How to Benchmark in Analytics

We have a lot of changes going on at SEOmoz (feel free to get excited, we sure are!) and with all of these changes to the site comes the need to focus on tracking. Internally we have spent the last few months redirecting our attention to not only the best practices regarding analytics and data mining, but really pushing ourselves to revisit our analytical processes.

You know what we realized? There sure is a lot of data. While I have always appreciated the reporting features in GA, I find that too often people take the reports at face value and fail to go deeper. It’s unfortunate since it is in those deep dives that you usually discover the data that can change your current course of action. So this post is going to tackle an approach to analytics that is often overlooked and (thanks to Google and their silly naming convention decisions) is rarely used to its fullest capacity. Get excited folks we are going to talk about benchmarking {Woohoo! Insert audience applause here}.

All of you excel spreadsheet lovers out there know plenty of ways to extract data and pinpoint specific red flags or recent successes. In fact, most people use analytics to simply analyze the current state of their account. While this is certainly a priority, it really is one dimensional. Instead of stopping there, why not go further? Why not better understand where your data was, and how you are measuring up? In fact, why not use this data to help inform your internal decisions as a company? It’s like an analytical epiphany—“using past and current data to help guide you moving forward.” Glorious.

While many of the analytics platforms out there have given us a number of ways to compare historical data to current data, we are still limited to two distinct time ranges (for the most part). It’s great to see those two ranges stack up against each other, but that still leaves a lot to be desired. Without going further you miss the "interaction" between those two distinct time ranges.

Benchmarking your data is a great way to discover more about this, often overlooked, gray area. Benchmarking simply means you set a standard at which you compare something else to. When used for data mining, it means you plot two distinct variables (time ranges, metrics, dimensions, etc.) over a period of time and then use these “benchmarks” to infer conclusions when making decisions.

You can then see a more complete picture of your site’s momentum. In my opinion, understanding your site’s momentum is one of the most powerful metrics an analyst can calculate. If you can say with authority that you know how your site is doing and how it will likely be doing in the next week, month, few months, etc., you are in an ideal place. With data like that you can take more calculated risks.

Source - http://www.seomoz.org/blog/how-to-benchmark-in-analytics