Google Analytics

What is Google Analytics?

Google Analytics is free software from Google that you can use to measure and gain insight into virtually all activity to, on and from your website. The most commonly used function is to measure the number of visitors to a online business. 

Within Analytics you can specify your own periods about which you want information, you can see where visitors come from, what they searched for in Google, how long they were in your online business and what exactly they did there. 

The software is easy to install in almost every online business by adding a small script in the source code of the online business.

Using Analytics

Analytics is used to measure the performance of an online business and indirectly your marketing efforts. With Analytics you can see exactly how visitors enter your online business: From Google search results, through Google Ads (formerly Adwords), through links (and which ones) on other sites or, for example, a newsletter that is sent. When you put a lot of effort into the SEO of an online business, you can use Analytics to monitor whether this leads to better positions and more visitors. Then it is also possible to see what these visitors do in your online business, whether they buy something and what they subsequently buy.

With this information you can decide what the best action will be: Perhaps an effort in SEO pays off less and your investment in Google Ads pays off better. Or does traffic Price.com give you orders with a good margin? This also has to do with the 'click paths' people take on your online business: are they logical, are they too long, do too many people drop out, or...?  You can analyze and optimize it all thanks to Analytics.

Here I would like to add that we recommend all owners of an online business to link the Analytics account to your Google Ads account and your Google Search Console (formerly Google Webmaster Tools) account. This gives you access to all the complete visitor data in your own Analytics account. You link with both accounts via the admin function of Analytics. Then you also set up 'e-commerce tracking' here, so you can track for each conversion what was purchased and for what amount.

Why is Analytics important when buying/selling an online store?

Because Analytics gives you insight into how many visitors come in per channel, what they bring in and how this can be improved. For example: An online business has 500 visitors per day, of which 300 come in via paid channels and 200 via 'free channels'. The 300 visitors generate an average of 7 orders/day (7/300 = a conversion rate of 2.33%) and the 200 visitors generate 3 orders (3/200 = a conversion rate of 1.5%). However, visitors coming in through paid channels cost a certain amount per conversion and the visitors coming in through unpaid channels do not (at least not 1-to-1).

Based on this data, you can determine where to invest your time, energy and money. And as a buyer or seller of an online business: Where are the opportunities! 

When buying an online business, you can also use this information to determine the dependencies of each source of visitors. Suppose that 80% of the visitors are 'direct' traffic (i.e. that they go directly to your online business and do not enter through another channel such as Google) and that this traffic gives an excellent conversion, then the dependence on third parties is much less. Therefore, the value of the online business is higher than if 80% comes through, say, Price.com: Because if Price.com adjusts its rates or stops its platform, you lose 80% of your income.

Next, analyses of the click paths will reveal which path leads to the most conversions or to orders with the highest margin. With this information, you can set up the online business 'smarter': You make sure that visitors see what they are looking for right away and then checkout with as few steps as possible.

Giving access to your Google Analytics

It is common for sellers to give (potential) buyers access to the statistics in their Google Analytics account. Be aware that if you use the full e-commerce settings in Analytics, a buyer may identify your runners directly. It is conceivable that you may not share this information until late in the acquisition process, when there is more clarity.

The following is how you provide easy access:

1 - Log into your account and go to your online business (property)
2 - Click on administrator (at the bottom of the left menu)
3 - Go to "User management"
4 - Add the potential buyer's email address via the '+' sign in the upper right corner and select "read & analyze" as the level. 

Note that in order to add a user, they must have a Google account. A Gmail account always works. Business email addresses (@companyname.co.uk) linked to Gmail also work.

Analytics & Acquisitions

Of course, many other elements come into play. Analytics is a comprehensive package and the options are many. In this article, we only want to point out the importance for you: As an online business owner, or future online business owner, you cannot do without it: Analytics is an essential part of the valuation!

Are you curious how to transfer the Analytics account after an acquisition? Read our article about it.

If desired, you can hire us to perform a scan, with which we will completely go through the visitor flows of your (new) online business for current status and potential, from the source to the exit page. (If it concerns a potential purchase, the cooperation of the current owner of the online business is required).