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FutureNow Article
Tuesday, Mar. 11, 2008

Executives Run Out of Reasons to Fear Google Analytics

By Robert Gorell
March 11th, 2008

For some executives, it sounds crazy: Why should they entrust their business’s metrics to a free tool powered by the search engine that runs most of their pay-per-click ads?

To many others, though, the idea makes both dollars and sense. In fact, 60% of Fortune 100 businesses now use Google Analytics. And after recent updates to both product and privacy, even the skeptical minority are running out of reasons to fear it.

Here’s why…

Last week, Google Analytics released an industry benchmarking feature that allows you to weigh your site’s performance metrics against those of your industry at large. It looks like this:

This is a wonderful addition to the GA toolkit, so long as marketers don’t use it as an excuse to be lazy. (If your industry’s average conversion rate is 1.6% and your website converts at 2.3%, that doesn’t mean it’s time for Dom Pérignon. If you have a 70% bounce rate, knowing that the industry average is 72% won’t exactly calm your CFO’s nerves.) Still, it is nice to know.

Now, about those privacy concerns…

Although the Google Analytics team understated this in their announcement of the industry benchmarking feature, they also rolled out new privacy control settings, pictured here:

The incentive to (anonymously) share your data with the Google Analytics community it that it will help to make the industry benchmarking data more accurate and therefore more valuable. But what’s good to know here is that it’s “opt-in” — you don’t have to participate.

Perhaps this overt demonstration of privacy control will help to persuade executives who haven’t yet been willing to invest in web analytics to finally do so. Besides, it’s not like they used to give away your data unless you opted out. It’s just comforting to have the “Do not share” option.

According to the “benefits” page on the Google Analytics website,

Google takes the trust people place in us very seriously, and is pledged to safeguard the privacy of your corporate data. We understand that web analytics data is sensitive information, so we accord it the ironclad protection it deserves.

Don’t get me wrong. The hesitations on behalf of executives to adopt Google Analytics has been at least partially understandable. Having “don’t be evil” as their corporate mantra hasn’t exactly kept Google from being accused of rigging their own game. But…

Wouldn’t sacrificing your data be Googlecide?

During a panel discussion at SES London, Future Now’s Bryan Eisenberg discussed these issues with — among others — Brian Clifton of Google Analytics and Ian Thomas of Microsoft, whose forthcoming “Gatineau” analytics program is sure to encounter similar resistance.

In a post aptly titled “Trust me, I work for Microsoft,” Ian explains the awkward market conditions at play for these two supposedly gentle giants:

. . . Can we be trusted not to misuse the data entrusted to us for nefarious ends?

[Google's Brian Clifton] was a little coy about this, insisting that for Google to misuse the data it gets from Google Analytics (for example, to manipulate bid pricing) would be tantamount to fraud, and so of course would be out of the question. I believe him, and believe the same of Microsoft too – it would be suicidal (not to mention morally reprehensible and howlingly naive) of Microsoft to take anything other than the greatest care with the data we collect from [Microsoft analytics tool] Gatineau. But – and let’s not beat about the bush here – this data is of value to us, and the benefit we get from it subsidizes the development of free tools like GA and Gatineau. And we need to be open and honest about that.

Where Brian and I differed on the panel was that I can all too easily believe that the general public will not be totally reassured by any insistence we make that we will look after their data and only use it responsibly. Maybe this is because I work for a company that – how can I put it? – doesn’t enjoy the highest levels of trust in the industry. For me, building trust in our stewardship of data is something that we have had to do day by day, brick by brick, but more importantly something that we will always need to continue to do – a garden that we will always need to tend, if you like.

It’s certainly not enough simply to stay inside the law and expect to maintain user trust simply because nothing bad (like a data leak) has happened on our watch. Even if we feel we are doing everything right, if we stop trying to build trust, it will wither away.

I know what you’re thinking. “Did he just suggest that nothing they ever say or do will convince the market that Google and Microsoft have good intentions with our data?”

Well, to tell you the truth, in all this excitement I kind of lost track myself. But being as this is Google, the most powerful company on the Web, and they could use your data against you in some nefarious, suicidal and illegal way, you’ve got to ask yourself a question: “Do I feel lucky?”

I’m feeling lucky. Are you?

. .

Want to outperform industry benchmarks? We can help.

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Comments (12)

  1. If the benefits of this free product outweigh the bad, we suppose it is worth it? Providing they add more valuable features onto it without compromising too much of our “info sharing”, there’s little reason why not to use it.

  2. I think Ian is right, as evidenced by Michael Gray’s point of view. I fall into the “trust, but verify” camp, so I don’t have warm and fuzzies about this, either. But Brick Marketing is essentially right. There’s no such thing as a free lunch. The costs of Google Analytics right now are far below its benefits. As long as that continues, it’s hard to argue against. But – and this is a big “BUT” – any funny business and people will not only run like hell from it, but will likely call for greater oversight from government, too. So, Google – and, especially, MS, given their history – have lots to lose here, too.

  3. Tim,

    I agree with Ian, too. (Not sure if that was clear from the way I framed the post.)

    Thanks for sharing the Michael Gray link. Yeah, I’d say that pretty much proves Ian’s point ;)

  4. You have to admit, it’d be pretty easy for Google to compare their list of Analytics users against the logins for PPC campaigns, and any idiot could look at the data (particularly ROI and cost per converions) and determine if a PPC advertiser has room in their budget for “a little higher pay per click costs” that would improve Google’s bottom line at the expense of the advertiser, even without revealing Analytics data to anyone outside of Google.

  5. CJ,

    Sure. But would they? Wouldn’t the SEO community out Google immediately if there were any real evidence of something like that?

    All I’m saying is that, if that were to happen, someone would figure it out soon, and it would be the end of people trusting Google. Especially now that they have DoubleClick and everyone’s watching — especially Microsoft (not that it’s much comfort to the market, as Ian’s already noted).

    Google has an understandable interest in creating a great analytics tool, simply because it integrates so well with AdWords. Until proven otherwise, they’re just leveraging a free tool to make money off you later through text ads.

    Besides, Google doesn’t need to rig its own system. Pay-Per-Click costs are rising plenty on their own, don’t you think?

  6. Nice analysis dude. I like your approach

  7. “…Besides, Google doesn’t need to rig its own system. Pay-Per-Click costs are rising plenty on their own, don’t you think?…”

    Where does this trust in a “We are rich enough” insight stem from? Hasn’t history proved times and times that stock owners are never satisfied, no matter how high the margins may be?

  8. [...] Executives Run Out of Reasons to Fear Google Analytics - In fact, 60% of Fortune 100 businesses now use Google Analytics. And after recent updates to both product and privacy, even the skeptical minority are running out of reasons to fear it. [...]

  9. Robert,

    I see why you would read it that way. Perhaps I wasn’t clear.

    I didn’t mean to suggest that they would be content with their margins. I don’t think any business should be content with its margins. What I meant to suggest is that those margins are increasing on their own, thanks to market forces, and Google needn’t do anything illegal or immoral to stimulate that trend.

    Online ad spending is projected to go up about 24% this year. That means Pay-Per-Click costs are bound to rise even more due to supply and demand.

    It’s fashionable to talk about Google as though they’re Big Brother, but at the end of the day, people need to decide for themselves whether this company honors its own privacy policy.

    When they were an emerging company, it was easier for them to get by with essentially saying, “Trust us. We’re Google.” But now they’re in the same predicament that Microsoft is in. People won’t trust them automatically, even when they have no reason to distrust them.

    So be it. I’d just like to see some evidence of foul play from the people who make a habit of accusing Google of whatever their supposed scheme du jour may be.

    This is a tool that’s helped countless people to understand and grow their businesses more effectively. They’ve recognized the brand value in building and maintaining many similar free services over the past several years. The same can’t be said as easily for Microsoft, which surely doesn’t make Ian’s job any easier (i.e., “Trust me, I work for Microsoft”). Well, now it seems the market trusts one of these brands slightly more than the other — but just.

    A lot of people reading this may think I’m being naive, but I’ve yet to see any evidence of Google Analytics being anything other than a fine example of company with ample resources recognizing The ROI of Free.

    I wonder… would people trust Google Analytics more if they had to pay for it?

    (Thank you for challenging me to clarify!)

  10. I still have trouble with this focus on “industry.” Does GA give us the power to opt certain competitors in or out of this industry definition? In our business, sometimes our clients are our biggest competitors in other areas — and of course the lines are blurred. Has anyone else found a way to really make industry benchmarks a valuable metric?

  11. If google comes out with a statement that says, “Google Analytics data has no influence on organic SERPS and no influence on Adwords prices” I think a lot of people would be put at ease.

  12. Thanks for sharing this new feature in analytics. I was not aware of this. I hope this will help us to improve website.

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