If you’ve been in the digital marketing industry for any amount of time, you’re probably familiar with the way “reporting” and “analytics” have often been used interchangeably. However, while both are functions of business intelligence that help you understand your business data, they are different in both form and function. It is important to recognize the distinctive natures of each term, how they are different, and how they can be used in conjunction to optimize your business strategies.
Why is it important to understand the differences?
Without fully understanding the purposes of both reporting and analytics, and how they are most effectively utilized both separately and together, you may not be able to enhance your decisions to the fullest potential. When we use the terms analytics and reporting synonymously, we can diminish the results they each bring to be used for our benefit in our digital marketing approach. If increasing the value of your business is important to you, it’s pretty vital to understand the key differences between analytics and reporting in a marketing context and to apply their functions accordingly.
So let’s start by breaking it down and defining what both of these terms mean in general, and then in the context of your business, data, and strategic decisions.
Reporting:
When data is summarized in a way that provides clarity, insight, visualization, and better comprehension of your company’s metrics, this is called reporting. Reporting extracts your business data and presents it in a way that simplifies the conclusion making process, allows you to make comparisons, and determine whether or not you’ve reached your target goals.
However, while your data may be summarized in a more concise and digestible way that can allow for personal analysis and insights to be drawn, true analysis-driven interpretations which help shape your business decisions cannot be made at the reporting stage.
Say for example you want to observe certain metrics such as the number of new customer acquisitions, leads and conversions, and cost per lead for your business over the past month, three months, and six months. Reporting shows you these raw data and numbers to help you identify patterns and trends while also making room for you to ask questions about what you see.
In another example, you may study a report and wonder why your customer acquisitions fell during the third week of the month, but doubled the next. Or you might use a report to see if you reached your expected website traffic goals. Whatever it may be, reporting makes your data readable and sets you up to take the next step in understanding why: Analytics.
At Lift Digital Marketing, we run reports such as our Free SEM Audit, which ultimately help you get the best results out of your marketing spend.
Analytics:
Analysis, on the other hand, involves the process of converting data into insights that allow you to understand the “Why?” behind questions raised from reporting. Analytics incorporates external business knowledge as well as trends, patterns, and splices that invite you to question your data in order to drive and optimize your business decisions going forward. While reporting can only tell you what is happening, analytics can give you more insight into why things are happening and what it might mean based on the marketing strategies and tactics you’ve been applying or changing.
More specifically, analytics can provide beneficial information about your target audiences and audience behaviors. Gaining clarity on why your target audience is behaving or responding in certain ways or patterns can be crucial in how you choose to approach shaping your best practices and next steps for your business strategies.
For example, analytics may enable you to acknowledge which marketing efforts are contributing to an increase or decrease in traffic or social media engagement. Analytics can also allow you to determine how much of your conversions or results are a product of certain campaigns, give you better insight on which channels are providing the highest ROIs, and examine whether certain tactics are achieving the expected results.
Why is this all of this important? Improving your best practices and practical tactics is one effective way to gain the most reward for the cost and effort being put into your marketing efforts.
Now that we know the differences between reporting and analytics, how can they be used together to improve your digital marketing efforts?
- Learn – The whole point of reporting is to make your business data readable and easy to monitor. Take in the information that’s been summarized and learn where your strengths and weaknesses are, where you may be falling behind target goals, and areas you want to improve. Skipping this part of the process will make moving forward an impossible feat!
- Interpret – Interpret the message your data is trying to tell you, and connect it to existing strategies, campaigns, channels, or changes your business has experienced or made. Understanding why something is happening can help you improve your practices to keep you on par with your goals.
- Collaborate – Good things can come from teamwork. Once you learn from and interpret the data presented to you, you can collaborate with your colleagues to make the best moves forwards. What aspects of your digital marketing approach need more or less attention? Which channels are reaping the highest rewards?
- Apply – Last but not least, apply your business decisions and see the benefits of your efforts.
At the end of the day, with reporting and analytics, you can’t have one without the other. Using the two tools in conjunction will enable you to make the best decisions for your business moving forward.
