I find a lot of confusion out there when it comes to conversations about analytics for websites and applications. Here's a brief primer for how to use the right terms in your discussion...
Metrics
A metric is a something that can be
measured based on quantifiable data,
or at the very least,
estimated based on anecdotal data.
An example of a metric could be your heart rate or blood pressure taken by your doctor at a specific visit.
Key Performance Indicators (KPIs)
A key performance indicator (KPI) is
a visual indicator that tells a story
about one or more measurements, in context.
An example of a KPI could be the trend of your heart rate or blood pressure over a certain period of time. If the trend is upward, an up arrow might be used with the percentage of increase over that time period. It might be colored red if the implication is negative.
Web Analytics
Web analytics is the
measurement, collection, analysis, and reporting
of web data for purposes of
understanding and optimizing web usage.
Web analytics tools such as Google Analytics mainly provide metrics for consumption via reports and APIs. What they usually don’t do is put them together in a nice PowerPoint deck to present to your boss!
Web analytics tools may already provide some KPIs in dashboards. These are more sexy and ripe for executive consumption. However, most practical KPIs are usually either:
- Formulated automatically via additional software that process the metrics via APIs
- Manually compiled by a site administrator
This is because most businesses want to answer very specific questions and monitor custom KPIs that aren’t readily available as an include with a tool.