From the August 1999 issue of Entrepreneur

Web-site statistics are no small matter to Diana and Gregg Shapiro, owners of All The Right Gifts Inc. (http://www.alltherightgifts.com) in Woodland Hills, California. The gift-selection company runs an online shopping directory to help customers find gifts quickly.

Without reliable site statistics, the couple wouldn't be able to track the site's 500 daily visitors, who peruse at affiliate sites (sites where All The Right Gifts gets a portion of any sales revenue generated from its referral) that sell gifts ranging from flowers and CDs to airline tickets. The data tells the couple which areas of the site visitors are viewing and which search engines were used to reach the site--essential elements for managing the online directory.

"The data helps us figure out which search engines are generating the best referrals and what keywords customers are keying in to find us," says Gregg. "Then we use this information to concentrate our marketing efforts in the best way possible."


Melissa Campanelli is a technology writer in Brooklyn, New York, who has covered technology for Mobile Computing & Communications and Sales & Marketing Management magazines. You can reach her at mcampanelli@earthlink.net..

Tracking Hits

There are myriad ways to keep track of users who visit your Web site. The easiest way is through a counter, which simply tallies the number of hits a Web site receives. This information is not very helpful because a hit is usually defined as a file access by the server, and unless special filters have been set up, this means any file access. "One person could access the home page 10 times and generate 10 hits, or 10 unique people could access the page and generate 10 hits," says Gary Valle, a computer consultant based in Canoga Park, California.

A better way to track and generate information about a site's visitors is with log analysis software. This type of software--typically available directly from manufacturers or as a value-added service offered by your ISP--generates graphical reports of user behavior and tells you which areas on your site visitors like, how they got there, how traffic affects server performance and even the site's return on investment.

The number of unique (or individual) visitors is determined by analyzing the number of unique IP addresses--a number that identifies a computer's connection to the site's server each time a user visits a site. Using log analysis software, it's also possible to determine total page views (the number of pages accessed by each visitor) and unique page views (the number of unique pages accessed by each visitor), as well as the number of times a visitor logged onto the site each week.

The Shapiros gather and manage data by logging on to a special Web site set up for them by their Web hosting company, Atlanta-based Interactive Media Corp. (IMC) Online. IMC Online (http://www.imconline.net) uses a log analysis program called Statistics Server 4.2, published by MediaHouse Software Inc. (http://www.mediahouse.com). This software allows the Shapiros to obtain real-time statistics about their visitors 24 hours a day as well as reports that can be e-mailed or viewed online. For $25 per month, the Shapiros receive their regular Web-hosting services and access to this useful site data.

Another good log analysis tool is WebTrends Log Analyzer, from WebTrends Corp. (http://www.webtrends.com). Like Statistics Server, this program allows you to analyze your site traffic in real time. You can obtain detailed graphical reports of user behavior, such as which areas on your site visitors like best, how they get to your site and how your company intranet is being used. When purchased directly, this software costs only $399 (street), but you'll need some technical expertise to understand this product fully.

The Shapiros use the visitor information to modify their site's focus. "One month, we noticed a lot of people were typing `automobile' and `airline tickets' into our search engine, so we changed the focus of some of our Top 10 gift suggestions to reflect this," says Diana. "We also changed our home page. It now includes information about automobiles, clothing and travel. Basically, we can change it to reflect what most of our customers are looking for."

Don't Just Sit There

All The Right Gifts is taking what is considered a passive approach to tracking its site's visitors. The passive method tracks users behind the scenes via IP-address-tracking mechanisms or through cookies, computer programs that automatically download to a user's Web browser to track his or her every move. An active approach, on the other hand, requires users to fill out forms with personal information.

Many small businesses are using sophisticated analysis tools that combine passive and active approaches. Instead of offering information based on IP addresses alone--nameless, faceless people--products on the market today can combine your database of customer information with tracking mechanisms and data mining software. Besides figuring out where specific visitors come from, where they go when they leave, where they browse and how long they stay in each section of a Web site, these products can also build personal profiles based on browsing and purchasing patterns and alert a company to unusual activities or sudden spikes in demand.

One company that offers a robust tool like this--and is receiving many requests from smaller companies--is net.Genesis Corp. (http://www.netgenesis.com). The company offers an online analytic and decision support application called net.Analysis 4.0., which correlates information about Web site behavior and other business data to improve strategic decision-making about marketing your products online.

Here's how net.Analysis works. Once you gather user IDs with a mechanism on your site--such as a form customers fill out with their names and e-mail addresses--the tool allows you to track these specific customers every time they return to your site. The main advantage of this program is that it tracks the actual visitor (for example, joe@xyz.net) rather than the user ID (the "cookie" generated by the user's browser, which could be shared by any number of people). It's possible to follow how long they stayed on the site and how many pages they viewed during each visit. Perhaps even more important, the information can be used to create a visitor database, whose information can be used to send targeted e-mail marketing campaigns to specific visitors.

The software and consulting services required for net.Analysis cost between $12,000 and $15,000. The company also offers a lower-cost consulting service for which net.Genesis analyzes a portion of the data determines who your best customers are. This analysis costs about $5,000.

You can get even more detailed information about users by adding personalization methods such as collaborative filtering. This allows you to gather material about visitors by tracking their preferences and combining them with those of similar users viewing the site. Then you can offer product or service recommendations and launch marketing campaigns targeted to specific users based on the findings. Net Perceptions (http://www.netperceptions.com) is one company that offers real-time personalization services, including slick collaborative filtering solutions. For example, users can rate content as they click, and the content they view on the Web site is adjusted after they rate the site.

This is a very high-end tool with a high price tag to match. But as small businesses start realizing the importance of taking steps to understand their Web visitors better, and manufacturers begin to target this vast market, prices will likely come down.

In general, despite privacy concerns, e-surveillance is being viewed as an essential weapon for any company doing business on the Internet today. In fact, some believe success and failure could be determined by the companies that best monitor the online activities of their customers and business partners.

Hot Disks

Toon it in: Try Andover.Net's GIFWorks, a new online tool that allows users to select, process and create animation online for free. Since all designing and coloring, shading and file importing is done on Andover.Net servers and with a familiar Windows-like interface, there's no complicated software installation, and new animation can be created in seconds. The application is available for Macintosh, Linux, Unix and PC platforms and only requires Internet access. Visit http://www.andover.net to find out more.

Add some spunk:NetStudio 2000 ($89) from NetStudio Corp. is designed to help novice users create a variety of elements for their Web sites, including buttons, button bars, banners, backgrounds and logos. At the heart of the program are its predesigned, easily customized templates and basic tools for image-editing to adjust brightness and contrast, and to sharpen and blur. The product requires 16MB RAM (32MB for Windows NT 4.0), 30MB hard drive space and Windows 95/98/NT 4.0. For more information, visit http://www.netstudio.com

All in one: Find all you need to get started in e-commerce--including catalog and order management features and secure credit card payment processing--from Actinic Software LLC's Catalog 3.0. Businesses can buy Catalog 3.0 to install and run on their Web servers, or they can look for an ISP or e-commerce host provider that offers it in storefront creation. The product, which costs $399, requires an ISP account and a Web site with user-written CGI capabilities, 16MB RAM, 30MB hard-drive space and Windows 95/98/NT 4.0. Visit http://www.actinic.com for more information.

Contact Sources

All The Right Gifts Inc., (818) 884-6462

netGenesis Corp., (617) 577-9800, http://www.netgen.com

Valley Programming Service Inc., (818) 992-5134, http://www.valpro.com

WebTrends Corp., (503) 294-7025, http://www.webtrends.com