Should Google Offer a Paid Version of Google Analytics?

Published by Adam Greco on February 7, 2011.

Recently there has been some rumor buzz about Google releasing a “paid” version of Google Analytics (beyond what is currently available through Urchin). Assuming, for a second, that something like this is coming in the future, the real question is whether this is a good or bad idea. In this post, I’ll examine some of the pros and cons to this potential move by Google.

Why Google Should Offer a Paid Version

So what are some of the reasons that Google should offer a paid version of its web analytics offering? I can think of the following:

There will always be a group of web analytics users that want advanced functionality and are willing to pay for it. These advanced features are often resource-intensive and I could see Google wanting to recoup some money to enable these features or the additional data storage they necessitate.
There are millions of websites using Google Analytics for free and if Google can extract even a small amount of revenue from these, it can add up quickly. Since I don’t think Google is hurting for revenue, I assume that the money generated would be filtered back into the product which would mean even more enhancements to a product that pretty robust already.
One of the reasons Google may be thinking about offering a paid version of the product is to open the door to its sales team to cross-sell other Google products and services. By being free, Google Analytics has infiltrated millions of websites which creates an easy entrée for a Google sales rep to say: “I see that you are using Google Analytics, did you know that Google also offers Google Ad Words, Google Apps, etc…” While they can already do this, if a company has already started paying for Google Analytics (and it has made it through procurement!), that makes the cross-sell so much easier. It also helps weed out the companies that are serious, which will often be the ones willing to pay.
Services baby! It is no secret that professional services are a huge money maker. When I was at Omniture, we had a sizable consulting group and there are a host of other firms (including Web Analytics Demystified of course!) offering services around web analytics. While I am not sure if it would be a good move or not, Google could offer paid-for services around a paid-for web analytics tool itself or through its certified partners.
Competition! I love competition. I think it helps drive innovation. In my opinion, the consolidation of the web analytics industry over the last few years has reduced the amount of innovation and I think Google having a paid product will ultimately mean that everyone in the industry gets more.

Why Google Should Be Careful About Offering a Paid Version

So what are the pitfalls that Google might want to look out for? Here are a few worth considering:

Too much functionality! One of the strengths of Google Analytics is its simplicity. Since it is a free tool for most users, it has not been beholden to the axiom that more features must always be added to continue justifying the investment. Like all software products, as time goes by, more features are added to meet the needs of the most advanced users, which often results in casual users leveraging 10% of the functionality. While it looks like Phil & Nick have done a great job adding the features their users want to date, once someone is paying you money, the balance of power tends to shift in a big way (think difference between privately held vs. publicly traded company). I hope that Google will not lose its simplicity “mojo” that got it to where it is today.
Customer Support? One of the biggest expenses for software products is the cost associated with supporting its customers. When I worked at Omniture, we had a massive customer support organization of account managers and client care that grew exponentially. If Google has paid clients, I would imagine that it would need to provide support at a level that far exceeds what it is offering today. This is not an easy task and Google is known for being somewhat hands off for most of its products. When your product is free, people accept that they are going to be on their own more than when they are paying for something and if support isn’t good, I could see Google Analytics losing a bit of its current luster. I also imagine that Google loses quite a bit of money on Google Analytics (which I assume it makes up for on the AdWords side), and this will be even worse once it has to staff up to support users unless it can find a way to get its partners to offer that support.
SLA’s (Service Level Agreement). Paid-for vendors have legal requirements around the availability of the product and the handling of product issues. To date, it is my understanding that Google Analytics has not had SLA’s since it is a free product, but I would imagine Google would need to provide a reasonable SLA for the paid side. SLA’s are never fun and usually end up costing time and money…
What happens if no one buys it? Google has done a lot of things that have changed the market and some that have not done quite as well (i.e. Google Wave). Google shook up the web analytics industry in a huge way with free Google Analytics, but what would it say if only a small % of companies decide to pay for its product? Does this serve as a boost to its paid competitors? I guess the real question comes down to this. If I am a Fortune 500 company and am currently using Google Analytics and a paid product from Omniture, Webtrends, Coremetrics or Unica (which is very often the case!), what features will Google Analytics add to its paid product that will get me to only use Google Analytics and get rid of my other paid vendor? I would guess that the things I would be looking for are 1) my own dedicated servers so I know my data is really my data and can be kept as long as I want, 2) knowledge that Google is not seeing any of my data and using it in its search algorithms, 3) support and SLA’s at the same caliber I am getting from my other paid vendors and 4) 90% of the features I can get from my other paid vendor. If Google can deliver on these items (and I am sure it can), I think it will make a compelling case as to why companies should standardize on Google Analytics, but I don’t think this will be something that happens overnight.

Obviously, all of this is still speculation, but I, for one, look forward to seeing what Google does and how they address some of the items I have described here.

I highly recommend you check out this YouTube video on disruptive innovation. I think it is very cool to watch this and think about Google being the “entrant” and the other paid web analytics vendors as being the “incumbents” described in the video. This video talks about what Google has done to the other paid vendors and how Google could one day become the incumbent and fall prey to even newer entrants (or reincarnations of the old incumbents!). Fascinating stuff!

So what do you think? Will they do it? Will people buy it? What things do you think Google needs to do to make it successful? Please share your thoughts by adding a comment here…

About Adam Greco

Adam Greco is a longstanding member of the web analytics community who has consulted with hundreds of clients across every industry vertical. Mr. Greco began his web analytics career managing the website for the Chicago Mercantile Exchange, became one of the founders of the Omniture Consulting group, and was most recently Senior Director of Web Analytics at Salesforce.com.

Want to speak with Adam? Contact Web Analytics Demystified

Adam Greco Blog at Web Analytics Demystified

Posted Monday, February 7th, 2011 | 15 responses | Share, Save or Email

Judah

Hi Adam,

Yes, if I had to place my money where my tweets were with @immeria on this topic last week, I would say that Yes, Google will release an Enterprise version of GA this year.

It’ll cost a minimum of 6 figures and have a strong, real corporate SLA with strong privacy/data usage restrictions, no data limits, and an advanced API. I’d even postulate that it would have an encrypted connection to corporate directories, such as LDAP or AD.

It’s not for little sites – and Google will have one or few select partners certified to provide services – that’s it. It only makes sense that it would work that way. Who are the best GAAC’s? They will be the only GAAC’s for GA Enterprise.

None of this should come as a surprise to anyone with their ear on the train tracks as the Google Sales team has already been shopping this idea around for some time…

However, no one in the web analytics industry will confirm it for me! But this is all just so obvious to me from footprints in the sand and echos in the mountains…

And if I were a vendor, I would be thinking how to counter this move because if Google wants to eat your lunch, they will eat it.

Anyway, nice post.

Judah
http://web.analytics.yahoo.com Matt Lillig

Interesting.

Matt Lillig
Yahoo! Web Analytics Strategist
Visitor

OK, nicely summed up.
But do not figure GA as the inventor of Analytics.

A lot of work was invested by the REAL vendors to have website optimized by WA. Then, Google copied it and made it free since it had a massive financial and resources power in the back. Smart? Yes. Cool? No. Leading? For sure not.

Did you know that Google is not a search engine company but an advertising space company. So do not assume that they are not hurting for revenue. I think Sergey and Larry made some money to enjoy their life. But have they done so and stopped their business? Yaah, right…
Michael Drayson

Interesting article but you can never really have enough functionality, can you?

Michael Drayson
Hotels.com Senior Web Analyst
Leslie

I think it would be wise for Google to offer a paid version that would ensure the security of the data being collected. As the axiom goes, nothing is really “free” and the price GA users pay is knowing that their information is being used by Google to set ad rates, can often be “shared” or found on other websites, and who-knows-what-else. For a company who sees these potential data leaks as low-risk to their business, free is fine. For those who see it as a threat, this would open the GA market.
http://www.l3analytics.com Peter

I think it is likely only a matter of time until Google releases a paid version of GA with the primary feature being a SLA. Just the availability of that peace of mind could be holding back a number of bigger organisations from using GA ahead of their paid competitors.

I had a number of other points to raise, too many to do so in a comment so ended up writing a post about it – http://bit.ly/fT8Brb. Looking forward to seeing what happens though.

Peter
http://www.gilliganondata.com Tim Wilson

Hmmm. I disagree with “Visitor” — Google may have somewhat been standing on the backs of vendor work done before, but they quickly took Urchin and converted it to something that was intuitive, accessible, and pretty feature-rich, and they’ve continued to push the product and have rolled out features that the Big Boys have then had to play catch-up on.

To me, the features that they could offer in a paid version: 1) lifting the restriction of “no user-level tracking” in the ToS (which might be sticky for their brand, so may not happen), 2) adding pathing capabilities a la Sitecatalyst (which means adding a way to do aggregated pathing — getting to a similar result of Traffic Variable pathing in Sitecatalyst), and 3) enabling the uploading of meta data (Sitecatalyst: SAINT files, Webtrends: translation files) and incorporation into reports, 4) enabling segmentation to work on conversion funnels.

That, at least, was my knee jerk list of feature wants.
Paul

Interesting topic. I see one major problem you didn’t list with any enterprise offering that would come from GA: cross-channel advertising.

In a world where enterprises have ad revenue spend on Facebook (Google competitor), mobile (Apple Ads as well as other mobile ad networks), Google, Bing, twitter, etc. either Google is going to have to start offering analytics showing effectiveness of other advertising channels that compete with their own or they will always be seen as a point solution for “Google” analytics.

Even should Google start offering ad words tracking on Bing, Apple’s Ads, and analytics on Facebook (doubtful considering their competitor status), customers will naturally distrust the data (can Google really be unbiased about their ad network?) and/or competitors can/will block Google analytics (Facebook is a threat and, I think, Apple already blocks Google from Ads).

I’m not saying that Google can’t overcome these aspects but it is going to be a serious challenge. And it doesn’t make good business sense for them to do so. Will they really make so much profit from enterprise analytics that it would offset the potential damage to their position in advertising?
http://120feet.com 120Feet

If the data was owned by the client (and not Google) I’d love the option to capture personal data so that my analytics can drive communications; namely basket abandonment, upsell etc. So a campaign management and delivery capability would be awesome.
http://www.userflow.net Matt Clark

Interesting idea, but I’m pretty sure Google was offering a couple of different versions of Urchin for a while which were aimed at Enterprise level users.

Since these are no longer around I’m assuming they have been superseded by the numerous upgrades that have been made to Google Analytics since then.

Google took over a subscription based analytics tool (Urchin) and has made it free, before going on to significantly develop it, I think they are moving away from paid towards free. This after all is in line with the vast majority of their other tools, which are also free.

If Google did release a paid version of GA what would the added benefit of subscription be?

Businesses at the highest level are already moving away from clunky paid tools towards GA and instead diverting budget to analysts who put the data to work. After all analysts / conversion practitioners will get far great ROI than having a couple of extra features in the tool itself.

So, I would be pretty surprised if Google released a paid version of GA, since a big part of the subscription cost of analytics tools is the support and if Google were to provide that themselves that would seem to render the GAAC scheme redundant?

But we will have to wait and see!

Paul – It has always been possible to track other traffic sources by tagging up the campaign urls with tracking parameters. You can’t get the cost data though, but i don’t know if Facebook etc. would make it available?

Matt
Conversion Consultant
Userflow.net
http://adam.webanalyticsdemystified.com Adam Greco

Thanks for all the great comments:

Judah
Agree with all of your points. I think if Google does it the offering will be for high-end customers.

Kohl
Yes, quite aware Google was not an inventor of web analytics. They did, however, fill a need in the space when they offered a free product for the masses.

Michael
Some people would argue that you can have too much functionality. Think about Mac vs. PC. Some would argue that too much functionality hurts more people through usability than it helps though power usage.

Leslie
While I think Google does a fairly good job of walling off GA data, your point is well taken.

Peter
Great follow-up post! Thanks for adding the GAAC perspective.

Tim
Great list. I think many others would like to see those features added as well…

Paul
Great point. I have heard many people complain about using data from an advertiser who competes against other advertisers (something about a Rooster guarding the hen-house!). I think this is a valid concern and would be interested to see how Google approaches this. This is one of the selling points of using a traditional web analytics vendor that has no ties to advertising.

120Feet
Agreed, as long as you are adhering to the “Code of Ethics!” This is a tough one for Google since they have privacy hawks watching their every move. I wonder if there would ever be a way to run GA on-premise? I doubt it, but we’ll see…

Matt
I think this is why people were a bit surprised by the news. Maybe Google was a leader in the Freemium model before we al knew the term Freemium
http://www.razorfish.com Alex Brown

Hi Adam,

Nice article. Isn’t it great to see competition heating up in the web analytics space. There are some complimentary musings on the subject of a paid GA offering here: http://bit.ly/ekudlX

The new interface of SiteCatalyst (v15) and Google Analytics both bring some much needed face lifts and features to market – proof hopefully that businesses are listening to customers have more.

Regardless of whether a free or paid web analytics tool is used, one thing is for sure… It’s all about how it is set up and more importantly who uses it that derives the value.

Happy Tracking
Alex
http://Www.linkedin.com David Sealey

SLAs and customer support would be two great paid for services. I think this would suit the requirements of many SMEs as well as enterprise level organisations.

I’d like to see the inclusion of some additional user experience tools such as more accurate click tracking (ala CrazyEgg)

David
http://www.parisoma.com/2011/04/the-future-of-analytics The Future of Analytics | pariSoma innovation loft. coworking and tech events.

[...] users are also arguing that Google should offer a paid version to offer new features and [...]
http://separateGAfromGoogle/Adwordsfavourtism sidney

GA is simply a product aimed at pushing Adwords on business. It excludes direct traffic where a referrer is present within 30 days previously which often makes Google the centre of the world. i believe it is only fair to other search providers if GA remove the overlap of the way it presents data as it is too skewed to favour its google search brother to the exclusion of other providers, simply because many people are lazy and do a brand search on google ratehr than enter the url. Both companies need to be separated to really promote competition.