Importance of Understanding the Differences Between Analytics, Analysis and Reporting
This might sound a cliche subject but unfortunately it is still a big problem that is not getting any better. We need to know where we are at with our relationship to data which includes analytics, analysis and reporting to make sure that we are on the right track. But in order to know where you are exactly, you need a true map. If you think you are doing analytics while you are actually in the reporting phase, you might assume that you are already at the end of the tunnel and there are no other opportunities for you to look at it. This article aims to be a map for you so that you can get the best out of the data you have.
Digital era opened us new possibilities to understand how our customers, fans, subscribers and stakeholders engage with us. For instance, it was impossible to know number of views or unique viewers for a specific article before digital era. Now if you work for an online newspaper or content site, you know which content is consumed the most with many other information. This is the most basic information we can get with web analytics tools like Google Analytics.
Since Google Analytics has been free from the beginning, all digital businesses start to watch their site performances with just single code. This possibility made everybody to start using web analytics tools but along the way terms were mixed and misused.
Google Analytics provides you the basic reports for you to understand some key numbers for your digital assets.
According to the Google this is what its analytics tool does: “Get the data you need to make intelligent marketing and business decisions”
Exactly! Get the data. That’s called reporting.
According to the one English dictionary “report is a spoken or written account of something that one has observed, heard, done, or investigated”. There is really not much thinking or analyzing here, you just click around the tool you are using, you find the source of data and pass what was observed without an opinion, comment or assumption.
I met people or consultants who called themselves “analytics consultant” because they can pull data from Google or Adobe Analytics.
Let’s see differences with some examples:
You are doing reporting when you have following presentation:
Website orders increased 20% Y/Y in July 2016.
Last 7 days we have had 15,000 visits from Google Analytics
Our most viewed page today is the homepage
Our signature red fall dresses were viewed 20,000 times this month.
Yesterday 155 people downloaded our IOS app
You see there is really no assumption or comment here. These are the simple facts. Reporting creates a base for analysis or analytics. There is no decision making in the reporting phase.
When we reach to the analysis stage we will be doing a detailed examination of the data we have. We can try to reach to some conclusion or we can try to prove hypotheses we have or we can try to understand the data. On the other hand analytics is a multi-disciplinary field where it works with different fields like statistics, mathematics and computer science.
Analysis usually is interested in current data while analytics use past data to predict future data. Analysis is not always about action but analytics is always about the action. Analysis might give a base to analytics and analytics can make decision by using its own scientific tools. Analysis can be done by a person, but analytics usually needs different kind of technologies, methods and models which can only be performed by a machine.
You are doing analysis if you have following presentation:
One of the possible reasons for the July 2016 sales increase is the new TV campaign.
Out of the new orders, 50% can be credited to Google AdWords, 10% to retargeting and rest can be attributed to direct and natural search.
Above presentations makes some comments on the reports that were given to us. Analysis is really trying to find a meaning in data. When our orders increase, we try to understand the reason of the increase but in many times we are never sure 100%. Was it the design change? Was it the new ads? Was it the reflection of the economical healing? Was it something about our competition? So in many cases we don’t know 100% but we might have some strong conclusions.
If we are talking about analytics we take what we saw in reporting and analysis and act upon it. If we prove or disprove some of the hypotheses we created in the analysis phase, we can use these facts to apply at other cases.
For instance: Is there a really scientific relationship who viewed X brand dresses and Y brand shoes? We can do statistics and optimization tests. Based on these tests we can start or optimize our recommendation engine. We start to look for relationships and meanings statistically and we can use the results everywhere that matters: When we target an ad, when we personalize the site or when we email some offers.
Having lost the where you are in the data related jobs is very normal. Because analytics have never been such a popular term or field. IT has been always used by scientists but now every marketers also needs to deal with data. Using a map and knowing where you are will help you to avoid many confusions. Each of the steps are very important and not everybody is suitable for each of them. Reporting might sound boring for some but it is crucial and some people who likes organization might like it a lot. Analysis is for curious minds who likes philosophy and who also likes to relate qualitative data with quantitative data. Analysis is somewhere in between reporting and analytics and it always does not have to be done with numbers, It might also include inspiration or “gut feeling”. So this field is better for those who don’t want to deal with technical stuff but who is creative enough to develop different hypotheses. And finally analytics are for those folks who likes to solve problems scientifically and technically.