I’m starting to prepare for the tutorial I’m giving at the JBoye Conference in Philadelphia on May 3. The class is called Beyond Visits and Page Views…How to Develop Actionable Web Metrics, Reports and Analysis. One of the areas that I’ll be going into in some depth is how you can build metrics that drive decision making. This would seem to be a clear goal for any Web site measurement initiative, but it is a huge struggle for many organizations.
There are multiple reasons, but I think there is one in particular that causes considerable distraction from meeting this goal:
The popularized understanding of Web Analytics KPIs has led us down the wrong path.
Key Performance Indicators (KPIs) are a term that you hear a lot in Web Analytics practice. KPIs are commonly considered to be the metrics that you use for measuring your Web site with Web Analytics. For many, visits, visitors, page views and referrals trended month over month and year over year are the Web Analytics KPIs. This is not what KPIs are about -- in fact KPIs are only a part of an equation that creates a complete and useful measurement.
Let’s get some historical perspective. In the 1960s, D. Ronald Daniel of McKinsey and Company came up with a methodology to help organizations define and measure their effectiveness against business objectives. In the 1980s, this methodology was clarified and evangelized by Jack F. Rockart of the Sloan School of Management. The result was a hierarchical system of evaluation that was based on:
- Definition of organizational mission
- Identification of strategic goals that map to the mission
- Determination of concrete and measurable objectives
- Definition of Critical Success Factors (CSFs) that are used to evaluate the objectives
- Developing a KPI measurement and target that determine whether the CSF is being met
In Web Analytics, the model could look something like this:
- Organizational mission -- Be the industry leader
- Strategic goal -- Provide the most reliable and authoritative information
- Objective -- Publish a weekly email newsletter
- Critical Success Factor (CSF) -- Increase number of subscribers to the weekly newsletter
- KPI -- number of newsletter subscribers per month
- Target -- increase the number of newsletter subscribers by 10% each month
The idea here is that you can have a number of CSFs per objective, and a few KPIs and Targets associated with each CSF.
KPIs: One Part of the Picture
As you can see, KPIs are only one part of a bigger picture and you can do a lot more to make your current Web Analytics numbers relevant, compelling and useful. It doesn’t necessarily have to take a lot of work or sophisticated tools…it just takes a different and more contextual way to look at the numbers.
So, I hope you’ll join me in Philadelphia for the tutorial. I’ll show you how you can use the real KPI methodology to improve your metrics and talk about other techniques that will really help you get value from Web Analytics. I also suggest you consider the rest of the JBoye Conference. As always there is a great program and I’m pleased to see a big emphasis on Web Analytics this year, as well as online strategy, user experience, content management and lots more.
One last note: There's still time to apply for the X Change Web Analytics Challenge to Benefit Non-Profits. Deadline is April 30.