Digital Marketing and Web Analytics: THE BASICS OF “SHOW ME THE MONEY” – Part 2 Ted Dzialowski – PLUTUS Consulting Group

This is the second in a series of a three part article on Web Analytics as part of our Digital Marketing information.These articles provide an Executive Summary on the “what and how” basics of Web Analytics as a demystifying starting point for those who are thinking about or starting into web analytics, are reviewing consulting proposals or need a quick “Show me the Money” refresher and reminder. Portions of these articles were published by the author in the “Franchising World” Magazine, a publication of the International Franchise Association. Plutus CG Ted Dzialowski

Part 1 will introduce the topic of web analytics. ( click here to read part 1 )

Part 2 will describe the different components of web analytics that involved in an overall digital marketing strategy and illustrate a quick business case and ROI methodology.

Part 3 will identify different performance analytics tools and solutions that can employed in digital marketing and web analytics to measure marketing performance and ROI.

This series of articles provides an overview of digital marketing to Executives and Business owners while keeping an eye on the ROI.

Marketing Guru’s or Marketing Gamblers? Who is Signing the ROI Cheque?

Digital marketing and analytics allow businesses to deploy digital marketing strategies and campaigns and to track critical marketing and sales key performance indicators such impressions, lead flow, sales conversion, customer acquisition cost on a volume and ROMI (return on marketing investment) in real time. Unfortunately, the old axiom that “50% of your advertising works – -but you don’t know which 50% it is” still applies to digital marketing despite all the real time analytical tools and “bright people” that make the marketing and advertising decisions.

In a September 2012 survey, the Chief Marketing Officers Council who found that only 1 in 4 senior marketing executives said they had so far achieved “good results” from their mobile marketing, indicating that getting a solid return is still proving to be a problem.

“Indeed, when asked what they need to do in order to be able to add mobile marketing talent to their organizations, 68% of the Aquent survey respondents said they need to prove that mobile marketing has a positive ROI. Asked to name their 3 biggest challenges with mobile marketing, a leading 42% of respondents pointed to measurement/ROI, ahead of other primary challenges such as reaching the correct audience and data security (each at 34%).”

Yet despite the poor results or an unsatisfactory ROI, “6 in 10 survey respondents – who were required to make or influence their company’s mobile marketing strategy and hiring decisions – said they expect their mobile marketing budgets to increase significantly (15%) or slightly (45%). But while their budgets will increase, their concerns about ROI look like they’re persisting.”

In 2012, General Motors decided to stop advertising on Facebook when “everybody” said you need to be on social media and on Facebook. While a variety of factors when into their decision, ultimately, there was no return on their marketing dollars and the Facebook funds could be reallocated to advertising that produced better ROI. In short, Facebook “likes” did not translate to sales leads and conversions – -despite all the social media “hype”.


In part 1 of this series on Digital Marketing and Web Analytics, we reviewed the basic components of digital marketing and web analytics. Firms from start-ups to the fortune 500 develop brand and advertising strategies, tactics and campaigns for a variety of digital marketing channels. Web marketing, ecommerce, search engine optimization, pay per click advertising, social media, mobile geo location, personalized marketing, loyalty programs, coupons, group buying sites, etc. often complimented and linked to traditional marketing newspaper, mail, television or radio advertising. As shown below, internet (digital) marketing sale ROI has emerged as the leading marketing medium over traditional advertising channels.

roi chart

So while the opportunity is great – – there is a bigger problem of maximizing and optimizing ROI given that, as illustrated below, there are thousands of Digital Marketing channels – – all claiming that they can deliver “great” results.


The reality is that most businesses can’t gamble and place bets on every number on the marketing roulette wheel and risk is further increased as digital marketing innovation, change and adoption cycles are very short. While marketing and advertising program and channel selection decisions are made on the basis of number of strategic, brand, creative, customer and financial design and decision criteria – – at the end of the day the ROMI is the most important decision criterion for budget allocation and marketing program prioritization.


logos image


We will examine the range of tools digital marketing tools that can be deployed and provide a practical marketing campaign business case method to calculate the ROMI for digital marketing. This business case approach should be applied to evaluate the merits of individual campaigns, for comparative purposes and for budgetary planning and accountability.



Web Analytics consists of onsite and off-site methodologies. On-site web analytics tracks and measures a visitor’s progress experience when they are within a specific web site. Off-site web analytics because it measures a web site’s comparative potential and competitive performance across the internet.

Various Web Analytics components are shown in the Payoff Matrix in terms of ROMI, the Level of Digital Intelligence provided by data, the Capability to Execute in terms of cost and/or sophistication and the potential Competitive Advantage derived on low to high scales.


matrix chart


The left quadrants reflect many of the available tools and tactics that can be readily deployed through Web Analytics which range from Web Traffic Statistical Reporting to Personalized Ad Targeting. The right quadrants reflect components that could require more extensive specialization, cost or resource commitments. The particular positioning of different components is dependent on factors such as firm size, markets and business model. While Specialization components may promise competitive advantage and high ROMI – – the driving assumptions, methodologies and quality of data from digital and non-digital sources and execution cost will determine the precise ROMI.

Firms starting in proactive Web Analytics should be engaging in the “Easiest” Quadrant and move up. More mature Web Analytic tools and solutions can evolve using inside resources, specialized software solutions or outside consultants. There are a number of specialized tools and solutions within each component that can be utilized.

It is important to align the goals and indicators in applying each of the components and tracking marketing budget, cost and ROMI for each component, initiative, solution on a standalone basis and a total digital marketing basis.




Some rules of business do not change just because everything is digital and “sexier”.

The famous consultant Drucker stated that the purpose of business is to create a customer and figuring out how to get the customer to buy.


Web Analytic strategies must enable and align with business goals and budgets to drive the “show me the money” return on marketing investment (ROMI). Analytical optimization must to be translated into “show me the money” financial outcomes and consequences as money is made or lost with every click. Statistical results and reports must be connected to a financial impact on a unit and aggregate basis for every goal and KPI. Every time a potential customer visits a competitor’s web site – – or leaves your page web – – or does not complete an order transaction – – or posts a positive or negative review creates financial impact. Multiply each click by your potential customer universe – – and the overall revenue or cost financial impact and ROMI add up. Again, “show me the money” we made – and “show me the money” we lost – – and “show me what we’re going to do to make money”.


The following table illustrates a simple ROMI calculation for Web Analytics which be used to demonstrate ROMI for planning and/or reviewing actual results.

romi example


The “how” discipline of managing and monitoring Web Analytics execution against goals occurs when align analytical optimization goals as your KPI’s for digital marketing sales funnel and measure actual performance and derive financial consequences. The ongoing detective work of analytics optimization lies in utilizing forensic cause and effect tracking of KPI drivers throughout the sales funnel from customer acquisition to sales conversion within a web site and within web pages to understand and influence buyer behavior to gain sales conversion transactions. While KPI’s share some of the same attributes as traditional marketing measures, the ability to “drill down” into ever changing digital marketing and sales information provides tremendous marketing strategy proactive execution and forensic performance management capability.




Part 3 of this series will examine the Digital Marketing Sales Pipeline, review specific digital marketing performance and ROI indicators and summarize some of the free and commercial digital marketing analytical tools.


We will examine various web analytics tools from the key search engine, software and consulting firms and review the analysis framework and reporting.


While the programs very in the degree of monitoring and reporting sophistication and cost, some of the essential and common Goal Setting and KPI Dimensions are outlined below.


  • Sources, Volume, Cost, Conversion, $ revenue, costs on a unit, total basis, demographic or geographic basis
  • Numeric, trend, % change, ratio, ranking, predictive
  • Comparative periods, segments, individual, variances, alert
  • Results vs. Goals
  • ROI
  • Observe user behaviors, guess problems and solutions from small # of users
  • Engagement or non engagement
  • Track users, usage, conversion %’s for empirical sample # of users
  • Key word analysis
  • Compare what users do in one scenario vs. another scenario
  • Measure which copy, graphics, user interface are most effective
  • Track and compare competitor activity such as key words and web site ranking statistics
  • Compare channels, keyword traffic, demographics, user satisfaction, etc.
  • Social buzz, brand sentiment and comment


Qualitative: Usability Testing / Session Monitoring

  • Observe user behaviors, guess problems and solutions from small # of users
  • Engagement or non engagement

Quantitative: Traffic Analysis / User Engagement

  • Track users, usage, conversion %’s for empirical sample # of users
  • Key word analysis

Comparative: A/B, Multivariate Testing

  • Compare what users do in one scenario vs. another scenario
  • Measure which copy, graphics, user interface are most effective

Competitive: Monitoring and Tracking Competitors

  • Track and compare competitor activity such as key words and web site ranking statistics
  • Compare channels, keyword traffic, demographics, user satisfaction, etc.
  • Social buzz, brand sentiment and comment

Comments are closed.