Why You Need An Independent Analytics Audit
Is your digital analytics data is being presented clearly and honestly? Columnist Alan K'necht explains why you need an analytics audit — and why it should be conducted by an independent body.
In front of you is an analytics report touting the success of a recent digital marketing campaign. Full of colorful charts and graphics, the report demonstrates how the campaign drove an unbelievable number of visits to your website. A stirring in your gut tells you something isn’t right.
The numbers look right, but are they? Did the team measure the right things?
Why did they choose the Key Performance Indicators (KPIs) they are reporting on? Do they fully understand how the KPIs correlate to overall business objectives?
Do you fully understand the KPIs and their evolution over time?
Your gut is probably right, so you decide to initiate an analytics audit conducted by an independent auditor. The auditor’s report proves that your gut was, in fact, correct.
Now you think your original marketing firm is either inept or run by con artists. Of course, they may well be extremely good at what they do and simply bad at analytics, or maybe they were just trying to showcase their efforts in the best possible light.
Digital marketing analytics has matured over the past 20 years into a true discipline guided under protocols and best practices of the Digital Analytics Association, which your marketing agency simply doesn’t know about or chooses not to follow.
Mistakes Lead To Questions
In a recent scenario we dealt with, a marketing agency reported to the client an allegedly successful campaign by showing high levels of increased traffic.
Yet the audit revealed the marketing firm hadn’t filtered out traffic that originated from their own IP address and those of their staff members. Including it in both day-to-day operations and in report data has a cascading effect on the validity of all data being used to make decisions around the campaign.
The overall online marketing goal for this client is lead generation, and only reporting increases in traffic (using erroneous data) was the wrong KPI. For this campaign, the agency should have measured filtered Visits/Lead. That would have provided a clear indicator of the quality of the traffic generated via the campaign.
As it turns out, this more relevant KPI was far below what the client considered to be a best effort. When another KPI, the true cost per lead, was examined, the campaign was seen to be a colossal financial failure.
Mistakes lead to questions which should lead to solid answers.
Is your company counting traffic from internal staff to an external website? What about traffic from various marketing agencies and third parties that could be artificially inflating the data?
How could this scenario have been avoided? What other digital marketing efforts are not being tracked correctly?
Is any of our corporate data accurate and trustworthy? What courses of action should be taken to prevent decisions based on irrelevant or even wrong data from happening again?
The obvious answer to each question above is to engage a completely independent business to conduct a full and impartial audit of your digital analytics data.
The Necessity Of An Independent Analytics Audit
To understand the need for an audit and why it should be conducted by an independent body, one needs to look no further that the definition of an audit:
Corporations audit their staff expenses and have outside accounting firms to audit their financial records, yet they often ignore the accuracy and quality of their own digital analytics data.
These data, collected and used to analyze various online marketing efforts, are nearly as critical as the corporate financial data. High-quality business decisions are hard to make without high-quality data.
Everyone understands why they don’t audit their own financial records. Rarely do they grasp the reasons for an independent analytics audit.
At first glance, it’s hard to understand what truly needs to be audited when it comes to an organization’s analytics data.
Many issues can be discovered. Some are just mistakes, but some are misrepresentations (some of these could almost be considered criminal, or at the very least, extremely unethical).
As with a financial audit, the goal of an analytics audit is to ensure that data being reported is “true and correct.” Companies should hire independent analytics auditors for the same reason they should hire independent auditors for their financial records:
1. Independent auditors know industry best practices.
2. They do not have a set agenda.
3. The findings are unbiased.
4. The sole goal is to find and report on the truth.
5. There are no incentives to hide or misrepresent facts.
Knowing industry best practices is one of the most important areas where an independent auditor can help. The goal here is to ensure that all data being captured and reported are correct and collected in a manner that’s consistent with best practices.
The auditor’s job is to review everything with two goals in mind: a) to find any issues, and b) to verify everything is as it should be.
Auditors don’t have hidden agendas. Their next raise or annual bonus isn’t based on specific KPIs. The renewal of their existing or future agency contract isn’t dependent on demonstrating specific achievements.
Without engaging an independent auditor, can you truly trust that the data is being presented clearly and honestly?
The goal of the marketing agency is to demonstrate how well their campaigns are performing with the ultimate goal of renewing the contract and acquiring additional business. The goal of an in-house marketing team is to ensure they meet their business objectives in order to qualify for bonuses, annual raises and promotions.
For these reasons, they routinely choose simple measurements that only highlight (or can be interpreted to highlight) the success of their efforts. It’s only through an independent audit with no set agenda that the correct KPI can be identified, the fraudulent traffic eliminated and the truly successful campaigns measured and presented with quality data.
Audit Scope: Go Beyond The Data
A full and complete analytics audit looks at more items than just the data and the reports. It should also examine:
- All analytic data sources (not just the Web analytics).
- Where the data is stored (on-premise or at vendors).
– Is it stored securely?
– Is it stored according to corporate data storage and privacy policies?
– Is it stored and protected in compliance with jurisdictional privacy laws?
- Whether all the people who receive regular analytics reports understand the data they are receiving.
- Whether all appropriate people receiving and reviewing analytics reports on a timely basis.
- All current KPIs for accuracy and appropriateness.
How Often Should Audits Be Conducted?
As with financial audits, a minimum of once a year is recommended for a full and detailed analytics audit.
Additionally, a partial analytics audit should be conducted after two or three months following use of a new vendor that provides their own performance reports. This will ensure those reports are accurate and in line with corporate objectives.
Lastly, conduct an audit when something smells fishy. If the performance looks too good to be true, the odds are something is wrong, and it needs to be identified.
Only after your analytics data is verified to be correct and the appropriate KPIs are in place can you begin to truly reap the benefits of quality data.