If you're serious about using your Web site to attract business and serve existing customers, you need to go beyond the simple traffic counter. Web site analysis tools can track the myriad ways people use your Web site, while making sense of the mountain of data your site generates.

Using these tools, you can discover:

• How many users visit your site, how many return, and how often
• How users are navigating through your site
• Where in the "conversion funnel" or purchasing process they're getting stuck and leaving
• What content your visitors are looking for, and whether they're finding it
• Exactly which form fields are driving people away rather than bringing them in

Site analytics differs from Web site optimization, which is the process of making sure your site is user-friendly. For more on optimization, read What Is Search Engine Optimization? To understand how site analytics can improve your business, read on.

How Web Site Analysis Works

Web site traffic analysis software tracks how visitors use your site using one of two techniques: by analyzing traffic logs after the fact, or by tracking requests on the fly as they come in.

Traffic log analysis is the oldest technique. You install the software, and it cranks through the raw traffic data collected by your server. It organizes data already being collected, so you can view it as bar charts or graphs or tables, etc. This basic data includes:

• Number of page requests, by date or time
• Requests by browser type
• Requests by operating system
• Referring URLs
• Originating countries
• Status codes (Successful, Page Not Found, etc.)

You'll find scores of simple log analyzers, both free and low-cost. In fact, if you've outsourced your Web hosting, chances are that your service provider includes a log analyzer with your account as a value-added service.

The more sophisticated technique involves observing the traffic as it comes in. You need to add a bit of code to your page, which could be simple or complex, depending on how your site is organized and how the analytics software works.

Hosted vs. Installed

When looking for an analytics solution, the other thing to consider is whether to use a hosted service, sometimes known as software-as-a-service or SAAS, or to license the software and install it on your own servers.

Hosted services generate and maintain your log files off-site and charge based on a tiered subscription rate. The biggest companies in the field can also be the most expensive, but they usually offer competitive packages specifically targeted to the SMB. The advantage of a hosted service is that somebody else is doing the work and incurring the expense of maintaining your ever-growing log files. The disadvantage is that you can't necessarily run your own analytics on the log files because you don't control them.

Installed software gets installed on your own Web server, on client machines, or on a dedicated system at your site, depending on the software. It offers the advantage of greater control over custom reporting and archived data, but requires greater internal support costs.

To make sure your site works as hard as you do, read more about the advanced features available in software analytics products, as well as the industry's marketing/lead-generation sites, customer support sites, and and content or informational sites.