What are attribution models?
Although you might want to believe that the customer’s purchasing process is simple, odds are that it’s not. There are numerous methods for customers to discover and interact with your brand, services, and goods in the digital age. Further down the sales funnel, their engagement and progression become much more complicated. The user journey can be managed with precise touchpoints created to guide the client toward a desired outcome, such as a conversion, with careful and strategic planning. The term “attribution model” refers to this strategy plan.
Understanding attribution is crucial for marketers who want to improve their campaigns because the appropriate attribution model may significantly impact a company’s bottom line.
How do models of attribution function?
In order to analyze and give credit for a marketing activity that occurs at certain stages of the customer journey before they arrive at their final destination—conversion—marketers use an approach known as “attribution modeling.” It covers the full procedure, from looking up a product online to making the actual purchase. The analysis of every step along the process and how each touchpoint affected the conversion is what matters most.
Which touch points are effective and which ones aren’t can be determined with the aid of attribution modeling. With this in mind, you may then make tweaks and adjustments to make sure you’re receiving the finest outcomes possible all around.
To analyze how marketing interactions affect the whole sales funnel, use multi-touch modeling to allocate credit across a variety of touch points.
The importance of attribution models in digital marketing
How can you be sure which channel led to a sale if your marketing efforts involve a variety of touch points, such as PPC keywords, landing sites, SEO, and display ads? It’s possible that a customer will engage with some aspects of your campaign more frequently than others. Attribution modeling makes it possible to see the client journey clearly from the beginning to the final purchase. This implies that you can adjust your strategy in light of the efficacy of each medium, producing superior outcomes and increasing sales. For instance, it’s possible that one of your landing pages is producing a lot of leads while your social media advertising aren’t getting very much traction. With the data in front of you, you might allocate more funds to landing page content to build on the success and spend less on unsuccessful advertisements.
What advantages does marketing attribution offer?
Attribution modeling has numerous advantages, including:
- Making the most of your marketing budget
- Boosting your ROI
- Increasing your individualization
- Improving the way you build your products
- Maximizing creative resources
What distinguishes single-touch models from multi-touch devices?
Although there are numerous attribution models in use by companies around the world, they are virtually invariably either single-touch or multi-touch models. There isn’t a single model that is infallibly correct; instead, you must select your model in accordance with the marketing goals of your business and the way your campaigns use various channels.
A single-touch model, as you can probably infer from the name, attributes a customer’s conversion to just one touchpoint. An example of a single-touch model is
Initial interaction credit: The initial point of contact that brings a user into contact with your company receives full credit for conversions.
Attribution based on last engagement: The final interaction a user has before converting receives full credit for the conversion.
Because the modern customer journey is so fragmented, the majority of profitable businesses will use a multi-touch strategy. Due to the abundance of clever marketing strategies used by companies in the market, firms have recently had to work harder to win over customers. As a result, companies are compelled to use additional touch points to direct customers through the funnel. Businesses frequently use a multi-touch attribution model to evaluate the effectiveness of each contact point. A few of the most well-liked multi-touch devices are:
Linear attribution: All touchpoints share equally in the credit for the conversion.
Time decay: The majority of the credit is given to interactions that occur near to the conversion.
Position-based (U-shaped): Most of the credit goes to the initial touchpoint and the qualified lead touchpoint, with the remaining percentage being divided among the sandwiched touchpoints.
W-shaped: The first, last, and qualified lead touchpoints each receive an equal share of the credit.
Z-shape: The remaining credit is distributed equally among the remaining touchpoints, with the remaining 4 touchpoints receiving 22.5% of the credit.
What are some attribution modeling blunders and difficulties to watch out for?
You need to make sure that your attribution modeling is done appropriately and that you are measuring all of the appropriate components. You should watch out for the following:
- Bias based on correlation
- Discounted Inventory Bias
- Market-Based Bias
- Bias in digital signals
- Behavior & Brand
- Signal for a missing message
- Not taking into account offline touchpoints (foot traffic, point of sales surveys, call tracking)
Which attribution model ought I apply to my company?
For every type of business, there is no general guideline. The complexity of your client journey will determine the best attribution strategy for your company. Consider using a single-touchpoint strategy if your business has few options for reaching your customers.
However, if your company employs a variety of strategies, including an SMS gateway, social media, Google Ads, email automation, etc., you may require a more comprehensive multi-touch attribution model.
Examining a user path can help us understand how attribution modeling might be used.
When Jonathan saw an advertisement for your company’s product, his quest began. He engaged with your company on social media after clicking the advertisement. He noticed something, pondered about it for a few days, and then naturally searched for your business on Google. He later joined up for your mailing list, watched a video on your website, and received an email with a coupon code. He made his decision to buy at this point.
A marketer can evaluate the success of each touchpoint that led Jonathan to convert using attribution modeling.
Depending on whatever model you wanted to use, you would give credit to either the first touchpoint or the last touchpoint if you wanted to apply a single-touch model. But in this instance, you wouldn’t get a whole view of the consumer purchasing process if you only included the first or last interaction. But if you used a multi-touch attribution approach, you could additionally credit the other touchpoints that were essential in this specific conversion path.