Digital Analytics Defined: Here’s How They Work (and Why it Matters)

Today’s marketing professionals are under increasing pressure to impress both consumers and C-Suite executives with their marketing efforts. This means keeping up to date with the latest trends, tools, technologies and, of course, customer demands.

To achieve this marketers need to offer personalized experiences to consumers and be able to prove marketing ROI to their boss’. It’s a pretty tall order, but one that is made possible using digital analytics.

If you’re not familiar with digital analytics or the vital role it must play in your marketing strategy, then this guide is for you. Below we’ll define digital analytics and look at why your business needs these important metrics:

• Defining digital analytics
• Why your business needs digital analytics
• 5 sources of analytics and data
• How to integrate data analytics into digital marketing
• 10 digital analytics tools you need to be using
• Final thoughts

Defining digital analytics

In a nutshell, digital analytics is the process of collecting and analyzing data from a range of digital sources, including websites and mobile apps. This data highlights how customers are behaving and allows businesses to enhance and modify their current marketing strategy to achieve the best results.

Why your business needs digital analytics

One in three (32%) marketing professionals identified digital analytics as the most important factor in supporting their marketing strategy over the last 18 months - and with good reason.

Digital analytics provides your business with a solid foundation of data on which to shape your marketing strategy. Without data and the subsequent insights it provides, you’re essentially just shooting in the dark. In fact, two out of three marketing professionals agree that data-based decision-making is a lot more effective than gut instinct. 

To prove just how important digital analytics can be to a business, we’ve pulled together six of the key benefits below.

1. Getting to know your audience

Having insights into the various different behaviors of your audience/customers can help you to create accurate customer personas and ensure you’re giving your target audience what they want.

2. Tracking website performance

Digital analytics allow you to measure online traffic; to see how many visitors you have and where they’re coming from. It also allows you to track bounce rates.

Armed with these insights, you can recognize the most profitable activities on your website. You can also determine at which point people leave and why. This can help you to improve user experience and increase conversions.

3. Optimizing marketing campaigns

No matter where you choose to run your marketing campaigns, through link tracking, you can gather information about how these campaigns have been received by your audience. This way, you can determine what works and what doesn’t, and use this information to create even better marketing campaigns in the future.

4. Increasing Conversion Rate Optimization (CRO)

CRO is about increasing the percentage of conversions on your website or app, making the user do the task you assigned to them, such as making a purchase, signing up for a newsletter, etc.

This can only be done by utilizing digital analytics to find out where your website or app needs improving and what you can do to push visitors to the next stage. The stage in which they complete the intended action.

5. Tracking business goals

Every business should have goals for its digital marketing efforts. Using digital analytics, businesses can set and track specific goals, measuring these to determine ROI and whether these goals are being reached or not.

For example, if one of your goals is to increase the amount of time customers spend on the website, tracking bounce rates, time on page etc., is going to be crucial for analyzing and achieving this.

6. Predicting the future

Digital analytics isn’t just about looking at what’s already happened; it can also be used to predict future trends or challenges.

An example of this might be predicting if and when a product will be more in-demand so that the business can manage its inventory better. They might also see a slowdown of certain products and therefore decide these need to be revamped or removed.

5 sources of digital analytics

Of course, these important metrics and pools of data don’t just appear ready to use. They need to come from reliable sources.

Understanding where data comes from and which metrics to look out for can be extremely helpful in shaping your marketing strategy and winning over new customers.

Here are five important sources of digital analytics you should consider:

1. Website data

There are lots of metrics associated with your website, and these can give you some very critical insights into how customers behave and what you can do to increase conversions. These metrics include:

• Visitors
• Page views
• Sessions
• Time on page
• Bounce rate
• Traffic - by channel and device

2. Data from lead magnets

If you use lead magnets to gather customer data and encourage conversions, you should look at the metrics associated with this content. These might include:

• CTA click-through rates
• Submissions
• Conversion rates
• Newsletter sign ups
• Free trial conversion rate
• Pop-up conversions
• Leads to close ratio

3. Product/ecommerce data

If you’re selling goods or even services on an ecommerce website, there are several sources of data that can give you real insights into your customers, including:

• Shopping cart abandonment rate
• Sales conversion rate
• Email marketing opt-in
• Customer acquisition cost
• Average order value
• Revenue by source
• Transaction histories

4. Data from email marketing

Email marketing is often an important part of any marketing strategy, and it offers lots of useful insights into whether customers enjoy receiving communications from you and whether these convert. These come from metrics such as:

• Open rates
• Opens on devices
• Click-through rates
• Bounce rates
• Unsubscribes

5. Data from social media

Social media has become a vital and highly effective tool for marketing. Each platform also provides plenty of insights that businesses can utilize to better reach their target audience. This data can be gathered from:

• Engagement rates, such as likes or comments
• Followers and subscribers
• Shares
• Audience growth rate
• Post reach
• Potential post reach

How to integrate data analytics into digital marketing

Now, you might already have some analytics tools in place, or you might be planning to invest more time and resources on this in the near future. However, it’s not as simple as just collecting data. You need to know how to integrate this into your digital marketing strategy so you can analyze the data effectively, gain real insights and put these to good use.

Below, we’ve pulled together a list of six of the most useful applications for data within digital marketing, so you can implement this within your business.

1. Personalize the customer experience

A recent report from MarTech Alliance revealed that:

• 80% say they are more likely to buy from a brand that provides personalized experiences
• A further, 42% of consumers are annoyed when content isn’t personalized
• And 72% say they only engage with personalized messaging

By leveraging digital analytics that help you to understand consumer behavior, buying patterns and the content they engage most with, you can implement a much stronger personalization strategy.

The good news is there are plenty of tools out there that allow you to monitor user behavior and turn the data into actionable personalization opportunities - for example, Google Analytics and ActiveCampaign.

Learn more: How Personalization Will Win More Customers

2. Consider A/B tests

One of the best ways to use digital analytics is to run A/B tests that allow you to better optimize your website or campaigns. For example, create one version of your website that has a floating CTA and one that doesn’t and see which leads to more conversions.

You can use A/B testing on pretty much any part of your marketing campaign, so the best thing to do is to decide which marketing channel you want to optimize first and start there.

3. Create great content

Content marketing is a huge part of any digital marketing strategy, and there are loads of tools out there to help make this as effective as possible.

Through digital analytics, particularly using tools like Google Analytics or tracking social media, you can quickly learn the type of content that converts and what is getting the most engagement.

This should influence your content strategy in the future, so you can ensure you’re always creating content that your audience cares about.