Web Analytics in Europe 2010

I made a podcast about web analytics in Europe back in June 2007. I now figured it was about time to ask three experts about the progress made since then. After all, nearly three years have passed.

The experts whom I’ve interviewed this year:

Dennis, Steve & Aurélie

This time all interviews were carried out through the use of e-mail.

Do you think that the challenges businesses are facing have changed since 2007?

Steve: The speed of technological innovation has been and continues to be the biggest challenge in my view. Marketers were just getting their heads around email and search engine marketing. Now because of the way social platforms have matured for example digital marketers have to get ahead of another learning curve.

The paradigm has changed, businesses need to connect with consumers on their terms. Pushing offers no longer works the way it used to work. If a direct mail piece lands on your doormat or into your inbox while you may read it just like you did before you now have the ability in less time than it takes to make coffee to check out if your friends are recommending similar products/services from anywhere in the world. The speed of this change is what I see being the main challenge today, it’s taking a while for many marketers to catch up and learn about digital marketing in the 21st century.

Then comes the measurement promise related to digital. If you believe vendors it’s all 100% measurable. In theory it is but in practice it rarely works like that.

Dennis: There is little doubt in the circumstance that, any business that has a for them significant online presence, has become more data driven. And being data driven online today, will for the most part equal the use of a Web Analytics product or more broadly, a set of online business optimization technologies.

What used to be neat, nice to have and a bit adventurous back in 2007, from a data point of view, is now not only expected as ordinary online business practices, but more aggressively, a direct company disadvantage if not applied. There is not one serious online marketer who would dare to run an online campaign without a data output.

So have we changed? You are damn right! And the challenge that came with that transformation was the assignment to do, as a minimum, a proper web analytics deployment. From collecting data on- and off site, to report well defined key performance indicators to a large set of stakeholders and to continuously derive new insight from the data and be actionable on them. You must do this today and if you don’t, I believe the smarter folks in the organizations out there understand that a negative spiral is forming.

Aurélie: Today, there is no real discussion about the need for web analytics, or site centric measurement as the audience measurement guys like to call us, so that’s a big difference. As budgets are shifting, there is an increased need for accountability.

As budgets are shifting and more is being measured, it also means that companies are facing a multiplicity of data and risk getting locked into the accuracy debate, induced by a lack of trust in the differing numbers.

This reality is often addressed in our industry by a “get over it” attitude, which is totally defendable but does not fly within larger organization. One should therefore make sure that best practices are being used when it comes to measurement and quality control will have to become part of the processes. The numbers will certainly continue to differ, as it’s inherent to the technologies used, but at least measurement will be done in the best way possible. It sounds silly but this makes a world of difference when you stand in front of a boardroom and have to defend your work.

In terms of vendors, players more focusing on data integration such as Unica or SAS but also Teradata and MicroStrategy, are looking at owning a slice of the digital cake. We’ve seen an increase of APIs being available. The question is not anymore where the data should sit but how to give business users access to it in order to support their decisions and act upon the findings.

Enough has been said about the lack of action, despite multiple communications about successes due to optimization. Lack of action is inherent to an organization’s structure and will change once there is a clear and fundamental monetary need for it.

From a human resources perspective, ubiquity of information is pushing companies to rethink how they’re using data, and who gets access to what.

It used to be very limited as those DW projects where expensive and slow moving.

This is not the case anymore: data is becoming ubiquitous and access needs to be granted. Technology and data are playing larger parts in our daily lives, just look at Nike+ and how many people actually track their performance, comparing and sharing it with others!

This means that, even though employees are certainly less loyal to a company than some decades ago, they will, in some way, need to be granted access to a company’s data in order to perform better, and make data driven decisions. That allows companies to compete on this last frontier of our globalized world as data needs to be linked to a company’s overall strategy.

Will we see Chief Data Officers, next to Data Protection Officers, reporting to Chief Strategy Officers?

Will it be, as The Economist claimed some time ago, that companies will be looking to evolve their infrastructure to allow for “a CIO who guards stable information platforms & a CTO who cultivates data-handling talent in the open market”?

I don’t know. Bob Dylan just keeps singing in my head about change.

What’s the biggest difference in Europe now as compared to then?

Steve: I’d love to say that businesses have stopped focusing on eyeballs and are focusing on conversion but it still hasn’t happened. I’m still working on that!

Social platforms in 2007 were altogether much less mature than in 2010. We’ve also seen a recession in which many businesses were forced to assess what they were spending their money on.

A good thing in my opinion. You could also say that the 3rd screen (the mobile phone) is about to explode as a marketing medium. The biggest difference to me, however, is that now you have to market to the individual rather than the crowd. That is a huge challenge for many businesses and the ones that learn how to start compelling conversations with people will be the ones that are successful in the next three years.

I believe we have the tools to measure the level and type of conversations going on but it’s going to be equally challenging to measure social interaction as anything else. The bigger challenge is whether businesses make the cultural change required to shift their marketing strategies from marketing to many to that of marketing to one.

Aurélie: Of course the financial meltdown comes to mind in the first place but let’s be honest, it’s not as if this was totally unpredictable! It drives me totally crazy when I witness what’s been going on in Spain since I moved there, as the government just didn’t want to acknowledge it for a very, very long time!

So budgets have shrunk but this serves us well: they are moving to the digital space. When you look at countries such as the UK where digital ad spends have surpassed TV spends, at least for a quarter, you can clearly feel that we’ve moved beyond the Internet boom & bust fear of the beginning of this millennium and that the digital space can’t be ignored anymore.

The second evolution is the introduction of the iPhone, supported by stronger regulations from the EU when it comes to mobile access and the commitment of the EU to support economic growth through innovation and broadband access: “a Digital Single Market based on ultra fast internet. All Europeans should have access to high speed internet by 2013” (source).

Competitiveness in terms of productivity remains is a huge problem in the EU. I live in Spain..

Getting back to the iPhone, when you look at mobile penetration, compared to the Internet, it’s clearly going to be a huge catalyst as well for digital usage, not only in terms of basically browsing a website but also when it comes to specific applications that will change companies’ ways of doing business.

Look for example at Nationwide Insurance and how they’re using an application to change the way their claims department can now digitally handle requests. It’s a huge step forward. Disclosure: I used to work for Swiss Life so the costs related to inefficiencies in dealing with claims for insurance companies is a business issue I’ve been familiar with since the beginning of my career.

And this is just one example on how technology can induce change. We need creativity and understanding of internal processes in order to define how technology can serve companies more efficiently.

Looking more at the web analytics industry, both Google Analytics and Omniture have left their impact on the market, particularly in Europe. It’ll be interesting to see how Adobe’s acquisition of Omniture will impact the industry. Given that Omniture’s been present in Europe for some 5 years, it’ll also be interesting to see how their continuous relationship with existing clients will develop.

Getting back to free tools, thanks to Google, there has been a proliferation of technical support, pushing prices somewhat down in certain markets. With some 150 GAACs worldwide, it’s now a lot less difficult to get help when it comes to picking up and canning web analytics data. Other vendors have also done tremendous efforts to train people, either for free or for a fee, so that professionals with a couple of years experience can be found somewhat more easily.

Data integration between, for example, content management systems and web analytics tools have evolved quite positively compared to some years ago. Omniture’s Genesis effort goes into that direction. Vendors have also been integrating with other tools such as Voice of Customer (Foresee, OpinionLab, etc.), optimization tools (think A/B and MVT) or targeting tools, so this is a good evolution: integration is happening and more and more APIs are available as well.

While data integration remains one of the focal points, it has, however, been overshadowed by social media measurement where certainly integration plays a part. Think Radian 6 for example. Other types of tools like buzz monitoring, through solutions such as Attentio, are also starting to get some serious grip. These tools seem to talk to a broader audience.

How do you think the European use of web analytics compares to the other continents now?

Dennis: Europe has for the most part been in the forefront and most sayings about the US or North America being a year ahead are just coming from opinionated industry folks, not actual research or qualitative surveys concluding so. Am I biased? Perhaps, I am European, but I do live in the US though. However, beyond just providing yet another opinion, I would like to reference an actual study I did on the subject:

Web Analytics Industry—International Pulse (US vs. EU)

Web Analytics Level of Advancement in the UK, Benelux and Scandinavia

If you are too busy to click through, the conclusion is:

In contrary to what is commonly understood, European web analysts are on an average more advanced than US web analysts. This fact is based on two fundamental conclusions; namely that European Analysts are requesting and creating more Enterprise level reporting and analysis and working less with simpler reports.

Looking at the advanced report requests usage in the UK, Benelux and Scandinavia compared to a global average – we see two distinct conclusions. That the Benelux region is the most advanced web analytics region in Europe (of the three analyzed), but more excitingly, that the advancement of web analytics in the UK is not only below the global average, but also surprisingly below US levels!

Steve: I would say that there is an improved level of awareness meaning that the adoption of analytics has greatly increased. It’s certainly much easier now to consult around analytics because you don’t have to educate as much about the tools. Generally digital marketers have made use of the free tools such as Google Analytics or Yahoo! Web Analytics, even if it is to just see the effect of their campaigns on the numbers. So from that respect I think there is an improvement.

On the other hand analytics has hit the headlines in certain countries in Europe for the wrong reasons. German legal experts claim that Google Analytics is illegally passing information to US servers while in the UK protesters got the EU involved over the deep packet inspection technology Phorm which compromises privacy in a big way.

The issues are treated very seriously in Europe and the vendors have to be very careful about what they’re doing. We could see a backlash against the industry like I witnessed when I mistakenly thought Phorm was simply another behavioral marketing system. I changed my position after double checking and realized that the Phorm technology was built on very dodgy foundations.

Aurélie: Due to my unique position as partner of Web Analytics Demystified Inc., focusing more specifically on the European market, I’ve moved from comparing projects on a pan-European level to doing so between the U.S. & Europe.

Unfortunately, budgets for tools are still far behind on the European continent.

And as we all know you need people to actually do something with the tools, the 50/50 or 10/90 rules are more than often difficult to justify. Add to that the fact that human resources usage in Europe is still less competitive than in the U.S., due to our inherent society, and you’re stuck with an interesting conundrum in these difficult times.

Companies are reluctant to hire and when they do, salaries don’t reflect the scarcity of qualified web analysts that we face in our sector. It’s one of the main reasons why we decided to set-up the Analysis Exchange: we need to train people to use the tools effectively and go beyond the pure tagging and report monkey tasks!

However, there is light at the end of the tunnel as I’m seeing commoditization of web analytics technical support, also in Europe. Fortunately also, I’m seeing online responsibilities moving up the food chain in their respective companies and being promoted to CMO for example.

A new generation is coming up but for the time being, when companies do hire, we’re not talking about senior people, who can address CXO levels with their findings in order to induce change of strategy. It will come but it will take time and varies per sector. Globalization and the deregulation of certain markets are driving change.

Think about a CMO who wants to have a better view upon what’s going on within the digital space in Europe: there is still no single pan-European solution available for audience measurement!

The fragmentation of the continent continues to handicap Europe versus the U.S., on different levels. We need standards that can be applied at least all over Europe as well as communication between those active in the audience measurement field, driving traffic to the websites at the cost of multiple euros. Using different lingo at all levels is not helping. It’s not about who’s right or who’s wrong, it’s about doing something with the findings, using those recommendations.

So, is it improving? Yes. It this specific to Europe? I’m not sure.

However, it’s interesting to note that local vendors such as Nedstat (the Netherlands), AT Internet (France), Webtrekk (Germany), RedEye (the UK), Snoobi (Finland), and Gemius (Poland), to name just a few, seem to hold their ground. There are also interesting European products out there that are adjacent to web analytics.

It partially solves localized support, even though U.S. based vendors have done part of their homework, and allows for adaptation to local needs such as multiple currencies, translation, and privacy restrictions, to name just a few.

The podcast I made in 2007 about web analytics in Europe