The 10/90 Rule

Many years ago, Avinash Kaushik created a general rule for the implementation of web analytics called the 10/90 rule. This rule stated that for every 10 dollars you are paying your web analytics vendor (WebTrends, Omniture, CoreMetrics, etc), you need to be investing an additional 90 dollars in analysts/intelligent resources to extract value from that data. As you can probably imagine, most people saw this rule as either a massive exaggeration or simply unrealistic. But the logic behind the 10/90 rule is really very sound which is most likely the reason why it has been implemented in countless real world businesses in recent years. First of all, web analytics tools, like WebTrends or Google Analytics, are incredible at providing you with
But they cannot tell you the “why.” The “why” is made up of the insights that drive successful business decisions that can set your business apart from your competitors. This “why” can only be determined for you by your expert team of analysts that you chose so wisely to invest your money in. As Gibson (2013) puts it, “your Web analytics tool is only as powerful as the person using it.” Additionally, with the introduction of free web analytic software, such as google analytics, we have entered a world where data, and massive amounts of it, is essentially free. But what is still not free, is using this data to identify specific business decisions and actions business leaders can act on based on rigorous and detailed analysis. Which is why Kaushik’s 10/90 rule makes a lot of sense when you realize that it is actionable insights and not data that your company should really be paying for. Chaffey (2015) provides a personal example in his article on the 10/90 rule where he illustrates this point: “In every company, every leader wants a dashboard. “Get me a summary of the business performance. Decisions shall be made!” Analysts scurry around and an intense burst of data, manifested as tables and charts, is presented on a vanilla-scented piece of