What is Marketing Attribution?

Marketing Attribution

If you are working on a marketing campaign, you need to know if that initiative made you any money. Sometimes the answer isn’t very clear.

That’s where marketing attribution comes in.

Marketing attribution reveals:

  • Why your client bought your brand.
  • When did they first connect with your company?
  • How long did it take between initial contact  and buying for the first time?

If you released a new product last month and suddenly see more customers buying after a few social media campaigns and email blasts, you’ll want to know which campaign was the most effective at driving sales. Do Facebook video ads and Google display ads count if a buyer then searches for your business on a search bar?

What Is Attribution In Marketing?

There are many ways to analyze your marketing data and determine when that email click or social media like was connected to helping you grow your revenue. Here are some of the most popular models.

Touch Attribution

This is a simple marketing attribution model. In first touch attribution, full credit goes to what first drove a visitor to your website for the first time, marking the beginning of the journey between the customer and your business. In last touch attribution, it’s the final interaction with a customer before they become a paying customer, that counts.

While both models are straightforward and easy to implement, it can be too simple for businesses looking to glean more knowledge from their data.

Linear Model

This model divides all touchpoints evenly, meaning, every interaction a customer had with your business is counted equally as having contributed to conversion. It gives you a bigger picture than a first or last touch marketing attribution model does.

While this model takes into account everything that leads to a conversion, it can be difficult to determine how much credit each touchpoint should get. In a linear model, a Facebook like, email signup, and attending a conference would all get the same value, which isn’t accurate for all business models.

Time Decay Model

This model gives the most credit to the reason for the conversion, allowing marketers to really analyze what drove a customer to buy. The closer a point occurred before conversion, the more credit it gets.

Just like the other models, it also has a downside. The time decay model doesn’t give credit to when a customer first became interested in your business, which can be invaluable information if you’re trying to get new clients.

Position-based Model

There are two different marketing attribution methods under the position-based model, which attempts to score customer engagements by impact.

  • U-Shaped: This model counts the first touch and lead conversion as 40% responsible for the lead, leaving the other 20% divided in-between.
  • W-Shaped: The same as the U-Shaped model, but it also includes the opportunity stage as a core component, leading towards conversion.

The main focus of this model is where customers find you and what made them buy. It’s a great way to analyze your data if both the first and last touchpoint are the most important. However, this model undervalues the sales channel and can fail to give credit in the middle, such as a sales call or watching a webinar.

Algorithm or Custom Model

This is the most advanced marketing attribution model, as it is customized for each business. Each touchpoint of a customer’s journey is assigned differently, depending on how important the business believes it to be. It can also be calculated manually or used with machine learning to get fresh data and refine the model on a live basis.

As this is the most complicated model, it’s also the most difficult to set up and the most expensive. In some cases, it even requires the expertise of a data scientist.

Common Mistakes to Avoid

When you are working with a marketing attribution model, there are many common mistakes that you should avoid and make sure you are correctly identifying the success of your marketing attribution campaigns.

Things to avoid include:

  • Correlation-based bias: When it looks like one event caused another when it was in fact unrelated.
  • In-market bias: When the customer was already in the market and would have bought the product regardless of the ad.
  • Cheap inventory bias: When lower-cost media appears to have contributed to the conversation rate of customers when it didn’t have a role at all.
  • Digital signal bias: When models do not factor in the relationship between online activity and offline sales.

Which Model Should You Use?

There are many factors that go into attribution marketing and each one has it’s benefits and downsides. No one model fits everyone. It depends on what your ultimate goal is.

Single-touch models are better suited towards smaller businesses with a fast turnaround, while custom or position-based models are better for B2B marketing teams that need more in-depth research on longer sales cycles.

The best way forward is to figure out how marketing attribution can work to your advantage. Find out what insights they give you and leverage on the touchpoints that are the most valuable for your business.

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