What is Web Analytics? Definition, Examples, & Tools

Originally published on March 31, 2022

Web analytics is the gathering, synthesizing, and analysis of website data with the goal of improving the website user experience. It’s a practice that’s useful for managing and optimizing websites, web applications, or other web products. It’s a data-driven practice that helps companies make high-impact website decisions. You might also get ideas on improving your website and driving business growth from web analytics.

Product managers, data scientists, UX designers, and others can use web analytics to enhance their website or product experience and meet customer needs. Here’s how to get started with an effective analytics program and avoid the common problems many data-driven operations run into.

What is web analytics used for?

Web analytics is helpful for understanding which channels bring users to your website. You can also identify popular site content by calculating the average stay on your web pages and how users interact with them—including which pages prompt users to leave. Web analytics features like Amplitude’s Journeys show how users interact with your site.

You can use this information to improve underperforming pages and increase audience engagement across your website. For example, payment processor Square used web analytics from Amplitude to redesign its homepage, creating a new seller journey and making it easier for interested companies to get started with the company. The company continued to iterate on its redesign, gathering data and saw double-digit improvements in key metrics. One key insight: Customers preferred chatting with company representatives over submitting their information in a contact form.

Categories of web analytics

The data you gather about your company’s online performance may come from multiple sources. Two main web analytics types are defined by the source of the data.

On-site web analytics

On-site web analytics measure your audience’s behaviors and interactions directly with your website. This category of analytics can help you track engagement and conversions. Amplitude offers true self-serve analytics to help you understand everything that happens on your site.

The most common type of on-site analytics is page tagging. When a page is “tagged” with a snippet of code, it collects information from each visitor. Page tagging enables you to follow visitors as they engage with your site and watch their path to bounce or conversion. Because you get detailed and real-time data, on-site analytics help you learn what parts of your site are most effective versus those that lose readers’ interest before winning their conversions.

Off-site web analytics

Off-site analytics brings in third-party data suppliers to help you understand your site’s performance as part of the overall market. This category encompasses everything from social media analytics to panel data. These analytics aren’t just about your site: They’re about how you stack up to your competitors.

For instance, your social media analytics tool may tell you your share of social voice, but also that of two major companies also operating in your niche. Your on-site analytics tools might show a steady stream of new visitors from social media, which makes your Instagram and TikTok efforts look great. However, imagine knowing that your company only comes up in 10% of relevant discussions, whereas a competitor’s name gets dropped in nearly 50% of those conversations. Clearly, you have a greater potential audience on these sites and plenty of work to do if you want to overtake your competitor.

Companies may also purchase data from panels or internet service providers (ISPs). Companies like Comscore and Nielsen pay everyday internet users to install tracking tools on their home computers. They track the online habits of their user panels and use what they learn to predict how people behave on a population level. This data can be broken down by demographic to help companies learn more about who is in their audience. However, it’s limited by the size and composition of the panels; B2B companies, for instance, may struggle to glean insights as these companies mainly gather data from personal (not company) computers.

ISP data is wider but less precise than panel data. An ISP can see almost everything a user does online because it’s responsible for connecting internet users to the sites they want to visit. These records often include data from millions of people and tend to represent both work and home internet use. However, ISPs don’t offer demographic data. They anonymize their reports, so they are not useful for learning about a particular consumer segment. This data is best for getting a broad view of how many people interact with your site.

The importance of web analytics

Your company’s website is probably the first place your users end up on to learn more about your product. In fact, your website is also a product. That’s why the data you collect on your visitors can tell you a lot about them and their website and product expectations.

Here are a few things web analytics can help your company do:

Understand your website visitors

Web analytics tools reveal key details about your site visitors—including their average time spent on page and whether they’re a new or returning user—and which content draws in the most traffic. With this information, you’ll learn more about what parts of your website and product interest users and potential customers the most.

For instance, an analytics tool might show you that most of your visitors land on your German site. You could use this information to ensure that your product has a German version that’s well-translated to meet the needs of these users.

Analyze website conversions

Conversions could mean real purchases, signing up for your newsletter, or filling out a contact form on your website. Web analytics can give you information about the total number of these conversions, how much you earned from the conversions, the percentage of conversions (the number of conversions divided by the number of website sessions), and the abandonment rate. You can also see users’ conversion paths, showing how your users moved through your site before they converted.

This data can be your guide for a conversion rate optimization (CRO) initiative. CRO projects update website design, content, and architecture to achieve the optimum quantity and quality of conversions.

Web analytics tools can also show you important metrics that help you boost purchases on your site. Some tools offer enhanced ecommerce tracking capabilities to help you figure out, for example, which products are your top sellers. Once you know this, you can push new buyers toward your most popular products and boost your sales.

Boost your search engine optimization (SEO)

Connect your web analytics tool with Google Search Console to track which search queries are generating the most traffic for your site. With this data, you’ll know what topics to focus on as you try to boost your site’s rankings.

It’s also possible to set up on-site search tracking to know what users search for on your site. This search data can help you generate content ideas for your site, especially if you have a blog.

Understand top-performing content

Web analytics tools also help you learn what site content is performing the best so you can focus on the topics and formats your audience likes. You can also use this information to make product improvements.

For instance, you may notice blog articles that talk about design are the most popular on your website. This might signal that your users care about your product’s design features, leading you to invest more resources there. Popular content on your website could spark ideas for new product features, too.

Understand and focus on strong referral sources

Web analytics tell you who your top referral sources are, so you know which channels to focus on. If you’re getting 80% of your traffic from Instagram, your company’s marketers will know to invest in ads on that platform.

Web analytics also show you which outbound links people are clicking on. Your company’s marketing team might discover a mutually beneficial relationship with these sites or brands and reach out to them to explore partnership or cross-referral opportunities.

Measure the success of digital marketing campaigns with web analytics

Effective digital marketing campaigns respond to audience insights. Web analytics can help you track viewers’ responses to your marketing efforts and tailor them to fit the demographics of your target audience. You want to know what users are responding to and why.

Digital marketing campaigns rely on a bevy of analytics to learn these answers. The metrics you use will depend on the type of campaign you’re running and the channel you’re using to run it. Some of the most common digital marketing web metrics are:

• Clickthrough rate (CTR): How many ad views result in reader clicks.
• Conversion rate: The percentage of viewers who ultimately complete the desired action.
• Bounce rate: The percentage of people who, after clicking on your ad, leave your site after seeing only the landing page they were taken to.
• Engagement time/time on page: How long the average individual spends browsing the landing page your ad sent them to.

Beyond these simple metrics, digital marketing teams may track respondents’ journeys across their site. For ecommerce-focused campaigns, additional metrics like customer acquisition cost and average order value help show the ROI of a digital marketing campaign.

Getting Started: Eight metrics to track with web analytics

Website performance metrics vary from company to company based on their goals for their site. However, successful web analytics programs follow the same process:

• Set business goals: Define the key metrics that will determine the success of your business and website.
• Collect data: Gather information, statistics, and data on website visitors using analytics tools.
• Process data: Convert the raw data you’ve gathered into meaningful ratios, KPIs, and other information that tells a story.
• Report data: Display and share the processed data in an easy-to-read format.
• Develop an online strategy: Build a website experience that supports your business goals.
• Experiment: Run A/B tests to determine what your audience responds to, and continue working to improve your reader experience.

Web analytics tools can collect countless pieces of data, even from the simplest website. Here are some common KPIs businesses track to improve their online offerings.

1. Page visits and sessions

Page visits and sessions refer to the traffic to a webpage over a specific period of time. The more visits, the more your website is getting noticed. A page visit refers to a view of a single page. A session refers to a user’s entire visit—which may span multiple pages—from the time they load the first URL to the time they close out of your site.

Keep in mind traffic is a relative success metric. If you’re seeing 200 visits a month to a blog post, that might not seem like great traffic. But if those 200 visits represent high-intent views—views from prospects considering purchasing your product—that traffic could make the blog post much more valuable than a high-volume, low-intent piece.

2. Unique pageviews

Page visits, or pageviews, by default tally each time a webpage is loaded—a count of unique pageviews discounts visits that happened within the same session.

For instance, a visitor may land on a product page, click a link to your knowledge base, and then hit the back button to return to the product page. This would count as two page visits but one unique pageview. Individual users can skew the number of total page visits by continually re-visiting or reloading pages during one session. Knowing the number of unique pageviews helps you get a better idea of the size of your audience and evaluate page popularity.

3. Traffic source

Web analytics tools enable you to easily monitor your traffic sources and adjust your marketing strategy accordingly. For example, if you’re getting a lot of link clicks in emails, you might send out more email campaigns to boost traffic.

4. Conversion rate

Conversion rate refers to the percentage of people who complete a critically important action or goal on your website. A conversion could be a purchase, an email list signup, or something else entirely. You may even track the conversion rates of multiple events because there are likely many actions a reader can take that would signify deep engagement with your brand.

5. Bounce rate

Bounce rate refers to how many people visit just one page on your website and then leave your site.

Interpreting bounce rates is an art. A high bounce rate could be both negative and positive for your business. It’s a negative sign since it shows people are not interacting with other pages on your site, which might signal low engagement among your site visitors. On the other hand, if they spend quality time on a single page, it might indicate that users are getting all the information they need, which could be a positive sign. Smart teams look to understand the why behind a bounce rate by using other metrics like time on page to determine whether a page is a hit or a dud.

6. Repeat visit rate (or returning visitors)

Repeat visit rate tells you how many people are visiting your website regularly or repeatedly. This is your core audience since it consists of the website visitors you’ve managed to retain. Usually, a repeat visit rate of 30% means you’re doing well. Anything below 20% shows your website is not engaging enough.

7. Monthly unique visitors (or new visitors)

Monthly unique visitors refers to the number of visitors who visit your site for the first time each month.

This metric shows how effective your site is at regularly attracting new visitors, which is important for your growth. Ideally, a healthy website will show a steady flow of newcomers to the site.

8. Unique ecommerce metrics

Along with tracking these basic metrics, an ecommerce company’s team might also track additional KPIs to understand how to boost sales:

• Shopping cart abandonment rate shows how many people leave their shopping carts without making a purchase. Fewer abandoned carts mean more sales made.
• Other relevant ecommerce metrics include average order value and the average number of products per sale. Boosting these metrics helps increase sales.

Web analytics tools

There is a wide range of web analytics tools available, including tools that traditionally specialize in product, marketing, or experience analytics.

Amplitude's Digital Analytics Platform combines the best of all worlds. Our unified platform supports analytics across digital products and experiences—including your app or website. Pair quantitative data with qualitative insights using built-in Session Replay so you can better understand user behavior on your site.

Common issues with web analytics

While web analytics can be extremely useful for optimizing the website experience, there are some drawbacks to relying on data without using common sense. Some of these include:

Keeping track of too many metrics

More data doesn’t always translate to better outcomes. It can be overwhelming to combine web analytics, product analytics, customer experience tools, heatmaps, and other business intelligence analytics to make sense of things.

As a general rule, only measure the metrics that are important to your business goals and ignore the rest. For example, if your primary goal is to increase sales in a certain location, metrics from other locations won’t be useful.

Data is not always accurate

The data collected by analytics tools may not offer a complete picture of your audience. Many users block cookies or scripts, which prevents web analytics tools from collecting information on them. As we move towards a cookieless world, analytics solutions (like Amplitude) that deliver first-party data will be essential compared to those that rely on third-party data.

Your web analytics tool may also be using incorrect data filters, which may skew the information it collects, making the data inaccurate and unreliable. And there’s not much you can do with unreliable data.

Data privacy is at risk

Untracked or overly exposed data can cause privacy or security vulnerabilities. People share all sorts of personal information with websites, including credit card details and addresses. Audience behavior data is also considered sensitive under many countries’ laws.

As privacy laws have become more stringent over the last decade globally, cybersecurity has become a growing priority among analytics teams. Make sure your web analytics tools have proper monitoring procedures and security testing, and your team is properly trained regarding data security. Any breach to an analytics service provider that compromises user data can be devastating to your business’s reputation.

Data doesn’t tell the whole story

While web analytics are useful for learning how users interact with your website, they can’t do much to help you understand user behavior. Web analytics can tell you what users are doing but not why they do it. Understand the “why” with a behavioral analytics solution like Amplitude Analytics. By looking at behavioral product data, you’ll see which actions drive higher engagement, retention, and lifetime value.