Marketing attribution refers to identifying the specific actions someone takes to learn about your brand and buy your product or service. It's how marketers assess the value of the various channels or events that led to the conversion.
Models for marketing attribution have been used for many decades, but as the needs of customers have changed and companies have undergone digital transformations, marketing attribution has evolved.
Today, sales are made or lost with a click, so it stands to reason that attribution models need to accommodate the nuances of the digital world. What worked 30 years ago may fall short today, but that doesn’t mean the tactics of the pre-internet era are no longer useful.
Keep reading for a brief history of marketing attribution, different models that are used today, and where it may be heading.
Back in the 1950s is where the roots of marketing mix models (MMMs) can be found. This approach gained popularity into the 80s, as it included cross-channel coverage of all media types that were used to encourage conversions.
MMMs were a useful tool, partially due to the lack of viable alternatives. Today, these older attribution models lag behind in a digital world, and marketers who still rely on them are missing out on valuable information and insights.
MMMs are much too slow for the online world, often providing results weeks after a campaign has been completed, rather than during one. They also do a poor job of measuring brand equity, often leading to over-spending on activities in the lower end of the funnel and under-spending when it comes to brand development for those that need more motivation to take action. These and other shortcomings make the MMM model ineffective, especially for organizations that have yet to make kickstart digital transformation.
Luckily, the transition to the digital world has provided marketers with tools and techniques that have revitalized marketing attribution models, making it possible to track each step along the customer journey. It's not often that a customer will simply type in a web address and make a purchase, which is why a range of different attribution models are used to ensure multi-channel marketing success.
Your business can work with different marketing attribution models, depending on goals, business model, resources, and more. There are several options that can be used such as:
Single Source Attribution
Single source marketing attribution assigns the credit for conversions to one touchpoint, which is typically the first or the last touch. With first touch attribution, all of the credit goes to the very first channel your lead engaged with, whether it was an online ad, landing page or downloaded resource.
This type of attribution is easy to implement, but it fails to account for any interactions the customer may have with your company after that initial first contact, which will obviously change the perceived value of any other channel. Last touch attribution gives credit to the final touchpoint before the sale, and while it is also easy to track, it has the same issues as first touch attribution, as it doesn’t recognize any other channels that may have contributed.
With multi-source or multi-touch attribution, each channel that contributes to the final sale is given its due credit. This method gives a much more complete view of the sales process, but it still doesn't account for how much each channel actually contributed to the final sale. An example of multi-source attribution would be an initial PPC ad that leads to a landing page, then an email form in exchange for a free ebook, a webinar, and then the final sale.
There are 6 multi-source attribution models you can use in your digital marketing. They include:
Choosing which marketing attribution model to use can be a hotly debated topic within any marketing department. The success of a particular model depends on the values, beliefs, budget, and size of the company, the industry, which tools are used, and how far along you are in your digital transformation.
Trial and error and testing can play a significant role in ultimately deciding on a marketing attribution model, as you can compare and contrast, giving credit where it should go for the best possible outcome. It's important to keep in mind that budget will be allocated to those channels that have the highest perceived value, so it makes sense to try and get it right.
For larger organizations, choosing the right model may require the participation of marketing, sales, IT, and finance. Naturally, this means that sales and marketing need to work together and communicate throughout the process to optimize each campaign and get the best possible results. CRM will also become a factor, as marketing touchpoints made to existing contacts will be measured.
Since no marketing attribution model is foolproof, there is no easy answer or formula to use to pick the model that will work best for you. However, you can take steps ahead of time to improve your chances of making the right choice. Here are some tips to follow:
Create a Customer Journey Roadmap
When you map out the various touchpoints, channels, and interactions that will dictate a specific campaign, you will have a clearer picture of what to expect. Luckily, you can use analytics to track data for each step to help you determine which ones have the highest value.
Focus on the Quality of Leads
Lead quality needs to be a priority when creating your roadmap and subsequent campaigns. If you focus on the Lifetime Value of each customer (LTV) and not just on the initial sale, it will help you decide on an attribution model that will work. Keep your objectives in mind from the start and don’t lose sight of what you want to accomplish as the process progresses.
Change Is Not a Bad Word
Part of being successful in the online marketing world is the ability and willingness to change things up when the data justifies it. Testing is a natural part of digital marketing, and it is a key to finding success with your attribution models. Your model should change and evolve as the business changes, and every department needs to be on board for the greater good.
While multi-channel marketing attribution has been the name of the game in the past and in the present, some experts predict changes that will make the process even more effective.
Automatic Ad Spend Redistribution
Attribution systems that automate themselves may be a reality in the not-too-distant future. The idea is that attribution tools will redistribute your ad budget automatically in short time intervals, so your marketing ROI is always optimized. That will free up time for the team members who usually perform those tasks, as they will only have to read reports of what the system has implemented.
Product Offerings Tailored to Buying History
Personalization is a big thing in modern digital marketing, and one exciting attribution tool will be individualized product offerings based on previous viewing and purchase activity. As an example, if you buy a product that you only need one of, like a barbecue, you won't be shown barbecues again but complementary products. The customer journey will likely be longer with this type of tool, but it will also be more profitable.
No matter where your company is in its digital transformation, choosing a marketing attribution model that works is crucial.