's performance directly but instead monitors how online users react to the website. This could include tracking how shoppers found the website, the most viewed page, and even how long they stay on the site. By collecting this information, it is easy to identify common pain points and areas of interest.

With web analytics data, organizations can focus on different services individually, such as optimizing the mobile user experience and changing the website's layout, so it's easier to navigate.

Digital and web analytics offer essential insights into what customers prefer, allowing e-commerce businesses to improve services and meet evolving demand.

How Business Intelligence Improves Data Analytics

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Business intelligence (BI) is an even broader term that encapsulates the entirety of modern data science. BI is the service that orchestrates the transformation of raw data into actionable insights. Without BI, companies are left with large volumes of unstructured data that don't point to a conclusive answer.

For example, an organization can collect the visit length of all of its users in a day. However, without BI, they remain unaware of which pages attract the most shoppers and which have the least engagement. This means that they are unable to make data-based decisions to improve their performance.

With BI, companies can act immediately on the data they collect to improve their business strategies rather than sending the data to a developer and waiting for the report.

BI usually consists of sophisticated software composed of the company's existing platforms so it can pull data from every channel and system, such as inventory and customer relationship management. These solutions can generate details reports on historical and real-time data to paint a holistic picture of the organization's performance.

Before software, companies that wanted insights had to manually record data sets into a spreadsheet or send information to an analyzer, which required an extensive amount of time, resources, and brainpower. Now, businesses can use BI software to translate data as it is collected, eliminating downtime and guesswork.

Digital Analytics Metrics

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Digital analytics metrics quantify different marketing efforts so companies can efficiently check which operations are on track to meeting specific goals. It can even help businesses with search engine optimization. There are numerous types of metrics that organizations can monitor based on their marketing approaches.

Digital Metrics for Websites

Digital metrics for websites cover the various statistics related to online activity and website interaction.

  • Visitor
The visitor, or user, metric tracks each person that visits a website by placing a cookie in their browser. This cookie uses the tracking code already implemented into the site to retain the users' data.

  • Page View
Page view refers to when a user loads a website to their browser. Once the site is opened, the tracking code marks the page view.

  • Session
A session is the group of activities the visitor initiates while on a website that expires after 30 minutes of inactivity.

  • Traffic
Traffic, also referred to as visits, is the total number of visits a website receives within a specific timeframe.

  • Traffic by Channel
Traffic by channel refers to the number of visits each channel gets, such as social media, e-mail, and each page on the website.

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  • Traffic by Device
Traffic by device determines where each website visit is from, such as a smartphone, tablet, or desktop.

  • Ratio of New to Returning Traffic
The ratio of new to returning traffic is measured as a comparative percentage of new visitors to the total number of returning users.

  • Time on Page
As the name states, the time on page metric is the average amount of time each user spends on a website.

  • Interactions per Visit
The interactions per visit are the specific activities that users engage in when they visit a page.

  • Bounce Rate
The bounce rate is the percentage of users that visit a page without engaging in anything or looking at other pages. This rate is compared to the overall number of visitors that visit the website.

Digital Metrics for Lead Magnets

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Digital metrics for lead magnets are statistics associated with content marketing performance.

  • Call-to-Action Click-Through Rate
The call-to-action (CTA) click-through rate is the comparative percentage of total clicks on a CTS versus the total number of website visits.

  • Submissions
The submissions metric is the percentage of people who submitted a web form.

  • Conversion Rate
The conversion rate is the number of actions taken on the lead magnet versus the total number of visits. Typical actions include trial signups, page downloads, and surveys.

  • Free Trial Conversion Rate
The free trial conversion rate is the percentage of users who signed up for a free trial and later converted to customers.

  • Pop-Up Conversions
Pop-up conversions refer to the percentage of many completed pop-up forms that led to returning customers.

  • Ratio of Generated to Marketing-Qualified Leads
The ratio of generated leads to marketing-qualified leads (MQL) is the number of leads gathered from the lead magnet versus the total number of generated leads.

  • Leads to Close Ratio
The leads to close ratio is the percentage of leads converted to customers versus the total number of leads.

Digital Metrics for Email Marketing

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Digital metrics for e-mail marketing reflect the performance of e-mail content marketing.

  • Open Rate
The open rate is the percentage of e-mails that users open compared to the total number of e-mails a business sends.

  • Opens by Device
The opens by device metric counts the number of e-mails opened on each type of user device, such as smartphones and laptops.

  • Click-Through Rate
The click-through rate is the percentage of clicks an e-mail link receives compared to the open rate.

  • Bounce Rate
The bounce rate is the percentage of undelivered e-mails compared to the total number of e-mails sent.

  • Unsubscribe Rate
The unsubscribe rate is the percentage of users that unsubscribed from a business's e-mail list within a specific timeframe.

Digital Metrics for Content and Social Media

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These digital metrics quantify the performance of a company's content and social media.

  • Engagement Rate
The engagement rate is the number of engagement content receives compared to the page's or post's views. Engagements include comments, shares, likes, and clicks.

  • Follows and Subscribes
Follows and subscribes refers to the total number of people that either follow or subscribe to the organization's content to receive updates whenever new posts are published.

  • Shares
Shares refer to the number of times a type of content, such as a page or post, is shared via social media, website, or e-mail.

Digital Metrics for Product and E-Commerce

E-commerce businesses also use digital metrics to evaluate the performance of their online presence and products.

  • Shopping Cart Abandonment Rate
The primary metric that online stores monitor is the shopping cart abandonment rate. This metric counts the total number of online customers that fill and leave their cart without finalizing their purchase and compares it to the total number of online shoppers that complete their transaction.

Benefits of Digital Analytics

Digital analytics gives businesses the power to objectively discern the performance of their various marketing tactics to define strengths and weaknesses. This makes it easier to improve online services so customers are satisfied and return to the organization.

Monitoring digital analytics also provides several other benefits that enable companies to continuously enhance their customer reach.

Measure Online Traffic

By measuring online traffic, businesses can determine the following.

  • The average number of users that visit their website.
  • Where visitors come from.
  • What attracts visitors to the site.
  • What users click on while on a page.
  • The amount of time they spend on the website each visit.

This data allows management to see where the most conversions are coming from and how much it contributes to their customer acquisition and bottom line. For example, if a page shows that the majority of users were converted from a social media campaign, the organization may want to readjust resource allocation to promote these types of advertisements.

Online traffic measures also discern how many of the visitors were organic and how many were paid, enabling businesses to optimize their investments.

Find the Best Target Audience

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It is impossible for a business to create a marketing campaign that will attract every demographic. Typically, there are numerous types of customers and each has its own unique set of preferences. Therefore, companies must define their target audience by studying their customer-

  • Pain points
  • Areas of interest
  • Product preferences
  • Reviews
  • Demographic

By identifying each of these factors with analyses, marketing teams can finetune their analytics strategy to attract their target audience.

However, it is essential to remember that every organization has a unique target audience. Therefore, management must thoroughly define shoppers to differentiate them from the general consumer.

Monitor Business Goals

Every business has short- and long-term goals regarding customer retention, sales, and profits. However, it is challenging to determine the progression made toward these objectives without monitoring performance metrics.

With digital analytics, companies can track their goals and determine which systems drive and lag their progression. By carefully choosing what metrics to monitor, managers can also measure the impact and possibility of worst-case scenarios that could affect reaching various goals.

Create Unique Ideas

Analytics helps develop an overview of a company's performance, giving them the chance to look at operations through various perspectives. This can often spark new ideas on how to improve the customer experience.

For example, businesses may discover customer trends that show users prefer personalized content. This allows marketers to generate customized e-mails based on customer profiles to boost conversion and retention rates.