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Web analytics may not seem like a hot topic to some. But the use of web analytics in my opinion has gained much popularity since the introduction of free tools like Google analytics. I think that this is great because it shifts general focus from the state of promotion, to user behavior of a website. Ultimately those that are able to understand their web users are in line to win the game in the long term. Why? Anyone can purchase advertising, but getting your target demographic do what you want them to do is real art.

One fundamental question that your business must ask when choosing web analytics is whether you need a free or paid service. What seems like a no-brainer kind of question, is really not all that simple. First, there are literally some companies that believe that because they have the most expensive solution that it’s the best for their needs. Oh yeah, except of course when you ask them how they use it, only to find out that not even the IT guy knows how to interpret a simple report. Then there are companies that run multi-million dollar businesses that use free solutions because the sheer cost of a paid solution appears too high to incur.

Believe me when i say that there is no perfect or magic solution that fits all. Foremost, the solution that you choose should match to your overall experience with web tracking along with your business goals. In the senarios above, i would say that purchasing a solution that you wont utilize is probably the worst followed by a free solution that is out of its league when it comes to business goals. Which leads to a fundamental question:

Which web analytics program is right for by business?
In my opinion, there are three key components that web analytic programs offer:

1. Traffic- knowing where your visitors come from, whether you paid for them or not, and where they go when they get there.
2. Trending- basically identifying site wide user behavior & identifying what actions visitors are taking.
3. Automation- using statistical programs to aid in making purchasing decisions.

The first two components believe it or not, can be handled by most free analytic programs like Google, StatCounter, and soon to be released Yahoo! Analytics (formerly, IndexTools.) As a general rule of thumb, if you have over 50K unique visitors a month and use your website for lead generation or e-commerce, I would recommend using a paid solution.

The last component relates to automating the tough task of monitoring your paid advertising programs as well as user behavior. This comes in very useful in managing very difficult campaigns that require the aid of electronic automation to anticipate user behavior. For example, if your website garners 100’s of purchases or leads per day, a bid automation plugin would significantly help reduce waste expenditures as your watchful eyes likely cannot micro manage 1000’s of keywords. If you find yourself in this predicament, a professional solution like that is offered by Omniture or Coremetrics is a wise investment.

As i stated above, choosing the right solution is not an easy task. If your new to the whole tracking game, you might consider free analytical package is best while you learn the ropes. However, if you expect your startup to become a multi-million dollar web property overnight, perhaps a paid solution will have a better pay-off in the long run as you gain more familiarity with the program. Lastly, if you are not sure whats best for your business, ask a company that has experience with web tracking or choose a web analytic supplier that has live support/training. Regardless, staying on top of your web analysis is a wise decision no matter how you slice it. Its just a matter of how you interpret it.