Most companies today use a multi-channel or omnichannel approach to their marketing strategy. This means brands are distributing content and adverts across various platforms, including social media, streaming services, email, and websites.
The multi-channel marketing approach poses a conundrum for marketers when it comes to determining which marketing activities, channels, and touchpoints are most effective — which is where marketing attribution comes in.
Marketing attribution is used to assign credit to the different touchpoints that play a role in each lead conversion. But with the number of digital media channels constantly growing, attribution has become more complex.
Even if your company is gaining loads of online traction, it’s still a challenge to figure out which exact audience interactions drive the most engagement and sales.
Having an in-depth understanding of marketing attribution can help you streamline your marketing efforts, gain insights into which channels you need to use more (and less), and ultimately drive more sales.
This article will cover the basics of marketing attribution and the different types of marketing attribution models available to marketing teams so you can decide which is best for your business.
What Questions Does Digital Marketing Attribution Tackle?
Marketing attribution is a scientific analysis of your marketing efforts to determine which strategies, tactics, content, and channels are responsible for driving sales.
Marketers use attribution to evaluate the role and effectiveness of each marketing touchpoint at different stages of the buyer’s journey. They can then optimize their marketing campaigns to better respond to customer needs, driving more sales and improving ROAS.
The objective of digital marketing attribution is fairly straightforward, but the process of assigning attribution soon becomes complex and can uncover several important questions, such as:
How far back should you aim to reconstruct attribution pathways?
Which interactions should you take into account?
Which should you exclude?
Are your ad networks providing you with reliable and complementary datasets?
Marketers use different attribution models to aggregate customer data and provide insights into the following questions:
- The messages a customer was exposed to and on which channels
- The touchpoint that had the greatest impact on their decision to buy
- The role of brand perception in lead conversion
- The most successful messaging sequences
- Which messaging got the best results
- The impact of external factors
Let’s take a look at some of the different attribution models, how they work, and their pros and cons.
An Overview of Position-Based Attribution Models
Digital marketing attribution essentially credits a particular marketing channel — or group of marketing channels — for a sale.
The most basic digital marketing attribution models are based on this simple premise and use various touchpoints in the customer’s engagement with a marketing strategy to decipher the role that each one plays in a conversion.
Platforms such as Google Analytics and WordPress use the following position-based attribution models:
- First-touch attribution: in this model, the sale is attributed to the first touchpoint — usually a piece of content or ad — that a customer interacts with. If your marketing initiative is focused on generating brand awareness and user acquisition, this single-touch attribution model might be a useful one to start with.
- Last-touch attribution: Similarly, this model prioritizes the last touchpoint as the basis for attribution. It provides insight into bottom-of-funnel activities by focusing on the point at which prospective customers actually convert.
- Last non-direct click: A non-direct click is one that comes from somewhere outside your website — for example, a website or social media platform where you’ve placed ads. If your marketing efforts are focused on programmatic digital ads that are served across multiple channels, this model will provide valuable insights into which platforms and ad placements drive the most sales.
But as any savvy marketer knows, the first and last touchpoints are only a small part of a bigger picture — the customer journey. Customers need to become familiar with your brand or product through a series of marketing activities that move them from top-of-funnel to bottom-of-funnel and, finally, to conversion.
It takes more than a single ad to make a prospect go from zero to 100, and these position-based attribution models don’t capture the full story of the customer journey. Fortunately, multi-touch attribution models exist that can provide a more detailed analysis of the success of your marketing ecosystem.
Multi-Touch Attribution Models for Digital Marketing
Multi-touch attribution models paint a more accurate picture of the funnel because they take more than one touchpoint into account. In these models, all touchpoints — whether it’s a piece of content or an ad — are taken into account and attributed a percentage of the conversion.
These are still not the most sophisticated models out there, but they’re a definite improvement in terms of accuracy compared to single-touch models. Let’s take a look at how they work.
- Linear attribution model: Here, attribution is distributed equally among each of the touchpoints the user interacts with before converting. Think of it as taking 100% of the conversion credit and averaging it across all interactions — simple but still multifaceted.
- U-shaped attribution model: This model combines the first-click and last-click models into something more nuanced. It recognizes that not all touchpoints have equal impact and weighs them accordingly, crediting the first and last touchpoints both get 40% each and splitting the remaining 20% equally across all the touchpoints in between.
- W-shaped model: This is similar to the U-shaped model but adds another core stage of the customer journey — the opportunity stage. Therefore, this model credits not only the first and last touches but also the opportunity creation touchpoint with 30% of the attribution each. The remaining 10% is then split across all other touchpoints.
- Time decay model: This model also weighs each marketing touchpoint according to its role in the sale. The touchpoints closest to the point of conversion are given more credit, assuming they had a greater impact on the path to purchase. Earlier engagements are attributed progressively less credit.
Algorithmic Digital Attribution Models
The most advanced attribution models use machine learning and data science to gather large amounts of attribution data and insights on the customer journey.
These models harness artificial intelligence and machine learning to accurately calculate the role each touchpoint plays in a sale.
They apply customized weightage that’s tailored to each touchpoint based on the specific context of a particular user and the particular marketing initiative to yield extremely precise insights.
However, they’re also expensive to implement and maintain and require a working knowledge of data science — as well as the investment in an AI-powered attribution tool that can negatively impact your marketing ROI.
Choosing Your Digital Marketing Attribution Strategy
Now that you’re familiar with the most common types of attribution strategy, you’ll need to decide which model is most suitable for your needs. It’s important to choose your digital marketing attribution strategy based on the circumstances of your business and the priorities of your marketing initiatives since different approaches will suit different businesses based on different needs.
Make sure you involve your product development and marketing teams in the process to ensure you’re always aligned on the ultimate objective of your marketing efforts. Once you pick an attribution model, stick with it for a while to gain critical insights and attribution analytics over time. This will allow you to evaluate whether this is the best model for your business or whether it requires improvements.
Let Us Help You with Your Marketing Attribution
Attribution is essential in digital marketing as it can help you optimize your marketing campaigns to make them hyper-targeted, highly effective, and yield greater ROAS.
Since digital marketing attribution involves specialist knowledge of how to aggregate and analyze attribution data, many businesses prefer to partner with a specialist digital advertising agency like Grapeseed Media.
Here at Grapeseed, we deliver expertly-crafted programmatic ad campaigns that leverage AI algorithms to deliver fully optimized ads and provide key attribution metrics and insights. Get in touch to learn more about how we can help you grow your business.