Google Analytics is a great tool and will help you monitor your traffic effectively - it even shows you where on earth your users are coming from.
In my experience it is more precise than other similar services and provides nicer reports with many more details.
To get started go ahead and make an account here:
http://www.google.com/analytics/
You will have to click "Sign Up Now" and fill out the form.
Once you are done registering, Google will send an email to you and all you have to do is click a link to activate your account.
Then, log in to your Google Analytics account here:
http://www.google.com/analytics/
You will have to make a profile first, so click the "Sign Up" button:
In the next step fill in your website's or blog's URL without
http://, I wrote
www.hamidof.com
It will automatically fill the account name section for you, now click "Continue"
In the next step fill in your name and choose your country: (Phone number is optional)
Click "Continue" and check the box in the next step which means that you are agree with Google Analytics TOS (Terms Of Services)
Then click "Continue" and you will see a little HTML code which you have to copy and paste into your website's HTML code.
I recommend pasting this code in between your head tag.
Here is a simple HTML page:
HTML Code:
<html>
<head>
</head>
<body>
</body>
</html>
There are loads of HTML tags and text in between these tags.
So you will have to copy and paste the code in between <head> and </head> tag.
After that click "Continue" and you are all set.
This all it takes to set it up - after 2 or 3 days when Google Analytics collects enough data about your visitors, you can login and see detailed reports of your visitors.
Please don't hesitate to reply to this thread with your question if you have any problem with any of these steps.
I will write about how to use the control panel and read the stats in another thread soon