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Google's Free Analytics Raises Concerns

Advertisers and SEO firms are concerned about Google's announcement yesterday that it will launch a free Web analytics service for all publishers and advertisers.

After selling analytics services through its Urchin service for $199 a month, Google now is making its Google Analytics service free to all businesses. AdWords advertisers can access the service from a new interface in their account and are allowed more page views than non-AdWords firms.

The technology can “track the results of any online marketing campaign, including banner ads, referral links, e-mail newsletters and organic and paid search,” according to a statement from the company.

But some in the search marketing industry view the move as another Google power grab, taking business away from the search marketing agencies and Web analytics companies that traditionally analyze and manage advertisers' campaigns.

Google already has nudged its way into several non-traditional markets this year, including putting books on the Web via Google Print and placing advertising in traditional mediums, such as magazines. And advertisers are concerned about the competitive upper-hand the analytics tool gives Google as well as keeping their search campaigns' performance private.

“The concern among some larger advertisers is that it is giving Google insight into how well their media is converting, relative to other media. If they know their media is converting 20 percent better than other media [for example] it gives them additional pricing power,” said Bryan Wiener, president of search and performance marketing firm 360i, Atlanta. “You don't want the vehicles from which you're buying media too close to your strategy.”

“Privacy is a huge concern. Google saying they place a huge importance on this sensitive information doesn't make me feel all warm and fuzzy. At the very least, they are going to use it [information collected] in aggregate form,” said Lisa Wehr, CEO of SEO firm Oneupweb, Lake Leelanau, MI.

While smaller businesses that would not typically hire an outside analytics firm may sign up for the free analytics, Wiener and other executives don't expect Fortune 500 companies to use the service.

Google can only provide the analytics data, not provide knowledgeable staff to help companies to improve their search campaigns, SEO executives pointed out,” Wehr said. “Analytics are only as good as the people analyzing them. They're not trained in direct marketing systems.”

Still, some SEO executives weren't concerned about Google taking their business.

“Google is going after a different type of client — Fortune 1000 companies — than we are. They [the companies] do become another number,” Wehr said.

And the service can offer benefits to smaller advertisers, SEO executives said.

“Some people pay $15,000 a year for analytics. Advertisers could say, 'This is great information at no charge,'” said Danielle Lietch, vice president of marketing and analytics at search marketing firm MoreVisibility, Boca Raton, FL. “I can understand why people would be concerned, but I don't know that it is so detrimental that it can outweigh the benefits. It's helping to educate the advertiser … to analyze their data and make decisions on their bid budgets and spends.”

Chaz Felix, vice president of e-mail marketing firm Bronto Software and a Google advertiser, agreed.

“Google's business customers definitely benefit from the price elimination [$200 a month in most cases], tighter integration with AdWords and commitment to future product development,” Felix said.

An Analyst's View on Google Analytics

What does Eric T. Peterson, senior analyst at JupiterResearch and Web analytics guru, have to say about Google Analytics? DM News' Mickey Alam Khan asked him what this meant for advertisers, agencies, Web analytics firms and middlemen in general.

Good for advertisers. Google Analytics is definitely good for advertisers interested in getting visibility into how their marketing and advertising efforts are performing but who are hesitant to invest in a for-fee solution until they have the basics down.

Historically, when faced with the choice of buying a solution, looking for something free or open source or doing nothing, advertisers did the latter and relied on click-through, etc., rather than the valuable conversion data that Google Analytics will provide.

Not so good for analytics firms. I'm not clear that this is bad for agencies per se. Companies that jump on this announcement and provide value-added support for Google Analytics, and analytics in general, are likely to be busy. The problem is that you cannot simply materialize analytical expertise.

Bad for other Web analytics firms? Most likely, yes. Except for companies clearly differentiated as high end, those companies that are very well established and those companies that provide strong business support, I'm not sure how Google Analytics can fail to have a negative impact on the bottom line.

I think that this is the biggest Web analytics announcement recently — perhaps ever — which will drive interest in the subject across the board. It's just not clear why any marketer would pay for the service when Google is providing it for free.

I don't think Google is explicitly trying to cut out the middleman. I think they're just being smart and considering the eventual needs of their AdWords customer base: Eventually all of those people will realize the need for Web analytics. Now they can get it with a few clicks of a button. Pretty shrewd of Google, really.

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