Senior Management would say:

Senior Management's response:
•    Investing in web analytics and analytics, in general, is discretionary. “I don't need analytics to sell my products and services. I want to sell more and that means more promotion and advertisement. I can assess the results and performance later.”
•    Cutting down on analytics is a harmless decision. “Analytics is the first expense I can cut down on without affecting my business. If I use less people in the call centre, I will affect the customer service. If I use fewer resources in the supply chain, then the service level might be affected. If I use less resources/money in product development, then other competitors will innovate and win in the new markets.”

Web analytics Advocate's response:

"Every dollar that a marketer has, I think everyone has in every organization is under pressure right now and certainly marketing spend is where CFOs like to look and see if they can cut. But, what we've seen with our customers is their online channels are the ones that are performing the best. Their online channels are the ones that are giving the most direct impact within that quarter that spend is also taking place.

In terms of the way that they think about Omniture, even if they cut let's say 10% of their marketing spend, they're going to use us to a) identify the 10% they're going to cut and b) use us to optimize the other 90% to try to get back up to the same results as they had with the 100% the year before. These kinds of times actually drive usage of our product.

When things are good it's a lot easier when you want more sales just to throw more money at the top of funnel and to generate more leads and go through the process. When things get bad people try to focus on everyone that's already coming to the store, what can we do to keep them more attracted/happy? What can we do to get them to look at other things? What can we do to get them to read additional articles? All of those behaviors drive uses of our product."
See full Q&A Session by Josh James, CEO of Omniture.In my opinion, both sides have their merits.

Using web analytics to optimize marketing spend should already be the case, but most companies (even the ones that spend loads of money in web analytics) don't do it. It's my firm belief that decisions, particularly marketing decisions, should be based on some kind of facts and data rather than intuition.

On the other hand senior management are right that analytics is discretionary spending. It is very easy to cut down on report and analysis especially when their contribution to added value is not obvious. As a matter of fact, most companies use web analytics reports and not web analytics to support/help/influence decision making.

We know that the economy sucks but we want to perform well and be the winners in the battle.

What can we do??

Know our customer needs

During a busy schedule, we're likely to forget that we work because our customers choose us for our products and services. They are the ultimate judges and we should make sure that we do everything that is possible to satisfy them. During current tough times, consumer spending is directed towards  products and services that have good value for money. We have to innovate in the price and pricing structure field.

How can we lower our prices?
Do we offer many bells and whistles? Are they really necessary to our customers?
Are we sure that all the products and services have added value to our clients?
Web Analysts should know/discover customer needs and try to align the business to satisfy those needs. It is not that easy, not even in small companies.

Web analytics should Add Value and not be report monkeys

We all know the Pareto law 80/20. I think that in web analytics, 90/10 applies. When you spend 10% of your real analysis you transfer 90% of your value to an organization. On the other hand, most analysts spend 90% of their time in reporting, which corresponds to 10% only of the value of their analysis.

Isn't it high time that we asked ourselves what the purpose of reporting is? Do we use the reporting to support and help business make decisions? If not, then why do we produce these reports? Let's Do something usual and stop produce them.
Our analysis should talk about revenues not numbers and we should invite customers voice in our analysis.
There are many other ways to be the winner is this recession and you can find loads of advice.

However, I truly believe that we (I guess, most of us) acted irrationally in the boom period. Why should we act irrationally in the bust, too? As Adroulakis says, crisis is a war without guns. This crisis provides us opportunities to innovate, to stop doing what we've always thought was correct, to start thinking more about our existing customers and return back to basics. "Money is not everything in Life. They are not even enough".

Related  links:

Q3 2008 Earnings Call transcript 2008

Web Analytics in the time of recession

Here the fantastic Eric Peterson writes about web analytics in recession. Eric is the best presenter I have seen in web analytics