How Does Google Analytics Work? (Easy Guide for Beginners!)

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The definition of “analytics” is “the systematic computational analysis of data or statistics.” So anything named “analytics” has to be complicated and only for computer nerds, right?

Actually, no. We don't believe that here and neither should you. And we'll prove it to you.

You might need Google Analytics for your own business or to help a client. Either way, you deserve a simple, down-to-earth explanation of how it works and how to best use Google Analytics to drive results.

Read on to find out how Google Analytics works — for ordinary people.

The Three Functions of Google Analytics

Google Analytics is a measurement tool available from Google. At its most basic level it does three things:

  •  it collects information
  •  it stores the information
  •  it reports on that information 

Google Analytics is essentially a big behavior database. It tracks users and tells you who visited your site and what they did while visiting.

Analytics answers four key questions. 

  • Who are my users? 
  • Where are my users coming from?
  • What actions are they taking?
  • What is the result of the actions they're taking?

Tracking your users in Analytics shows you if your traffic sources are worth it. For example, you can find out if your Facebook ads are actually generating leads. You'll be able to visualize your funnel in new ways, knowing what traffic sources lead to revenue for your business. 

Analytics will help you  make the decisions you need to optimize and improve your performance. You can figure out which ads work best and whether your blog is actually driving new leads. 

With Google Analytic's purpose clear in mind, let's dive in a little bit deeper (but not too deep) into how the technical side works.

(Note: Want to start tracking your traffic like the Pros? Get the Traffic Tracking Toolkit as part of your free “Toolbox” membership.)

C is for Cookie (And That's Good Enough for Google)

The primary mechanism Google uses to track users is called a cookie. Cookies are small pieces of information that are stored on a user's computer and are unique to that user and the browser they're using.

There is a small ID number inside the cookie. Analytics tracks people by lining up the ID in their cookie with an ID in their database. If the two IDs match, Google knows that it's the same person coming back to your website.

Another way to explain this is… While in line at an amusement park, you feel a tap on the shoulder. A worker asks you to wear a small wristband and deliver it to another employee at the end of the line. They want to see how long it takes to get through the line.

If an employee needed to find you specifically while you're in the middle of the line. He would check everyone's wrist for the specific wristband you were given. That wristband identifies you apart from the rest of the crowd.

Similarly, the cookie Google Analytics places on a user's machine uniquely identifies that user to Google Analytics. It looks for that cookie among all of your visitors. If it doesn't find one, it generates a new “wristband” for that user and places it on their machine.

Google Analytics gives you the ability to track users and watch which pages they visit and what actions they take. 

Let's take a look at the basic structure of Google Analytics.

Google Analytics Users vs. Sessions

One of the common points of confusion is the difference between users and sessions. We go in-depth on Google Analytics users in another post, but here are the basics.

Users represent the individual people that visit your site. As we've seen, this really depends on the cookie placed in their browser.

Every time a person visits a page, called a pageview, analytics stores this as a hit. These individual hits roll up into sessions (think of them as visits to your site).

Every user can have multiple sessions, and each session has multiple hits. For example, if someone clicks on your Facebook ad and visits your website, they'll be marked as a user and given a cookie. What they do during that visit will be stored as a session.

If they come back later through email after joining your email list, they'll be marked as a returning user and be given a new session for this latest visit.

Check out the GIF below for the full workflow of how Google Analytics tracks users and sessions:

It's not necessary to understand the nitty-gritty details of every data point you see in Google Analytics. The best way to think about Google Analytics is how can you use it to make better decisions.

A Framework For Making Google Analytics Useful (Even If You're a Newbie)

Do you get discouraged when you go to the gym and see someone with an impressive six-pack? You may feel the same way when you see Google Analytics the first time. When giving the local gym rat the death stare, you don't see all of the work and effort that went into getting into such great shape.

Effective measurement is muscle. You have to practice to make it stronger. What you need is a proper framework to begin working that muscle, or you'll freak out and give up.

A useful framework is like the elliptical, treadmill, or universal workout machine at the gym. It gives you the tools you need to build muscle over time continually. Don't go into Google Analytics and find what's there. You'll get frustrated quickly.

Instead, start with a clear plan and strategy. You'll be able to build your measurement muscle over time and ignite your business results.

Introducing the QIA Framework

The QIA framework is what we teach to Google Analytics users of all levels. But it's even better for those just starting out. You won't get the bumps and bruises most marketers get before taking advantage of this method.

The “Q” stands for “question.” What question do you want to answer? 

Google Analytics exists to answer questions. Take the time to think about some questions you need to answer before you begin using analytics.

There are two types of questions. Results-oriented questions ask about concrete results. An example is, “How many sales did I make this month?” The second type, how questions, ask how these results came to be. An example would be, “How many users saw my offer?”

A good set of result-oriented and how questions will give you the best foundation to start getting value from Google Analytics.

The “I” stands for “Information.” What information will you need to get the answer?

Find out whether the information you need is currently being measured. Then find out where the data lives inside of Google Analytics.

If the information you need doesn't exist in Google Analytics yet, then you'll need to find the best way to get it into Analytics. 

The “A” in QIA stands for “Action.” What action will I take based on the answer I get? 

Reading data all day accomplishes nothing unless you take action on the information. Ask yourself three questions:

  • What will the answer look like (the report)?
  • What will I do if the answer is X?
  • What will I do if the answer is Y?

Plan ahead, so you know what actions to take based on the answer you receive.

Let's work through an example, so you know how to apply this to your business.

Question: Are my Facebook ads giving me leads?

You're spending money on paid ads, and you want to make sure those ads are working. Once you have a good question, you need to find out where the information lives.

Information: Where does Google Analytics tell me information about my Facebook ads?

By default, it'll be difficult to tell which users came from your Facebook ads. But you can add that information by adding UTMs to your URLs.

UTMs allow you to tell Google where users are coming from. Think of them as a return address on a package. You can tell where the box came from at a glance. UTMs allow you to pinpoint exactly where your users came from. This is especially useful when you have multiple Facebook ads pointing to the same piece of content.

There are five UTM arguments you can add to your URLs:

  • Source – The branded source of the click (Facebook, Pinterest)
  • Medium – The general type of traffic (paid ads, email)
  • Term – The subject line of the email or the ad headline
  • Content – Use this to differentiate this ad from others (i.e. “img-puppy-blue-eyes”)
  • Campaign – A product or service you're promoting

When added to your URL (check out Google’s URL builder for an easy way to generate these URLs), it’ll look like this:

www.<yourwebsite>.com/<your offer>?utm_source=facebook&utm_medium=cpc&utm_term=need-our-widget&utm-content=img-child-with-flowers&utm_campaign=spring_sale

The URL looks long and confusing. But take a look at each parameter after the question mark. These create the return address label for Google Analytics.

Now Google Analytics will know exactly where your users are coming from. In the above example, the user clicked on a Facebook ad with the headline “Need our widget?” and an image of a child playing in flowers. This ad is used to support your spring sale.

Join this information with the number of conversions on your landing page, and you'll know whether your Facebook ads are generating leads for your business.

Action: You can create a report in Google Data Studio to show you how Facebook ads are affecting your leads. 

For example, you may want at least a 40% conversion rate to feel that your ads are working.

The next question to answer is: What will I do if the conversions are higher than 40%?

You might scale up your Facebook ad spend or analyze the offer, so you can make more just like it. 

You also need to plan for the opposite. What will you do if the conversions are less than 40%? 

Will you analyze the offer to see if it could be improved? You could also see if there is a mismatch in messaging between the ad and the landing page.

The key is to think ahead. Plan how you’ll react to the results before the campaign starts. And then build Google Analytics in a way that tells you the real story.

Google Analytics Isn't Scary — When You Plan Ahead

At first glance, Google Analytics is intimidating. If you jump into the numbers and start digging without a purpose or a plan, you'll run away with a headache, vowing never to go back in.

Frameworks are your friend. A framework helps you to use those measurement muscles and practice to get better. They give you a smoother transition, helping you to ignore what's not important right now and focus on what matters.

Use the QIA framework we provide to plan your Google Analytics. If you need practical help to get the most out of Google Analytics, check out our Traffic Tracking Toolkit. You’ll be up to speed on UTMs in no time.

And you don't have to be a computer nerd. You just have to care about making your business better.

(Note: Want to start tracking your traffic like the Pros? Get the Traffic Tracking Toolkit as part of your free “Toolbox” membership)

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