The web is inherently different. Everything is measurable. I know what you are thinking, “Yah, yah … I’ve seen those big reports that get emailed to me every quarter from my web development company that basically show big numbers in an effort to cut them bigger checks.” I understand and appreciate that mentality. Why? Because you are busy selling cars, shoes, clothes, fishing trips, lodging, real estate properties, stuffed animals, bicycles, engineering services, construction services, IT services, software, tutoring services, dog food, etc… You are too busy doing what you do best and it’s easier to do what you do with other advertising and marketing channels – just put a budget aside every year, pay someone to manage it and hope for the best. After all, you don’t have time to understand the difference between hits, visits, page views, keywords, referrer, and all that stuff.

Trust me, you can understand this stuff and as a business owner you need to understand this stuff. Do you need to understand it to the degree that I do? Maybe, maybe not. That’s up to you. But, just like your bank accounts, credit lines or retirement investments – you need to and can easily understand the fundamental measurements. Imagine not knowing your current interest rates on lines of credit, how many employees you have, the current status of your 401k, or how this years sales numbers compared to last years. You can’t imagine that, because you need to and want to understand those things – at least to the degree that you can make wise, well informed, and business critical decisions. Do you have to understand the infinite complexities of the stock market and understand the stock market to the degree that your financial advisor does? No. That is why you pay him/her. Do you want to and need to know how much you are investing, where you are investing it, and your return on investments. Absolutely.

So, let me show you a very base level and simple measurement that you can and need to understand. The goal of this demonstration is to make you say to yourself, “I get it. I wonder what my website ‘pie’ looks like?” If this blog gives you the inertia to want to find the answer to that question and the answer to that question becomes the incentive for you to want to better understand how to value your web assets, then the goal has been achieved. So, ready for how simple this pie chart is to understand? Here it goes:

There are only 3 possible ways people can get to your website. Yup, that’s it.

1. Search Engines: Traffic that comes to your website as a result of a search engine user typing your brand name or key words or phrases that relate to your business products and services into a search engine. This pie chart clearly shows that search engines are the most valuable traffic driver to the xyz.com website. 60.86% (10,616 visits) of the total traffic (17,443 visits) within a 1 month time frame comes to xyz.com from search engines. The name of the actual website has been excluded for anonymity purposes.

2. Direct Traffic: Traffic that comes to your website as a result of users typing your domain name directly into their web browser. This pie chart clearly shows that direct traffic is the second most valuable traffic driver to the xyz.com website. 22.23% (3,877 visits) of the total traffic (17,443 visits) within a 1 month time frame comes to xyz.com from direct traffic. The name of the actual website has been excluded for anonymity purposes.

3. Referring Sites: Traffic that comes to your website via a link from any other website. This is traffic that comes to xyz.com from blogs, forums, or websites where advertising dollars are spent to promote xyz.com.  It is important to note that it is very easy to measure the exact amount of visits that each referrer sent to xyz.com. This pie chart clearly shows that referral traffic is the third most valuable traffic driver to the xyz.com website. 16.91% (2,950 visits) of the total traffic (17,443 visits) within a 1 month time frame comes to xyz.com from referral traffic. The name of the actual website has been excluded for anonymity purposes.

“Measuring everything” is nothing new to global enterprises and Fortune 500 Companies, they have been tracking referral data, competitor data, conversion data and all sorts of complex customer/visitor scenerios since the dawn of internet days.  I learned the power of data, usability and measurement when working as a Digital Product analyst for my cousin Anthony Bradley at META Group (now Gartner Group.)

I was on the phone last night with another cousin of mine, Brendan Kelly, who is the business development manager for Hitwise. We were doing what we always do and passionately discussing the amazing advances in competitor tracking technologies and the competitive advantage that results from intelligently and strategically using measurement and stastics wisely. Then, like most conversations these days with clients, co-workers and industry peers, the conversation moved to the topic of the economy. And, for the most part, all of my best clients, friends and peers are saying the same thing,  ”We are focusing on providing ultimate value to our customers, doing whatever it takes and re-positioning our products and services to help our customers weather this economic storm.”

As an entrepreneur and small business owner myself I can completely relate to the spirit of this strategy, as it is exactly what I must do to keep The Simple Solutions ship afloat and my amazingly talented and loyal staff employed. Infact, I had been talking with a valuable client and passionate and entrepreneuer, Scott Farber, about implementing this very same strategic vision.

So, how does this relate to “Measurement and The Value 0?” Here is how. For the last several years, sales and conversions were at record levels. My small-mid size customers were buying and leveraging all sorts of software to measure their successes and stay one step ahead of their competition. Everyone was and still is swimming in a sea of infinate data. When times were good and sales were up and conversions were high, it made sense to only focus on the top perfoming statistics. Why focus any effort at all on things that are not converting or selling when we could be spending time focusing all of our efforts on the things that sell the most and convert the most?

Made sense then, still makes sense now to some degree … but there is a very meaningful statistic that is analageous to the 100 pound gorilla in the room. What about all of the search terms, and products and marketing initiatives that failed? What about all of those visists that came from XYZ search terms but didn’t convert? We know those 10’s of thousands or 100’s of thousands or even 10’s of millions of visitors came to your domain via XYZ search term and 100’s of thousands of others, why didn’t they convert? Did they not like your products? Did they not like your brand? Were and are you still targeting terms and traffic that didn’t really align with your products and services? Why was that 1 product such a dud and what could be done to bring that conversion rate from “0″ to 2% or 3% or 9%?

Now that “everything” is having a harder time converting it makes sense to look at the big traffic generators of the past and present that you ignored for so many years and continue to ignore. Perhaps, its time to measure and realize “The Value Of “0.” Now, I have to go finish reading an article that my other cousin, Ryan Kelly (Brendan’s brother), recommended as a good read.