What Is Marketing Attribution? A Guide To Understanding The Benefits
The average customer uses a variety of channels to communicate with companies; therefore, marketers today need to rely on multi-channel strategies for their campaigns. The landscape of digital marketing has become more fragmented than ever before. Marketers everywhere are looking for ways to optimize their marketing mix to get the most out of their investment. So, what is marketing attribution? Below, the definition and benefit are laid out to explain why marketing attribution is essential to marketing success.
What Is Marketing Attribution?
Marketing Attribution is the process of analyzing your marketing tactics to determine which are contributing to a sale. In other words, it is the evaluation of touchpoints that consumers encounter along their purchase journey. Marketing attribution aims to diagnose which messages and channels impacted the consumer’s decision-making to produce a conversion. Most of the time, multiple channels are responsible for the buying decision.
Since there are many touchpoints in the customer journey, marketing roles are becoming more complex, which is why marketing attribution models are becoming more frequently used. There are many models, such as lift studies, multi-touch attribution, time decay, etc. These models provide insights into where the consumer interacts with the brand, helping marketers customize their campaigns to reach specific audiences.
Why Marketing Attribution is Beneficial
Understanding the consumer touchpoints is beneficial to optimize your marketing campaign. Models, when used effectively, can bring multiple benefits.
Optimize Marketing Costs
Models can show where the most engagement occurs at specific touchpoints, giving marketers insight into where to spend their money. This allows the budget to be adjusted and determines where to spend to optimize each campaign. When marketers can determine where to reach consumers at the right time, conversions will increase, leading to a higher return on investment.
When marketers understand which consumers are interacting with specific channels, they can update their campaign to target these consumers at the right time. Models provide a better understanding of the customer’s needs and desires, allowing marketers to make their campaigns more effective with personalization.
Marketing Attribution Models
Marketing attribution models range from single-factor to advanced. Some models are more complex than others, each with pros and cons.
Single-source Marketing Attribution Models
To assign the credit, single source attribution models determine a single touchpoint, typically the first-touch or last-touch. These models can be beneficial; however, they fail to determine key insights on other channels that consumers may have interacted with on their conversion journey.
- First-touch Attribution: When using this model, the credit for the conversion is assigned to the first channel the customer engaged with. This model alters the perceived effectiveness of the other touchpoints because it doesn’t account for the other channels the consumer may have interacted with.
- Last-touch Attribution: Opposite of the first-point attribution, the last-touch attribution assigns the credit to the last touchpoint the consumer engaged with before the conversion. Last-touch attribution also doesn’t account for the other channels the consumer may have used to complete their journey to the final sale.
Multi-source Marketing Attribution Models
Unlike a single-source model, multi-source attribution gives credit to each channel the consumer interacts with, leading to the final conversion. However, this model fails to account for the amount of credit that each channel deserves.
- Linear: Linear models give an equal amount of credit to each touchpoint.
- Time decay: The time decay model assigns credit to the touchpoints used most recently, assuming the earlier touchpoints may not have been as impactful
- U-shaped: The U-shape model looks like a U since the credit is assigned to the first touchpoint and the lead creation. The rest of the credit is given to the middle touchpoints.
- W-Shaped- similar to the U-shaped model, the W-shaped model gives credit to the first touch and the lead conversion. However, the model also assigns equal credit to the opportunity stage, with the remaining credit given to other touchpoints.
With advancing marketing technologies, and multiple new channels for consumers to explore, marketing attribution has become more crucial for marketers to achieve their campaign goals. Understanding where sales are coming from and the journey the consumer took to reach the final transaction is essential. This information can be beneficial, allowing marketers to optimize their campaigns and understand which touchpoints are effective. Lead Revealer is a tool that will enable you to understand the consumer journey. The tool reveals where leads are coming from and how they interact with your marketing efforts. Visit our website to learn more.