How To Run A Data-Driven Business Using Google Analytics And Why Is It So Important?

Importance of Google Analytics In Business

This blog post will help you understand the Importance of Google Analytics In Business and its role in making wise business strategy decisions.

 

Importance Of Google Analytics

 

Why Data Analysis And Measurement Is Very Important?

 

Do you know which is one of the most critical factors for any business to fail? It is a lack of analysis and measurement of every parameter (data ) responsible for its business growth.

Most of the times, business owners, managers and heads of organizations blindly blame their strategies for business failure. But, little do they realize, that, a small tweak in the strategy, on basis of the real-time facts and data (about the customers and their interests) could have taken their business positively to the next level.

Several types of research have proved that a sinking business can be saved (or business could be further improved) if the right analysis and measurement has been put in place.

Let’s not forget that, in any field – “something that cannot be measured, cannot be managed”. Without measurement, it is highly impossible to manage and achieve the desired end-results.

There are many businesses which collect data from their customers, but other than knowing the averages and menial information, they do not go beyond it, to understand their buyer’s persona in detail. The reason being – ignorance or sometimes, lack of resources to do the extra data collection work. Whatever may be the reason, that’s a bad sign for the business.

A business that analyses data in a right way can make a strategic plan that has an affinity towards becoming a successful company (say, chances being 9 on 10 ) than a business that does not consider analyzing their data strategically and more seriously.

In this blog, you will understand how to analyze website visitor data and how to use the analyzed data in your businesses. We will be exploring a free tool (which is mostly underrated) called Google Analytics through which you can generate adaptable and functional reports that can help yourself and the team to understand how data works and can impact your business. After reading this blog post, you will be able to appreciate the importance of Google Analytics In business.

Let’s deep dive into the world of Google Analytics and understand its importance For business.

 

Know How These 5 Types Of “Report Sets” in Google Analytics Can Help You Take Powerful Business And Marketing Decisions

 

In order to gauge everything (demographics, behavior, interests, etc.) about your website traffic, you have to install Google Analytics – A important first step towards data analysis and measurement.

Google Analytics is a web analytics service offered by Google that tracks and reports website traffic, provides statistics and basic analytical tools for search engine optimization (SEO) and marketing purposes. Google Analytics is the most commonly used tool for collecting data about your website visitors.

Once Google Analytics is installed properly on to your site, the tools start fetching the data based on traffic it receives from your site. This data will help you in building the right business and online (or even offline) marketing strategies as well as customer acquisition strategies.

For example, the tool can report how many people have visited your website/webpage through desktop, mobile or tablet devices. Using this data, you can figure out, which device brings the most traffic to your site, and based on this, you can target to reach your audience appropriately.

NOTE: If you wish to install Google Analytics on to your site or want to know more about it. Please visit the Google Analytics Help Center.

Google Analytics is equipped with different reporting channels to serve different purposes. Let me take you through each one of the reporting sets to get a better understanding of it.

 

Types Of Reporting Set In Google Analytics - Importance Of Google Analytics

 

1. Real-time Report Set:  Real-time means – at that instant or at that moment. You can know how many people are visiting your site at that moment of time with the details of the web pages that they are currently viewing, their location, the source of traffic and keywords they have used to reach your site.

 

real-time-data-google-analytics

 

2. Audience Report Set: This sub tool gives us information about people. It gives us information about their age, gender, demographics, technology (a device they have used to reach your site) and their interests.

3. Acquisition Report Set: This sub tool gives us insight into the source of visitors. For example, what keyword or keyword phrase is used to visit your website or from where they are coming to visit your site.

4. Behavior Report Set:  The report is based on what action people take on your website when they visit your site which includes the unique page views, average time on each page, bounce rate, exit rate and more.

5. Conversion Report Set: As the name suggests, it gives the detailed report on whether the users visiting your site have reached the goal (set by you in the tool will be discussed later in this blog post) or in other words, has the lead converted to your customer. For example, subscribing to your blog or buying a product from your site is considered as a conversion.

In fact, all these Report Sets further get divided into multiple sub-reports. Drilling down on to each and every kind of sub-reports gives you a variety of inputs and answers for below three things:

  • What is happening currently with my business?
  • Where and how your marketing budget should be doubled?
  • Where should the cost-cutting be done?

All the above report sets can be generated only when users visit our site. So it’s important to know where our visitors are visiting the site. Below section explains you everything you should know about sources of traffic.

 

Understanding The Sources Of Your Traffic Using Google Analytics

 

You should know what are the means through which the website users visit your site. The Acquisition overview report of “Acquisition” Report Set gives the complete details of the various channels through which you get your visitors. This is the first report you need to check for gauging the health of your website.

Let us see the common sources of traffic, tracked by Google Analytics in your site:

 

Channels In Google Analytics - Importance Of Google Analytics

 

  1. Organic Search: Infers to the people visiting your site by typing the keyword in the search box of any search engine like Google, Bing or Yahoo.
  2. Direct: Infers to the group of people who directly paste your domain (complete URL) and visit your site. When your site is bookmarked and visitors come to the site through bookmarking, it is counted as direct traffic.
  3. Paid Search: Infers to people who click on PPC ads displayed by you in Search Engine Result Page(SERP) on top and bottom by the Google.
  4. Email: Infers to people who visit the site after clicking the link in the emails and newsletter sent by you.
  5. Referral: Infers to people who come to your site from a different site like forums. For example – Quora.com 
  6. Social Channels: Infers to people visiting your site using Facebook, Twitter or Instagram.

We have just seen the high-level view to know the source of traffic, now let us get our hands dirty by digging more into the granular level. The below section describes detailing of the traffic sources.

 

Deep Granularity Using UTM Parameters

 

We noticed the source/origin of the website visitors in the acquisition report. But the point to be noted is that they are not detailed. It means it lacks a deeper meaning. In simple words, it lacks more granularity.   

Let me make it more clear with an example. Assume you run multiple ad campaigns through Google Ads, Facebook Ads, and Banner Ads. Now, after a day’s time, you wish to know how many visitors reached your site through each of these Ads you created.

Ideally, the default settings of Acquisition Reports will help you get the total count of people who visited your site through various channels on a broader level. That is, it only says, how many people visited your website through Ads. 

If you have run serious PPC Ads, you will know the fact that, for each set of Ads, we might run different campaigns. The default settings of “Acquisition” Reports is to give you a broad overview and not granular view of individual campaigns within each ad.

Therefore, in order to find, from which individual Google Ads campaign (or Facebook Ads Campaign or Banner Ads Campaign) or to know which individual Ad has got how many visitors to your site, you need to append UTM parameters to the links of the webpages that you use for promotion.

UTM stands for Urchin Tracking Module. The UTM is appended to your website URL in order to make them unique and also make it easy for you to track the exact source of your website visitors.

You can keep it as a thumb rule, any URL you wish to track, append it with UTM parameters to know the exact source of your visitors. The UTM consists of various parameters as discussed below. Let us see how these parameters make the URL unique.

1.utm_source (Campaign Source)

This parameter indicates the source of the visitor to your site or from the place where the referring link is being shared.  It can be through Facebook, Google Ads or through Email campaigns.

In simple words, it identifies the advertiser, website, publication, etc. that is sending traffic to your web property.

2.utm_medium(Campaign Medium)

This parameter identifies the medium used by the visitor to reach your website. They can be through an email, Google ads or Referrals from a third party site.

3.utm_content( Campaign Content) [Optional Parameter]

The content parameters go more into detail in order to understand which ad or banner of which campaign the users are visiting. It is recommended to make it little descriptive in order to understand the ad copy.

4.utm_campaign(Campaign Name)

The campaign name is the name of the event you have created. In simple words, the campaign can be the end goal that the link achieves after a visitor visits your webpage. It has to be consistent throughout in order to track it easily.

For example, assume you have a landing page created for visitors to register for a 1-day event or a 1-day workshop. In this case, the campaign name could be – “1-day-workshop-10-April”. It is being used as a campaign name for easy understanding.

If you are promoting through Facebook banner ad then you can append the above campaign name with “fb-banner” or if you are also promoting it via Google Ads then you can append it with “google-ads”.

5.utm_term(Campaign Keyword) [Optional Parameter]

The “term” parameter identifies paid search keywords. You should use “utm_term” parameter to specify the keyword used in the campaign if you are manually tagging paid keyword campaigns.

 

An example link with UTM parameter appended is shown below. If a link is placed on a blogger’s website as a banner ad for running campaigns to get leads for a training business, the link with the UTM parameter looks like this:

https://www.example.com/?utm_source=blogger-website&utm_medium=banner-ad&utm_campaign=leads-for-training-business

To see it working, copy the URL (of course with your business URL) and paste it into the new incognito browser window and take some action on it. Go to your analytics reporting section, click on the “Real Time” reporting set, and finally click on the “Traffic Sources” sub-reporting tool. You can find your UTM parameter information as shown below.

 

UTM-Parameter-Testing-In-Google-Analytics-Real-Time

 

Another way to do it is to click on the “Acquisition” reporting set, and then, click on “Campaigns” sub-reporting tool. You can find the details there in the “All Campaigns” section. See the below figure.

 

UTM-Parameter-Testing-In-Google-Analytics-All-Campaigns

 

It might take several hours to reflect in this section. So do not panic if you don’t see it here immediately.

To Learn More: Collect Campaign Data With Custom URLs 

By now, you would have understood how important and useful it is to track the URL using UTM parameters.  Having known UTM and its parameters, now you should know how to create such URLs for your website.

 

How To Create UTM Parameters For Your URL

 

Google Analytics provides a free tool called Campaign URL Builder . This tool helps you in adding your UTM parameters to your URL thereby making the tracking of campaigns easier.

Now you know how to get to the granular level to find the source of our traffic. Now it’s time for you to know what actions are performed by users when they visit the site and how do we track it. In the below section, we will be discussing it.

 

Track User Actions By Creating Goals

 

You will see how to create or set up goals in Google Analytics. Goals provide a way to gauge the set of actions we expect the visitors to do when they come to our website. Apart from the count of people who is taking up specific actions, “Goals” will also tell us which group of people, with what behavior and demographics are interested in achieving that goal. All thanks to UTM parameters with which we can track down the source easily.

Let us take an example, assume you are conducting a 1-day event on Digital marketing Training.  You are creating a campaign on Facebook for it. You have a landing page where the visitor has to submit his/her details and then on a new page you thank the customer for joining the event. Let’s name that page as “thankyou.html”

You want to know how many people have registered to your event through this campaign and how many have seen congratulation page.

You can know the count of people who have clicked the ad in your campaign through UTM parameters. But to know the successful registration count, you have to create a goal in the congratulation page (the logic is simple, every time a user is directed to congratulation page after filling the details, the count of the goal increases by one)

Now let us see, how to create a goal in Google Analytics.

  1. Go to Google Analytics -> Click Admin
  2. Under Admin -> View Section -> All Website data ->  Click Goals
  3. Click the + New Goal button to create your brand new goal.
  4. In the Goal Setup page, scroll down and select the goal type you think is ideal -> Click continue (I have selected – Newsletter Sign Up in the example below)
  5. Name your Goal -> in type field -> select “Destination” -> Click continue
  6. Set the requirements of the goal.
  7. Click Save

In our example, the goal URL is a “thank you” page. Therefore, “Destination” Equals To “/thankyou.html” is the selected option. Keep in mind not to mention the full URL – “www.example.com/thankyou.html”. See the below figures for better understanding. 

 

Google-Analytics-Goals-Setup-1

 

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Google-Analytics-Goals-Setup-2

 

3.

Google-Analytics-Goals-Setup-3

 

4.

Google-Analytics-Goals-Setup-4

 

5.

Google-Analytics-Goals-SetUp-5

 

6.

Google-Analytics-Goals-SetUp-5

 

Hurray! You have created your first Goal.

After a few days of setting up your goal, you can check the collected data and review it. You get a better insight into the type of people who convert from visitors to customers and also the channels through which you are getting the maximum visitors to achieve the goal.

 

Where Do I Check For Goals Insights?

 

Go to the “Reporting Section” of Google Analytics and choose the “Conversion” tab in the left menu. Click on the “Goals” drop-down menu and click the “Overview” tab. The “Goal Overview” report opens and shows the details of the performance of those goals you have set-up. Play around with the tool and within a few days, you will become an expert at it. Trust me. 

UTM Parameters with Goals insights combined can give you a greater amount of details about visitors, converting customers, visiting channels and a lot more. These data collection is very important for any business so that you can make educated decisions as you grow.

 

Audience Segmentation With Google Analytics

 

You would have understood how to fine-tune your campaigns and build ads in particular channels to track success using UTM parameters and creating goals.  With all these important details, you can segment your audience based on conversions, actions completed, the source of traffic and channel.

In other words, if you wish to see the data about a group of your website visitors who complete a specific action or based on the specific device they are using or based on specific age and gender, then, Audience segmentation is the key.

Let’s now learn how to segment data in Google Analytics.

With respect to analytics, a “segment” means a set of users with the same characteristics and behaviors. Segmentation is simple and helps you plan your budget wisely and cut down on expenses which give you less output. In simple terms, you get to know what works and what does not work.

It’s a powerful piece of information that helps you take the right strategy driven decision. Now let us see how to create useful audience segments and drill down into these segments to understand the users who are taking the actions that we are expecting.

 

How to Create Audience Segment In Google Analytics

 

Creating segments is very easy. Using these segmented data, you can apply strategies based on the types of audiences segment you are dealing with. Let us see how to create audience segments to pull out more information. You need to create a bunch of rules in order to focus on the actual audience you are targeting which in turn helps you to analyze better and get more insights.

Below are the steps to create segments:

  1. Navigate to the reporting section of the Google Analytics Tool
  2. Select the “Audience” report set and in the drop-down, click the “Overview” sub-tool.
  3. Click the “+Add Segment” option at the top of the page
  4. Click on the “+New Segment” button to create a new segment.
  5. Set the required conditions for your segment based on the type of audience you need to focus by checking out the conditions you require.
  1. Technology: Segregate your visitors based on devices, operating system, and web technologies. Check the more specific options inside the technology field to narrow down your audience.
  2. Demographics: Segregate your audience based on geographic locations, age, and gender. Check more specific options checkboxes to narrow down the audience of your interest.
  3. Behavior: Segregate them based on the number of sessions, the time taken for each session, the day since the last session. They don’t have checkboxes, these are form fields.
  4. Traffic sources: Segregate based on the channel or medium they used to reach your site.
  5. Sequences: Segregate based on the sequential pattern followed by your audience when they visit your site. This is a form field.
  6. Conditions: Segregate the visitors and their sessions or both according to single or multiple sessions. This is a form field.

      6. After setting the required condition, name the field of your segment filling out the empty field at the top.

See the below figures for better understanding. 

Google-Analytics-Segmentation-1

 

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Google-Analytics-Segmentation-2

 

3.

Google-Analytics-Segmentation-3

 

4.

Google-Analytics-Segmentation-4

 

5.

Google-Analytics-Segmentation-5

 

Voila! You have created your Audience Segment. Once the new segment is loaded, the segment gives you all the important stats which can help you take powerful decisions.

Now, go ahead and check the other stats on the Google Analytics and you can find the data would give you analysis based on your segment set. Do not forget to check the stats on “Audience” reporting set, in the “Overview” section.

NOTE: Segmentation is not limited to “Audience” reporting set and can be applied to other reporting sets too.

 

A tutorial video about segmentation is here:

 

Deep Drilling the Audience Further Down – “Demographically” And “Psychographically”

 

You have segmented the audience. Now you can run those reports and drill down further to understand which report works well and which is not working so that you get an idea about who are your real customers, and towards whom you should drive your ad costs and where to cut it down.

You have to look into two types of data:

  • Demographics data describes how people are like. It exactly tells you what kind of people you are interacting to. Data is based on details like age, gender, and location.
  • Psychographics data describe what people like. It plays an important role when you are crafting the messages or emails you wish to send them.

 

How to create Demographic Report In Google Analytics

 

To create a custom Demographic report, you need to follow the below steps.

1. Go to the “Customization” section in Google Analytics and select the “+New Custom Report” button.

When the “Create Custom Report” page open, you can create as many separate custom reports you want to track demographic details like age, gender, location, and device type.

2. In the “Report Content” section of the “Create Custom Report” page, create “Report Tabs”

You can name the tab based on the demographic you wish to track down like age, gender, location, and device type. If you wish to track and measure multiple demographics in this report, you can create a new Report Tab by clicking the “+Add Report Tab” button undress the “Report Content” section. You can name each tab for the demographic you are tracking or measuring.

3. Set the “Metric Groups” dimension on the same page to “Users” by clicking the “+Add Metric Group” button and then select “Users”  from the drop-down menu for every “Report Tab” you create.

As you see the word “Users” will now be displayed in the “Metric Groups” dimension and note that, “Users” will be constant among all your tabs. 

4. In the “Dimensions Drilldown” dimension, on the same page, set the demographic for each “Report Tab” you create by clicking the “+Add Dimension” button.

For Age, the “Dimension Drilldown” is “Age”; for Gender, its “Gender”, and for Device its the “Device” category. In the “Dimension Drilldown” dimensions, you can see your respective demographics has appeared.

For “Location” demographics, there is a small difference. Unlike, Age, Gender and Device, for the “Location” demographic, select the “Type” option as “Map Overlay” and it enables you to set it based on your required location type.

 

Google Analytics Demographics Report

 

5. Click the “Save” button once you are done.

You now have a ready-made custom demographics report to use repeatedly.

 

Below sections tell you what to dig in these demographic reports to gain more insights to run a successful yet money-saving Ad campaign.

  1. Age:  Verify the age group of people who are responding to your campaign. Who are opting in and who is not. See whether the age group in the ad copy is performing well or not. Based on this analysis, you can reduce the cost per click of the ad as you get an idea about the age range who are ready to opt in.
  2. Gender:  When you know one gender is opting for your campaigns more, compared to the other gender. The second ad copy you create, you can focus on one single gender, thereby increasing the conversion and reducing the cost per click.
  3. Device: Examine the devices that were being used to opt-in for your campaigns. Based on the percentage of the devices used whether desktop, tablet or mobile. While creating an ad campaign, we can target a specific device through which more visitors pool in.
  4. Location: This data set plays a crucial role particularly if you wish to extend your market to a new location. If you find your campaign is doing very well in one of the new regions than expected, then you can allocate your ad budget on that location which will increase the opt-in for your campaigns by reducing the cost per click.

For “Location” demographics, there is a small difference. Unlike, Age, Gender and Device, for the “Location” demographic, select the “Type” option as “Map Overlay” and it enables you to set it based on your required location type.

Till now, we discussed the data set dependent on the demographics. As mentioned earlier, this helps in fine-tuning the group of people who will mostly opt-in for your campaigns.

Now let us dig through the psychographic data in order to understand the customer behavior and their interests.

 

 How to create Psychographic Report In Google Analytics

 

Again we are here to create one more custom report but this time it is based on the “Affinity categories” (what customers are interested in or what customers like) and “In-market segments” (what customer wishes to purchase).

To create a custom report, you need to follow the below steps.

1. Go to the “Customization” section in Google Analytics and select the “+New Custom Report” button.

When the “Create Custom Report” page open, you can create as many separate custom reports you want to track Psychographic reports – either – “In-market segments” or “Affinity categories”.

2. In the “Report Content” section of the “Create Custom Report” page, create “Report Tabs”

You can name the tab based on the psychographic data you wish to track down like either “In-market segments” or “Affinity categories”. Click the “+Add Report Tab” button undress the “Report Content” section to create two reports for each. You can name each tab for the demographic you are tracking or measuring.

3. Set the “Metric Groups” dimension on the same page to “Users” by clicking the “+Add Metric Group” button and then select “Users”  from the drop-down menu for every “Report Tab” you create.

As you see the word “Users” will now be displayed in the “Metric Groups” dimension and note that, “Users” will be constant among all your tabs. 

4. In the “Dimensions Drilldown” dimension, on the same page, set the demographic for each “Report Tab” you create by clicking the “+Add Dimension” button.

For In-market segments report, the “Dimension Drilldown” is “In-market segments”; and for “Affinity Categories” its the “Affinity category”. In the “Dimension Drilldown” dimensions, you can see your respective demographics has appeared.

For “Location” demographics, there is a small difference. Unlike, Age, Gender and Device, for the “Location” demographic, select the “Type” option as “Map Overlay” and it enables you to set it based on your required location type.

 

Google-Analytics-Psychographic-Report

 

5. Click the “Save” button once you are done.

You now have a ready-made custom psychographic report to use repeatedly.

 

The below dataset tells you, how to dig more into these psychographic reports.

Affinity Category Report:

This report interprets what the audiences are interested in or like. This powerful information from the report helps you build custom campaigns specifically based on the interest of your customer. Through this report, you can hone the messages you send to your customers related to their interest which in turn reduces the click-through rate per ad and increase the opt-in for your campaigns.

In-Market Report:

The in-market segment gives the user an idea about what the audience in the market wants to buy. This is again a powerful piece of information allowing you to target based on the products and services they are interested in.

When you know what your customer’s interest is. You can create separate ad campaigns based on the interest to a specific group of people which gives a high ROI and more opt-in for your campaigns.

 

Conclusion

 

Equipped with proven information from your custom reports based on demographic and psychographic data. Now you can have a very clear idea on who is your ideal customer- the one who fills the opt-in form for your campaign.

You can stop guessing now as you have facts and data right in front of you for optimizing and improving your campaign which in turn helps in reducing your ad budget and click through rate.

Here is a template on the information you will be gathering based on all the reports generated above.

  • Gender
  • Age
  • Device used
  • Income Estimation
  • Location
  • Role at work
  • Likes and Interest
  • Dislikes

Don’t you think, filling all these information above, gives you the complete idea about your buyer’s persona? Based on my experience, it definitely does!

You can take this profile of your customer to create campaigns which can help you in being more targeted. Imagine the benefit of using this information in paid ad campaigns. The targeting and quality will definitely reach the next level with more fruitful results.

Hope this blog was able to convince you about how important are data to the business; and in specific, the importance of Google Analytics In Business.  Thanks for reading my blog.

For any queries, please comment below.

 

Wish to learn Google Analytics In-Depth?

Take up our Google Analytics Training In Bangalore.

 

Subhash.K.U is a Professional Programmer turned Digital Marketing Enthusiast. He is the most sought marketing consultants for small and medium scale businesses. He founded Subhash Digital Academy to teach professional digital marketing skills to students, entrepreneurs, and working professionals. He holds a Bachelor’s degree in Electrical Engineering and is an Oracle Certified Programmer. He also holds certificates of Google AdWords, Facebook Blueprint and Hubspot Marketing. He is the co-author of the best selling book – Cracking The C, C++ and Java Interview published by McGraw Hill. He is now penning another book on the subject of marketing and entrepreneurship.

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