Hack38.Identify Your Business Objectives

Hack 38. Identify Your Business Objectives

To provide real business value, you must first know what to measure and why.

Fundamental to web site measurement is the question "Why do you even have a web site?" Defining your business objectives, literally, your site's raison d'etre, is tremendously important to identifying changes you should make now and which changes you should leave for later. There's nothing complicated about defining your business objectives. Usually, when you start to ask about your company's business objectives, everybody seems to understand exactly what they are. Still, if you're not sure, read the rest of this hack.

3.3.1. Every Site Has Business Objectives

No matter how few pages or meager your goals. If you've taken the time to write some HTML and FTP it up to a server, you've certainly done so with agoal in mind. Even the countless millions who built unattractive and poorly linked GeoCities pages had a goal in mind: for others to see their site. If you have an eBay store, a weblog, any site at all, you will undoubtedly be able to identify some type of objective.

Your business objectives are always the most basic things. If you're an online retailer your business objectives are to sell more products and support current customers. If you are growing a business selling software or services, your business objectives are to create interest and generate qualified leads. As you can see, brevity rules the day when you're defining your business objectives, helping you craft an elevator speech (a pitch concise enough to fit in the 30 seconds or so of an elevator ride). A handful of business models and their most common objectives are listed in Table 3-1.

Table 3-1. Example business objectives for common business models online

Business model	Business objectives	Sample companies
Retail	Sell products	Amazon
	Sell high-margin products	WalMart
	Support existing customers	Sears
	Increase revenues	O'Reilly
Non-packaged goods sales (e.g., services, software, durable goods)	Create product awareness	Toyota
	Generate leads	Bank of America
	Generate qualified leads	Mercedes Benz
	Sell products and services	Comcast
Customer support	Decrease phone support costs	Novel
	Increase self-service	Microsoft
	Deliver support content	PalmOne
Advertising/content	Increase advertising revenue	CBSNews
	Increase visitor loyalty	CNN.com
	Increase brand awareness	Google

3.3.2. Translate Business Objectives into Measurable Activities

As you can see, business objectives are very high-level, 100,000 feet and above. So how can something so theoretical have any real value to web measurement? Simple. Each business objective is tied to reality by a handful of activities that can be measured via clickstream analysis.

Let's take a closer look at perhaps the Internet's most popular business objective: sell products. How do you sell products online? Visitors click to your web site and find a product they want, they add the product to a shopping cart, and complete their transaction by checking out. Each of these individual activities (arrive, find, add, and complete) is relatively distinct andcan be measured by even the most common measurement tools. Breaking the rather abstract "sell products" business objective into its constituent parts reveals what should be measured, as illustrated in Table 3-2.

Table 3-2. A handful of activities that define the "sell products" business model and associated metrics

Activity	Metrics used to measure activity
Visitors arrive at your site	Campaign responses
	Referring URLs
	Search terms
	Entry pages
Find products	Path analysis and fallout reporting
	Product and category page views
	Internal search terms
Add products to cart	Cart start rate
	Product add and removal rate
Complete checkout	Checkout start rate
	Checkout completion rate
	Order conversion rate
	Buyer conversion rate

Don't worry if the measurements in Table 3-2 are foreign to you, they'll be discussed the hacks throughout the rest of this book.

Once you've defined your business objectives and activities, you will know which reports to generate, which metrics to drill down into, which key performance indicators [Hack #94] to define and share, and even which hacks to read. It all starts with doing a good job of defining your business objectives.