The Google EffectThe Google Effect

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But Google Analytics has its limitations. It doesn't offer custom reports or make it easy to import data from other sources, such as customer data from call-center and point-of-sale systems, that businesses want to add to the analysis mix, Forrester Research analyst Bob Chatham says.

Web-site analysis tools from WebTrends and others can analyze data from dynamic URLs better, says Jason Palmer, WebTrends' VP of products. Dynamic Web sites change in response to visitor actions, such as hotel Web sites that offer lower rates for longer stays.

Google Analytics can be used to analyze advertising-generated Web traffic from Google competitors such as Yahoo and MSN. But, as Coremetrics' Davis asks, "Do you really want Google measuring how effective Yahoo and MSN [advertising] campaigns are?"

Service may be the biggest gap between Google and its established competitors. Most vendors, whether providing their technology on a hosted basis or as software, offer a broad range of technical support and data-analysis services. Coremetrics, for example, assigns clients a data analyst to help them understand the information generated by the vendor's hosted Web-analytics system and provides best-practice expertise for vertical industries such as retail.

"This is a professional-services-intensive industry," says Forrester's Chatham, who in a report describes Google's offering as "strictly targeted at the self-service implementation and maintenance market." The company is working with third-party companies to provide more sophisticated services, although he declined to name them, Google's Holden says.

"The kind of stuff we're doing, I can't see Google getting to," says Grant at Enlighten, which uses WebTrends to provide complex Web-analysis services for its clients. One way to ensure accurate analysis: Web-site visitors who go to a "landing page" and then immediately leave need to be filtered out from those who stay and do something on the site, she says.

One potential benefit of Google Analytics, assuming it's widely adopted, is that it could spur the creation of standard definitions for Web-analysis terms such as "visitor," "view," and "conversion," Grant says. Some tools define a Web surfer who visits a Web page, leaves, and comes back within an hour as a single visit while others label that two separate visits.

Traffic analysis
Enkeboll Designs, a manufacturer of architectural woodcarvings, uses Omniture to analyze traffic at its Web site and identify trends about the kinds of products customers view and buy, data that influences Enkeboll's product development, says Richard Enriquez, director of marketing and IT. "What I liked about the Omniture product was its real-time capabilities," he says. Web-site visitors also can download 2-D and 3-D digital images of Enkeboll products--something the company wants to track--and he isn't sure whether Google Analytics can handle the different file formats.

Despite the perceived shortcomings of Google Analytics, it likely will encroach on the market space occupied by vendors such as Fireclick, ClickTracks, and Engine Ready. Other vendors might debut free, low-end products to lure potential customers to their fee-based offerings, Forrester's Chatham says, and there also could be more competition and price-erosion at the top of the market. Coremetrics' typical customer pays about $10,000 per month, Davis says, while WebSideStory CEO Jeffrey Lunsford puts its average contract at $40,000 per year.

Another potential benefit: The fact that Google considers Web-site analysis important is sure to raise the visibility of Web analytics among top IT managers and even business executives.