Google Analytics gives you the option of defining specific conversion goals to help gauge the success of your marketing efforts. Conversion goals can consist of things like newsletter sign-ups, catalog requests, product purchases, or filling out a contact form. Creating conversion goals, and the conversion funnels that may accompany them, is as simple as entering the URLs of the pages in your goal settings.
Setting conversion goals is a very important part of the analytics process and is especially useful because specific events can be tracked to the source of the visitor. Tracking the source of your visitor enables you to see where your highest quality traffic is originating from, and then target that source more aggressively. For example, if you discover that half of all the visitors to your Web site that come from example.com end up requesting a catalog of your products, you should try to receive more traffic from example.com.
Currently, you can have up to four conversion goals for each Web site profile in your Google Analytics account. Each goal can also have a designated funnel, or path, to the ending goal page. Setting up a funnel allows you to see where your visitors abandon your conversion goal cycle. This feature helps you find potential problem areas of your Web site. For example, if 70 percent of your visitors get to Step 3 of a goal funnel such as a contact form and then leave your site, you should look at the design and content of that particular page and attempt to find out why so many visitors are exiting at that point. This metric can prove to be invaluable in locating and addressing issues within your Web site and goal cycle.
At this time, you can have up to four goals for each Web site profile in your Google Analytics account. You can get around this limit by creating an additional profile for the same Web site. This is done by clicking Add a Web Site Profile from the Analytics Settings page, and then selecting Add a Profile for an Existing Domain. You then select the domain from the drop-down menu, and enter a new name for the additional profile. You can then set up four additional conversion goals in this new Web site profile. This process can be repeated as many times as needed.
When creating new goals, you can set a monetary value for each goal conversion. For example, if each newsletter subscriber at your Web site is worth an average of $1.00, you can set this amount as the value of the goal. Your Analytics reports then show this value for each conversion, and provide you with an accurate snapshot of the general worth of your traffic from any given source.
Note that because Google Analytics does not provide real-time data, you must make your decisions based on daily, weekly, or monthly historical trends and not hourly changes or fluctuations.