Why eTailers Should Ignore Alexa Rankings

by Geoff Hineman

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There are a number of different ways to monitor a website's effectiveness. Indeed, there is no shortage of data mining tools available today. One of the more popular tools available is Alexa. In combination with a variety of other tools, Alexa data can be helpful. As a standalone tool, however, eTailers really need to take Alexa data with a grain of salt. In this article, we will look at some of the reasons why Alexa scores really shouldn't matter as part of your online marketing strategy, namely: sample size, ranking calculations, and variability.

Alexa Sample Size

The first thing you need to keep in mind is that Alexa data is gathered from only people who are using the Alexa toolbar, which represents a very small sample size of actual internet users. Further, the Alexa toolbar excludes mobile devices, which continue to increase as a medium of accessing the internet. To further compound the matter, some antivirus programs sound the alarm when the Alexa toolbar is installed. You also have to assume that a decent sample of users with the Alexa toolbar installed are likely marketers whose search habits are not reflective of the public at large.

Alexa Ranking Factors

Alexa rankings are based on very few known factors, which clearly do not benefit eTailers. More directly, Alexa rankings are determined by combining the number of site visitors and the average page views per visit. In some respects, this can penalize an efficient site. For instance, if customers come to a site and find what they are looking for right away, they will have fewer page views than a site that makes its customers hunt for the products they need. One of the core strategies of eCommerce is to get your customers to the checkout as quickly as possible. This is done through calculated site design that gets customer what they need quickly. The end result is often increased revenue, which is better than increased Alexa rankings every time.

Alexa Rankings Are Dynamic

Alexa rankings are not just determined by what your site may be doing to improve business, but what millions of other sites are also doing (or not doing). This means your site is actually being ranked against sites that have absolutely nothing to do with you or your vertical; so it's a very apples to oranges comparison. Alexa even notes on its own site that their numbers are rough estimates.

Metrics You Can Use

At Lett Direct, we look at revenue as the defining measure of success. If revenue is increasing, we continue to stay the course, often regardless of what other metrics are showing. If revenue starts to slip, then we delve deeper into various metrics, such as traffic, bounce rates and page views to find a culprit. Online marketing for eTailers is about keeping the horse in front of the cart. Focus on revenue first and work to improve that. Don't base your strategy, in any part, on improving other metrics unless they are directly contributing to increased revenue. Always remember: You can't put metrics in the bank.