Data tells a story – it's our jobs as marketers, entrepreneurs and executives to decode it. Google Analytics is a web analytics service that tracks and reports website traffic, allowing marketers to build data-driven marketing strategies. It’s easy to set up, but not so easy to use.

One of the advantages of outsourcing your marketing is that agencies have developed proven methods of successfully transforming website data into action items across hundreds of clients. But, if you're going to do it yourself, here are some best practices:

1 – Look at Year-over-Year Data

Comparing annual data can reveal seasonal gold mines – that is, times of year where your ecommerce conversion rate (ECR), average order value (AOV) and value per session (VPS; total revenue / total sessions) are high. Spend more when your customers are most active to get the most bang for your marketing buck.

Benchmark seasonal performance against macro trends. For instance, global advertising costs tend to skyrocket during Q4, as holiday advertisers compete for limited inventory. While your brand may be a great holiday seller, consider the rising cost of holiday advertising when planning your increased spend.

2 – Identify Top-Performing Customer Segments

Dive into the Audience report to separate your customers by age, gender, locations, devices and even interests. Compare which of these segments perform best with respect to both total revenue and ROI. Allocate budget away from low-performing segments in favor of those that drive the highest ECR, AOV and VPS. Often, the segments that perform best in these metrics won’t make up most of your traffic or revenue.

Let’s say your products are targeted toward females, 25-45 and this demographic makes up 50% of your traffic with an aggregate 1.5% ECR. But you notice that 5% of your traffic is coming from males, 55+ who convert at 3% overall and 5% around the holidays. Perhaps dads are buying your products as gifts for daughters and wives.

You might test this hypothesis by firing up a new ad campaign targeting dads, explaining how your products make great gifts. If it works, you just identified a new key customer demographic. From there, you can build a more complete marketing funnel, driving substantial traffic and revenue.

Specific insights will vary for every data point that jumps out. Keep a keen eye out for such outliers, think critically about the “why” behind them and determine if there’s an opportunity to take advantage (or in the case of a negative outlier, improve).

3 – Identify Top-Performing Channels

Compare your web traffic by channel in the Acquisition >> Source / Medium report. Knowing which channels drive the most revenue and highest ROI, you can optimize resources and maximize returns.

Just like you can discover new customer segments worth targeting, you might find that one of your lower-traffic channels earns a high conversion rate, in which case you would reallocate budget toward scaling impressions in that channel.

4 – Observe User Behavior

Use the Behavior report to find insights on what users are doing once they arrive at your site. Within this report you’ll be able to look at time on page, bounce rate and other performance indicators. There is no universal benchmark for these metrics – they vary by industry, product, target audience and other factors.

Various pages within your site should have drastically different targets for these metrics, as well, depending on their nature. The bounce rate on your home page, where users will hopefully explore your site further, should be much lower than, say, a targeted landing page, which has a single, conversion-focused purpose.

If you have ecommerce tracking set up, you’ll be able to see things like which product pages are performing most efficiently. Metrics like cart-to-detail (CTD), cart-to-buy (CTB) and page value can have direct implications for revenue-driving campaigns. For instance, product pages with a high page value or CTB ratio might be a good place to direct traffic through product display retargeting ads. Worse-performing product pages could be in need of optimization.

5 – Understand Customer Journeys

Google Analytics attributes 100% of credit to the final touchpoint before conversion (know as last-click conversion). This method of attribution doesn’t always paint the whole picture, favoring sources that tend to lead directly to purchases (like direct, email or paid search).

Explore the Conversions report to build a better understanding of your customers’ full journey. Look into top conversion paths to see all the ways your website users arrive at purchase. This will show how channels interact and can help identify the source of traffic or the specific campaign that started a customer on their journey, even if the ultimate conversion came from a different source.

You may find that some channels or campaigns are involved in many of your customer journeys, but are rarely the last touchpoint, indicating they are working better than conversion figures, alone, would suggest.

Conclusion

Google Analytics is a robust tool that provides an intimidating amount of data to look through. Being able to properly stack the data points against each other will help you turn this mountain of information into a data-driven marketing strategy.

Knowing who your users are (Audience), where they’re coming from (Acquisition >> Source / Medium), how they interact with your site (Behavior) and how your marketing channels integrate with and support each other (Conversions) will help you build a strong funnel with appropriately allocated budget and resources.

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