When you’re paying for advertising and marketing, knowing the return on your investment is critical. That’s where the term marketing attribution becomes relevant.
It’s an important thing to understand, particularly if you’re relying on multi-channel strategies online and offline for your marketing campaigns.
With that in mind, the following are key things to know about marketing attribution and how it should fit into your overall marketing and advertising plans and strategies.
Marketing attribution refers to the analytics of figuring out which of your marketing tactics are leading to conversions or sales.
To go into a more in-depth definition, it’s about the evaluation of marketing touchpoints that your consumer is encountering on their way to making a purchase. You want to be able to discern which messages and channels had the most impact on conversions or moving someone along in their buying journey.
The insights you get from using marketing attribution models can help you customize your campaigns and improve your ROI.
Marketing attribution is important because, again, it helps you put your resources where they’re most effective. You can stop spending time on things that don’t work. With marketing attribution, advanced analytics are needed, and then that data should be broken down into actionable and understandable insights.
What Are the Benefits of Marketing Attribution?
Some of the benefits of marketing attribution have been briefly touched on above, but include:
Optimization of spending:
While it can be time-consuming to gather the data for marketing attribution, it’s likely going to be well worth it. You can see insights as far as how your marketing dollars are currently being spent versus how they should be spent. You can adjust your budgeting and spending in a data-driven way, rather than guessing.
Attribution is going to help create tailored marketing campaigns reaching the right customers at the right time, so you’ll see more conversions and a higher ROI on your marketing.
In this advanced digital marketing era, customers expect personalization in messaging, and attribution can help you deliver. You can learn more about customer preferences throughout the journey.
The analytics you gather as part of attribution efforts aren’t just applicable to marketing. You can also use them for product development. You’ll be able to more clearly see the needs and interests of consumers and fill a void when it exists.
Marketing Attribution Models
You’ll often hear the term marketing attribution model. This is a process that uses assigned values for campaigns. It requires statistical analysis. Regardless of the specifics of an attribution model, it should achieve a few things.
It needs to show the messages a consumer saw and what channels they saw them on. It needs to identify the most effective touchpoint, the role of brand perception, and how message sequencing affected them. Then, the model needs to identify the messaging that most resonated and how external factors might have played a role.
Examples of models include:
- Single-touch model: The single-touch attribution model is one where the assumption is that a consumer conversion came after an encounter with the first ad.
- Last-touch model: In this model, the credit is given to the final touchpoint interaction without consideration for other steps in the engagement process.
- Multi-touch model: The multi-touch model is more comprehensive, and it assesses all encountered touchpoints.
With the multi-touch model, every channel is given credit for a contribution to the conversion.
There are six sub-models that fall into the larger category of the multi-touch model.
There’s the linear model, which is the simplest. It gives equal weight and credit to all of the touchpoints encountered along the way.
- Time decay is one where more credit is given to the touchpoints that were most recent compared to the ones that were earlier in the process.
- A U-shaped model gives the first touch and lead creation credit and any between those.
- W-shaped includes an additional touchpoint when compared to the U model, which is called opportunity creation.
- The full path is the W-shaped model plus the close.
- Then, you can develop a custom attribution model as well.
- Finally, touchpoints in each of the above models can include any event that is thought to move a customer toward an expected outcome.
Examples of touchpoints can include organic search, paid search, organic and paid social, email marketing, and direct traffic. There are also offline touchpoints such as TV and radio spend and magazines.
Webinars and sales meetings, as well as events and tradeshows, fall into the category of CRM touchpoints.