In this hunting journal we will continue our discussion of understanding the information that is before you when hunting that elusive ROI. Specifically we will talk about web logs and understanding why standard deviation is important when placed against your goals.
If the term is not understood, think of it this way. Standard deviation tells you how spread out your data is from the average score of your data you’ve collected. It is a mathematical equation that looks at the frequency distribution of your data. The larger the score the more spread out the numbers are, the smaller the score the closer the numbers are. The calculation looks like this (but I like to let excel do this rather then calculate it by hand):
Ok, so now you have this number and you are asking yourself, who really cares about this stuff? People who are trying to understand how to improve their web site do! Let’s take a look at one more picture before we try to apply this information. The normal curve:
I’m proud you stuck with it this far, but I can tell you still have that glazed look in your eyes like, should I read on or not? Well let’s apply some of this and then you can post a reply and let me know if it was helpful.
Let’s say you are responsible for increasing the page views on your site because your revenue is based on ads sold to visitors. Well, if you calculate the monthly mean and then the standard deviation you can have a good start. Let’s say that your average pages views are 4.9 and your standard deviation is 1.13, in other words 68% (+/- 1 SD) of your visitors view 3.77 (4.9 – 1.13) to 6.03 (4.9 + 1.13) pages each time they come. So now you can start analyzing the sessions that are greater then +1SD in page views or in other words 6.03 to try and figure out why that group of people view more pages then all the rest. This may mean redesigning your home page to have more links because you see them returning to it always in the path analysis, or adding more links to highly visited pages, etc. You can do that same analysis on -1SD and see what’s going on with people that view less then 3.77 pages per visit as well. Maybe some pages need to be modified to improve the page views.
Let me know if this is helpful, send me some of your examples if you are confused, more to come on this topic!