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Simply Defined

The simplest definition of analytics is “the science of analysis”. A simple and practical definition, however, would be how a business arrives at an optimal or realistic decision based on existing data. Managers choose to makes decisions based on past experiences or rules of thumb, or there might be other qualitative aspects to decision making; however if data isn’t available it wouldn’t be considered analytics.

When dealing with “web analytics” the easiest and most efficient way I’ve found to explain it is like this:

Scenario

When you go into a grocery store and view products, the store isn’t able to tell what items you look at, what isles you go down, what products you purchased, and/or how long you have been at the store.

To combat this, the store implements some analytics to identify these types of questions or concerns. This technology is called “Web Beacon” technology; however since we are going to keep it simple we will call it something else….

Guilty Spark

An Xbox game called “Halo” had a character called “343 Guilty Spark,” which was a floating orb that followed the main character around helping you out.

Imagine that this same orb followed you around in the grocery store, not asking or looking for any type of personal information, but rather looking at basic information, such as the types of products you look at, isles you go down, etc… This orb would follow you throughout your entire visit to the grocery store, once you left, it would stop tracking you. It would then keep track of that data and store it in a database, so that if you came back it could remember who you are.

This would happen to every single person that would come to the store, allowing analysts the ability to see what isles, products, etc.. are most viewed in order to optimize the store for maximum optimization.

Now What?

The data that is collected allows analysts (like me) to review the data and make suggestions to optimize the service. These services range from many different things, and could either be beneficial to the business or extremely detrimental…it just depends.

In order to get a little more background into the question, I would suggest reviewing “Occam’s Razor by Avinash Kaushik.” This guy is absolutely amazing when dealing with analytics and provides invaluable.