In the recent years, competition between organizations operating in the same field has drastically surged. This can be attributed to the reduced entry barriers, improved technological levels, high levels of investment in the field of research and development among other notable factors. In result, managers, directors and other stakeholders involved in the management of these organizations have been forced to employ contemporary forms of leadership in order to attract and retain qualified workforce, thus remain profitable both in the short and in the long run. Plaza (2009, p. #) indicates that the emergence of new technologies, such as internet marketing among other notable Web 2.0 applications, is the necessity for contemporary forms of management. He further urges that, since the onset of the global financial crises in 2008, at least 30% of well-established businesses have been forced to close down, due to the significant failure of their managers to employ modern forms of management. Based on the above reasoning, it is enormously crucial for managers in these organizations to note that the world of managing processes and people has dramatically changed.
In most instances, managers are now faced with numerous conflicting challenges of motivating and understanding an increasingly diverse workforce, planning for the future in this changing environment, being accountable to broad variety of stakeholders, as well as reflecting on the ethical implications of all decisions made in an organization. As a result of globalization, mainly brought about by improved technology, most organizations, regardless of their capital base, have attracted customers from all around the world. This is made possible by the online selling activities and customer interactions through blogs and social networks, such as Twitter, Facebook, and MySpace among other notable websites. This is a clear indication that there is an urgent need for organizations to have a competent management team that will be able to deal with customers from various cultures, as well as monitor their online activities. This way, sales turnover will increase, which will lead to higher profitability levels. This paper will critically evaluate the impact of web analytics on electronic commerce from the perspective of management, technology, and organization.
Plaza (2009, p. #) indicates that web analytics is the measurement, analysis, collection as well as reporting of all internet data, with an aim of optimizing and understanding the web usage. The web analytic tools employed are essential in tracking web traffic patterns, especially where visitors are coming from, the type of web browsing technology being used, and on the way visitors are interacting with the given website. However, it is crucial to note that besides being used for measuring web traffic, web analytics are also essential tools for conducting business and market research, as well as improving and determining the effectiveness of a given website.
For instance, most of the global companies, such as Apple Inc., Google Inc., Coca-Cola Company, and Toyota Company among other notable firms, have recently employed web analytics to approximate how changes the traffic to their websites immediately after introducing a new advertisement campaign. Generally, web analytics offers information on the number of visitors to a given website, as well as the total number of pages viewed. Plaza (2009, p. #) indicates that there are two notable types of web analytics, namely on-site and off-site web analytics. On-site web analytics measures the visitors’ journey once they click on a given website. It comprises of conversions and drivers, such as the landing page, a factor that highly encourages customers to make a purchase. Plaza (2009, p. #) indicates that on-site web analytics helps a company to measure the performance of its website in the commercial context. This is due to the fact that the data collected is compared to other notable key indicators, such as sales turnover, thus serving as a useful tool in improving marketing campaigns.
On the other hand, off-site web analytics refers to the web analysis and measurement, regardless of whether a firm maintains any credible website. This entails the measurement of website’s opportunity (potent audience), visibility (share of voice), and comments (buzz), which happen on the entire internet. Plaza (2009, p. #) argues that 88% of web analytics refers to on-site visitors measurement, although this have been blurred due to the fact that most vendors are currently producing tools, which enormously spans these two categories.
The Impact of Web Analytics On Management
As indicated above, the need to employ contemporary forms of management in an organization cannot be underrated. Contemporary management gives a fresh, as well as an integrative view of the roles, which have to be played by managers in line with the ever changing marketing environment. It is notable that contemporary management views managers as the ones who work with people within an organization and takes a careful note of modern issues like cultural changes, diversity, and global management among other notable factors. It is only through the contemporary means of management that managers and other stakeholders can be able to enhance customer’s satisfaction, especially to those visiting their websites.
According to Lenskold (2003, p. #), management is designing, as well as maintaining a healthy environment, through which people working together as a group can effectively accomplish the desired goals. For instance, managers are engaged in planning, staffing, organizing, and controlling activities, which highly affects the overall performance of the organization. There are various contemporary theories and models, which can be employed by managers to enhance on-site and off-site web analytics. One of the most influential management theories is the contingent theory. It asserts that when managers make a decision, they ought to take into account all aspects, which affects the current situation of the business. For instance, by employing facilitative and participative leadership style, it will be easy to incorporate views of products and services sold by the company. Further, through facilitative and participative leadership style, it will be possible to employ the web analytic tools as a part of the CRM (Customer Relationship Management) analytics.
CRM analytics determines the likelihood that a customer will be able to repurchase a product or service, personalizes the on-site to fit customers’ needs, and monitors those geographical zones having high or low number of customers. The other contemporary management theory that has been used by major firms, such as Google Inc., to optimize on web activities is the systems theory. This is a theory that incorporates educators, writers, programmers, among other notable groups in assisting the manager to view the organization from an extremely broader perspective (Plaza 2009, p. #). They recognize the different parts of an organization, especially the interrelation of each part, such as the coordination of the central administration. By employing systems theory, it becomes easy for the managers to collect and analyze internet data in order to understand, as well as optimize web usage. This is due to the fact that information is easily shared among the various departments such as those dealing with marketing and data, a factor that significantly attracts and retains customers (Pfeifer 2009, p. #).
Web analytics is also known to have adverse effects on the type of management employed by an organization. Kotter and Cohen (2002, p. #) argue that the need for effective management to achieve the vision and mission of a firm cannot be understated. Therefore, managers should exhibit good characters, a key catalyst towards the attainment of effective management. According to Pfeifer (2009, p. #), healthy management practices are those, activities, which lead to the attainment of the set vision and mission of the firm. The flow chart below indicates the four main interrelated activities, which must be strictly adhered to by managers in order to incorporate good management in web analytic practices.
For global companies, such as Nokia, the need to hire managers who are fair, always lead by example, possesses keen insight, judgment and good communication skills, as well as adhere to set moral integrity cannot be overstated. This enables them to carefully examine the prevailing market environment, thus create opportunities, which increase customer satisfaction. This way, they are able to ensure the steady growth and profitability of their businesses. While planning and forecasting are the key functions of any good management, the most critical responsibility of managers is to anticipate and forecast the future, due to the fact that any planning carried out by an organization is good only as long as it is based on good forecasts (Eric 2004, p. #).
There are numerous factors, which influence the effective management in the global environment. As seen above, web analytics brings together people from diverse cultures, a factor that may extremely hamper effective management in a firm. One of the factors hampering effective management is lack of resources. To optimize on web page usage, there is the need for an organization to acquire and maintain high quality websites, thus attracting the number of customer’s visiting the site.
To attain this, firms ought to seek professional help from well known firms like Google Inc. among other notable online companies. Further, staffs should be well-trained on how to handle customers’ details, such as the privacy details. Kotter and Cohen (2002, p. #) argue that in e-commerce, an adequate strategic and technical planning is required. Strategic planning helps an organization to set long-term goals, rather than just being involved in the current activities. On the other hand, technical planning is the development of short-range plans and keen analysis of the current performances and data. However, in most organizations, strategic and technical plans have drastically failed due to lack of setting up sound policies, which would enhance the attainment of the long term growth of a firm.
The Impact of Web Analytics on Technology
Lenskold (2003, p. #) argues that electronic commerce cannot be carried out effectively without the use customer monitoring software, such as the web analytics software’s. As indicated above, web analytics software offers concrete details regarding the number of visitors of a given site and the time spent on the website among other notable aspects. In order to incorporate the necessary web analytic elements, there is an enormous need for businesses to evolve technologically. Globally, more than 90% of companies have realized the fact that implementing analytical tools, as well as generating reports is an important task in comparison to training employees to internalize web analytics. For instance, there is the need to web analytics managers to invest in technology, a factor that will significantly aid in evolving web release process. To help small and upcoming firms, which may not be able to invest in web analytics, Google, the leading online search engine globally, has developed Google Analytics software.
This is a free service that assists in generating detailed statistics of visitors to a particular site. The product, which has greatly revolutionized the ways companies interact with their customers, highly targets the marketers as opposed to the technologists and webmasters. Currently, it is one of the widely used online statistics services globally. Google Analytics software has the ability to follow visitors from all the referrers, such as search engine, pay-per-click, display adverting, e-mail marketing, and digital collateral like links originating from PDF documents (Eric 2004, p. #). The service, which is integrated with AdWords, enables the users to review online campaigns through tracking the quality of goals (conversations) and landing page. The goals may include viewing specific pages, sales, downloading files, lead generation among other notable uses. Kotter and Cohen (2002, p. #) indicate that through the use of web analytics, it is possible to indentify poor performing pages.
(Plaza 2009, p. #)
Generally, web analytic has plays an enormous role in technological development of most companies, as most of them position themselves to remain profitable both in the short and in the long-run.
The Impact of Web Analytics on Organization
There are a numerous crucial ways in which web analytics affects the general organization of a firm. As a result of globalization, most organizations have been forced to hire employees from different cultural backgrounds. Diversity in the work force results in differences in gender, race, ethnicity, sexual orientation, religion, disability, and socioeconomic background. To manage diverse employees in a multicultural environment, there is an urgent need for the employers to come up with policies which incorporate all the employees.
For instance, Johnson & Johnson, a global leader in healthcare products and pharmaceuticals, has developed strict antidiscrimination laws, thus enhancing equity in job places. This way the company is able to offer high quality services to its customers. For example, in the U.S. there are different laws developed by the federal government to enhance multiculturalism in work places. These laws include Title VII of the Civil Rights Act of 1964, prohibiting employment discrimination based on one’s national origin, race, sex, religion, the Age Discrimination Act in Employment of 1967, the Equal Pay Act of 1963, as well as the Americans with Disabilities Act of 1990 (Lenskold 2003, p. #).
Web analytics has also influenced managerial ethics, corporate social responsibility, as well as sustainable development of most of the modern organizations. For example, General Motors, based in the U.S., is struggling to meet the needs of the current generation without compromising its ability to meet the needs of the generations to come. As a result of this, the company has come up with automobiles which run on renewable energies, such as solar energy, biodiesel among others. Eric (2004, p. #) argues that web analytics has had an enormous effect on sustainable development. From statistics obtained from web analytics, companies are able to know the geographical zones which most of their customers are coming from. For instance, customers from the European region, the U.S. among other developed economies are highly sensitive to the issue of climate change. In order to tap these large markets, firms have been forced to develop environmentally friendly products which have zero carbon emissions. Further, there has been a need to reduce the operational cost to enable companies to deliver high quality services to customers, regardless of their geographical location.
Web analytics has also affected organizational structure and culture, team management, leadership and decision making processes. From the data obtained from the web analytics, it is possible for managers and CEOs among other stakeholders to develop leadership models, which will eventually cater for the enlarged online community. Kotter and Cohen (2002, p. #) argue that organizational culture and structure can be defined as a model of shared assumptions discovered, developed, or invented by a group of people. The main aim of developing this structure and culture is to enable them to effectively deal with problems of external adaptation, as well as internal integration. Organizational culture and structure is crucial in enhancing the short and long-term sustainability of a given company. For instance, Apple Inc., which is a global leader in consumer electronic products, has developed the culture of innovation and invention. Through transformational leadership style embraced by the co-founder Steve Jobs, the firm has been able to come up with revolutionary products and services, such as iPhone, iPod, iPad, Macintosh line of personal computers among others.
From the above study, it is now clear that web analytics plays a vital role in the sustainability of any given firm. For most of the global firms, the need to locate the geographical location of their customers has drastically increased. This way, a firm can be able to offer personalized services to the customers, a factor that significantly improves customer loyalty, hence increases profitability levels. For companies to remain competitive, both in the short and in the long-run, there is a need to invest in on-site and off-site web analytics, thus increasing customers’ satisfaction levels.