I’m a big fan of

Google Analytics

and consider it to be one of the best free analytics tools for the average webmaster.

One of its most useful features is the ability to set “goals” and track how well they’re being achieved.

For instance, if one of the aims of your website is to encourage users to take a tour of your service and then to sign up, Google Analytics has the ability to track this.

Creating and configuring goals is so easy that there’s really no excuse not to take advantage of this functionality.

To set up a goal in Analytics, from the Dashboard of your Google Analytics account, click on the “Edit” link in the Settings column of the website the goal should be applied to.

The first step in setting up a goal is to define the URL of the page that is reached when the goal is achieved (i.e. the signup confirmation page), as seen below.

Optionally, you can define a “funnel” which represents the path that a user must take for the goal to be considered achieved. This is especially useful if you are trying to “lead” a user to conversion in a specific fashion. Here’s an example.

That’s it! Once a goal has been set up, Google Analytics will track your visitors as it normally does and analyze the data to determine whether or not your goals are being achieved.

You can access this data by clicking on the “Goals” link from the Google Analytics left navigation.

Beyond tracking how well your website is achieving your goals, Google Analytics will help you visualize your funnels and track your abandonment rates.

This can be immensely valuable in helping you determine what adjustments you can make to your website to boost conversions.

In my post last week, ‘5 places where e-business owners can find cost savings;, I mentioned that “There is a lot of scope to track ROI and optimize campaigns to ensure that budgets are getting the most bang for the buck, and now is the perfect time to take advantage of it.”

The same is true when it comes to tracking and optimizing your website. If you’re using Google Analytics, now is the perfect time to take advantage of its goal-tracking functionality to make sure your website is delivering conversions in the fashion you want it to.