Knowing where people are coming from when they visit your site, along with what pages they visit, how long they stay on your site, and other relevant information, should form an important part of your overall site strategy. It amazes me how many people overlook this simple, but obvious requirement. How can you make improvements to your site if you have no idea how the site is being used? How can you determine what promotion strategies are working and which aren’t? Installing a package that collects, collates and analyzes your web site traffic should be an essential part of your ongoing site improvement decisions. It forms the basis of you understanding what is working on your site and what isn’t. It also provides an excellent means for determining what ads, backlinks, articles, blogs and so forth are bringing traffic to the site. If you are paying for an ad that only gives you a few hits a month, it’s time to jettison that ad. There are a number of packages available to you that work with both ASP and PHP. Others are script independent. Some of these are free, some aren’t. My personal favorite is Traffic Facts, but there are many others. There is a small fee for this product, but in my opinion it is worth every penny. You can also check places such as aspin.com or hotscripts.com for ASP and PHP scripts. If you were running a traditional “bricks and mortar” business, you would want to have some understanding of who was coming into your business, and more importantly, who isn’t. You would also want to know what ads and other promotional avenues you are paying for were actually working. Running an online business is no different, and in many ways, it’s even more crucial.Your site statistics will tell you what sites your potential customers are coming from. This would include ads you’ve placed online, email lists, traffic exchanges, backlinks from other sites, and so on. If you are paying, say, $50 a month for an ad on a particular site, it would be highly beneficial to know how many people are actually visiting your site from there. If your site statistics tell you that you are only receiving 5-10 visits per month from that site, you might want to reconsider where you spend that $50.Using two-way backlinks from other sites, as offered by link exchanges, can be useful. But are you getting return visits from all of those mutual links. Why would you keep a link on your site to another site if you are only receiving a handful of visits in return. A good statistics package will help you determine what sites are useful for you to exchange links with, and which aren’t. A good statistics package will also tell you whether potential customers are just coming to your site and then leaving from your homepage, or if they are drilling down further into your site. Having people visit your site is meaningless if they aren’t following the links to your sales pages. This can be particularily important if you are paying to use facilities such as traffic exchanges. The TEs will get you a boatload of “hits”, but those hits don’t mean a thing if they aren’t converting to sales.