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You recently revamped your firm's website or are planning an online marketing campaign, but are not really sure what you'll gain in return? Website analytics is a science whose aim is to answer such questions.

In this piece, we'll take a look at the benefits of web analytics and ways to optimize its tools.

Bet you're already thinking this is geeky stuff! But if we get rid of the jargon, website analytics simply means the study of the impact that a website has on its users. For example, what are the pages that most visitors spend time on? Which products sell best online? Is the registration process a turn-off?

But that's not all. Web analytics software can provide a whole lot of information in fine detail, thereby bringing valuable insight to marketers looking to refine their online strategy.

Things you can do using website analytics

Understand visitor behavior: Monitor the number of visitors and where they come from, understand how they navigate your site and what keywords they like, or get a feel of whether your site is meaty enough to hold their attention. An extreme example would be a study of visitor behavior on BBCi Search Service, which found that 1 in 12 search terms were misspelled!

Study advertising effectiveness: The U.S. online advertising market is booming, and set to cross US$ 16 billion 2009. That is almost twice what it was in 2004! Sooner or later, you'll find yourself contemplating an Internet driven campaign. Website analytics will enable you to find out how your website shows up in organic and paid searches, which banners are being clicked on the most and which affiliate sites work best. It could also help you review the performance of different keywords and judge whether you need to tweak those that haven't delivered.

Evaluate online sales: Let's face it! Your ultimate objective is to drive sales, and you'd rather put your money elsewhere if your online initiatives are not turning the cash registers. Your web analytics software will create reports that can tell you what kind of sales are being generated, how many customers return, who are the prospects and so on. And from that, you can calculate the ROI of your campaign.

On the flip side, website analytics may also tell you if your competitor is inflating your advertising costs by repeatedly clicking on your 'pay per click' banner!

How to make the most of your web analytics reports

Choose carefully: Identifying an appropriate analytics vendor is paramount. Check their credentials ' while there are lots of free sites, they might provide nothing other than visitor counts. Quality suppliers offer a basket of products ' tailored to clients' specific business needs.

Ask why: While analytics software can be a very effective tool, it's important to know how to use the insight that is generated. That's no different from say, a supermarket, where candy is placed near the checkout, because experience has shown that customers will buy it on impulse. Let's assume for a moment that your analytics report says that lots of people drop out before reaching the 'buy now' page. Could this be due to a technical error which makes the page unreadable on some browsers? Or is it just too cumbersome to complete a transaction?

Take a second opinion: It is a good idea to have your website analyzed by a professional (in case you don't have the expertise) to see if the analytics reports suggest the need for a change in site layout. Often, a format that facilitates intuitive browsing will work better than a rich but intricate structure.

Know where you're headed: Most important, clearly define your website's objectives.

Do you want it to provide information or prompt a specific action? Are you looking to generate leads or close a sale? The answers to these questions will determine the depth of your requirements. Only when you're sure of where you're going, will website analytics be a useful navigator!