5 steps for measuring marketing effectiveness using Google Analytics

The importance of attributing e-commerce sales

As online marketing has grown in importance the question of how to attribute the resulting sales has become more and more challenging. Many businesses don’t even track it, which can be a costly error. The aim of attribution is to solve the ‘I know half of my marketing spend is wasted but I don’t know which half’ problem.

How should I start attributing my marketing?

If you’re not looking at attribution then you’re over-counting your sales, and spending on marketing that isn’t really working for you. And until you start using attribution then you can’t fix that. So, where do you begin? Google Analytics offers a free package that is relatively simple to use, offering a good starting point for start-ups. Once installed, there are five easy steps that can be followed to help you understand your marketing performance: Step one: Make sure you’re tracking the conversions that happen on your website. This means either:

  • Registering the sales you take via a Google Analytics tracking code. This is the extra Analytics tracking code you need to put on the page after an order is placed. So to use it, you need to have a Google Analytics account, and then follow the instructions here:
  • Or the leads you get by setting up a Goal within Google Analytics.  See for instructions. You can set up a wide range of Goals in Google Analytics – what you should be interested in is using the Goals to show you when someone’s signed up, or bought something. To do this you need to set up the page you want the visitor to get to as a Goal (create multiple goals if there are multiple pages you’d like to record them getting to – e.g. email sign up confirmation, and order confirmation pages). You can then track how successful your conversion rate is.

Once all that’s set up you need to sit back and let the data roll in. Step two: While you’re waiting, identify each of the ways you are getting traffic to your website (email, social media, flyers etc.). Step three: Then work out how much each costs you every month (both the money and the time). Too many start-ups undervalue the use of their own time or haven’t considered applying a ‘cost’ to what takes up their day. Step four: Ensure you can recognise each source of traffic in your Google Analytics account (look at the traffic sources report). You will need to tag some of the links – with some systems this is easy (you can link your Google Adwords and Google Analytics accounts), with others you’ll need to create the links yourself – type “Google URL builder” into the search engine for the tool you need to do this. Step five: Now you can see in Google Analytics which traffic sources are driving your sales/leads. If you want to see how the marketing channels each help with the sales then take a look at Google’s Assisted Conversions & Top Conversion Paths reports – in Analytics go to Conversions / Multi-Channel Funnels. Here you can see how all the marketing activity works together to drive your sales.

Analysing your attribution model

Once you’ve put an attribution model in place it’s important to continually analyse that you are using the right system for your business. For instance, there are two basic attribution models: First click model. This allocates the sale to the first source that gets the customer to the website. So if a sale for £10 was referred by email and then Twitter, email would be rewarded with £10. Last click model. This allocates the sale to the most recently tracked visit to the site. So if a sale for £10 was referred by email and then Twitter, the micro-blogging site would be rewarded with £10. Google Analytics uses the ‘last click’ model. Both of these models can actually be a little unfair if you have customers who spend time researching their purchases, and if you’re using lots of marketing channels to get them to your website, however they provide simple and easy to-get-to-grips with tracking options to get you started. After using a free tool such as Google Analytics, if you find that your traffic sources are showing lots and lots of overlap then it may be worth investing in a more complex attribution tool, such as Omniture, TagMan, Coremetrics, Master TMS, etc. So start off with what you’ve already got and work out how bad the problem is for you. Bear in mind that more complex tracking options can be costly. The most important thing is to keep common sense in mind – if the software you find to manage your attribution is going to cost £1,000 per month, you need to weigh up if it is going to save or make you more money than that. Because if not, it’s not (yet) the right solution for you. By using some very basic attribution you can start to make sense of what’s working and what’s not when it comes to your marketing. Chloë Thomas is the author of eCommerce MasterPlan, and also runs online marketing agency indiumonline.


(will not be published)