[Free Takeaway Included – Must-Use Analytical Techniques Across the Customer Journey]
A customer can have hundreds of interactions with a brand across multiple channels and screens before making a single purchase. The average customer uses around 10 channels to communicate with companies, which means the digital marketing landscape is more fragmented than ever.
While it’s the final landing page in the customer’s journey that elicits buyers to take action, what about all the social posts, site pages and other content that also influence their decision to buy? All these interactions also play a pivotal role in moving the prospect towards the path to purchase.
Marketers need to have visibility into the composite journey of the customer and allocate resources based on their purchase path in order to maximize ROI.
However, an increasingly complex and non-linear buyer’s journey makes it challenging for brands to gain a comprehensive outlook.
Running reports in isolation such as web traffic or email open rates will reveal only part of the picture. Unless you know how each touchpoint moves the needle of engagement, these reports are just vanity metrics.
This means you need a more sophisticated approach to measure what channels and assets are maximizing sales opportunities. Understanding how consumers traverse across channels in their purchase journeys is crucial—and that's where digital marketing attribution comes in.
What is Marketing Attribution?
In essence, marketing attribution is the analytical science of assigning credit to the various touchpoints or a set of actions in the conversion path. It helps marketers understand trends and how prospects move through the path to purchase.
The goal of attribution is to identify which channels or messages had the greatest impact on the customers’ progression towards sales. As a result of the insights provided by marketing attribution models, marketers can adapt and tailor their approaches to meet their business goals, thus improving marketing ROI.
Understanding the Different Types of Marketing Attribution Models
Not all page views or marketing channels can be treated equally when it comes to conversions. Ingesting data from all the interactions across the customer’s journey is only half the magic; the other half is the ability to apply different attribution models to extract actionable insights.
Here are some marketing attribution models that can be used to assign credit to each channel and weigh the impact of each on the company’s bottom line:
1. First-Touch Attribution
Also known as first-click, this model assigns credit to the very first interaction that originally drove a visitor to your site. This model emphasizes top-of-funnel marketing efforts and is a simple way to know what attracts people to your brand. While it is easy to implement by simply tagging the lead source that is attributed to sales; it fails to take into account subsequent interactions after the initial touchpoint.
2. Last-Touch Attribution
Most businesses attribute credit to the closing touchpoint of sales, without taking into consideration prior engagements or events in the customer’s journey. In practice, this can include a final pitch deck, sales call or paid ad links that lead to conversions. This will identify the value of actions taken at the bottom of the sales funnel.
This simplest multi-touch attribution model captures each touchpoint leading to purchase. It weighs each of these interactions equally, giving each message and engagement point the same amount of credit for driving conversion. It can serve as a useful baseline report when getting started with marketing attribution to assess how contacts interact with brand assets before sales closure.
Unlike the linear model, this multi-touch method ranks each touchpoint differently, emphasizing the top half of the sales funnel as more impactful than others on the path of purchase. Particularly, both the first-touch and lead creation points are assigned the topmost credit with 40% each. Then it distributes the remaining 20% credit evenly across interim interactions between the first interaction and lead creation.
As implied by its name and shape, the first-touch, last-touch and the central sales opportunity creation events are assigned an equal 30% value each, while the rest of the actions are given 10%. This model is focused on the middle of the sales funnel giving further insight into the hand-off between marketing and sales.
This model distributes 90% of marketing attribution credit equally among four major interactions including the first-touch, lead creation, sales opportunity creation and last-touch. It takes into account the most important stages and can be leveraged by business models where deal negotiation or sales cycles are more lengthy.
7. Time Decay
In this model, the assets a prospect interacted with closer to the time of sale are the most important in the purchase decision and thus are weighted based on the recency of the events or actions. It assumes that the latter touchpoints trigger a bigger impact on the sale or conversion. For instance, an interaction 8 days before a conversion gets half as much credit as an ad interaction 1 day before a conversion. It may be best to use the time-decay attribution model for lengthier sales cycles and business models that rely on relationship-building, such as B2B marketing efforts.
8. Custom Attribution
Finally, there is also an option to come up with a custom attribution model. You may build customized algorithms to compute every channel or touchpoint’s significance with a given probability and set of rules. These bespoke statistical models can then assign credit percentages to various touchpoints based on your industry, marketing channels used and typical buyer behaviour.
Multi-channel attribution modeling can be complex. But you won’t truly know if you are spending your time and resources on the right marketing activities and channels without it. The more you start viewing marketing attribution through the multi-touch data lens, the easier it becomes to comprehend the complex customer journey.
Marketing attribution can be the missing link in your conversion rate optimization strategy that can help you measure the actual causation of conversion. Leverage the above marketing attribution models as a framework for analyzing which touchpoints are crucial in the path of conversion.