What is marketing attribution?

Thursday, 22 November 2018 Category: Marketing attribution

Once upon a time, 10+ years ago, marketers didn’t have the foggiest which campaigns were bringing in sales. Actually – that’s a bit harsh. They had a vague idea.

So what’s changed? A couple of things had a big effect on Marketing departments. They began elevating into a strategic function within organisations and treated less like sales support. Their shift to the Board meant they became accountable for their expenditure and scrutinised for ROI. Marketing attribution still means the same thing (how you calculate the ROI of your marketing efforts), but despite the ever-increasing volumes of audience and performance data, marketers are still struggling to understand how attribution fits within their overall strategy. They’re also confused as to how it benefits their budgets and creates relevant experiences that drive meaningful results.

But it’s not all confusion. 72% of marketers and agencies say that attribution enables better budget allocation across channels, and better returns. So, getting it right in your organisation save you £s. Ultimately, if you can safeguard your budget to justify an increase the next year, you really need to understand which channels are bringing in ROI.

Other reasons to embrace attribution are:

Justifying digital and offline spend
Create more effective media based on true value toward conversion
Understanding funnel and sales cycle length to plan campaigns
Correctly determining affiliate payments

The challenge for the modern-day marketer

Why is attribution so complicated then? Surely understanding the influence that a touchpoint, or a combination of touchpoints, has on the customer’s decision to buy, means marketers can make necessary adjustments to campaigns? Yes – but there are a few things to note that make the process a little less straightforward:

#1 The buying process isn’t linear

It’s more like a big bowl of spaghetti, with a tangled chaos of interactions occurring across multiple channels and devices, and sometime over a long period of time.

#2 People are more informed and self-serve

With vast amounts of information at their fingertips, consumers know around 85% about the product or service before they contact you about it. During their purchasing journey, a typical buyer will consume around six pieces of information that could include an advert, a product description, a video, a demo, customer reviews, price comparison, the competition’s product.

#3 Some channels are harder to track than others

Online channels are easy to track but there is so much information, it’s possible to get overwhelmed and not make sense of it all. The sheer volume of online channel data has overshadowed offline channels, simply because they are easier to track, not because they aren’t relevant. Offline channels are notoriously difficult to trace, and marketers can be tempted to shrug them off. But offline could be the main revenue channels for some organisations, so it’s important to find a way to track them.

#4 What do you believe?

With so many online analytics channels and tools out there, and some mediums coming under scrutiny for embellishing the truth behind them, and inconsistencies between platforms when comparing data, it’s difficult to know what data to trust.

This means that marketers are looking for a nice comprehensive, accurate way of measuring the impact of their efforts, regardless of the touchpoint type. But it can be hard to know where to start.

Here are a few tips…

Step 1 – Set up your company for attribution

The first place to start is to identify all the ways in which consumers can contact your business. Then put a process in place to track where they found your company. For example:

Telephone: Install telephone or call tracking on your website and offline advertising. This facilitates tracking the source and customer journey of every lead and sale that contacts your business by phone.
Email: Add tracking code to your website to track the instances visitors click the email address link on your website. You can track the source of the enquiry and their other interaction before they click on the email link.
Forms: Once a form is filled, the user is directed to a ‘thank you’ page. These can be set up as a goal in Google Analytics to track these.
Live Chat: This popular website messaging service gives customers access to an agent for general enquiries. These can be tracked by setting up a tag to track a Live Chat conversation being triggered.
eCommerce: online sales or ‘conversions’ can be setup easily on Google Analytics.
In-store: Discount codes and loyalty cards that can only be used in store are great ways to track your customer purchasing habits. Assign different codes to different channels and set up your POS systems to log where in-store purchasers heard about your company.

Putting systems like these in place will make it easier for you to understand the contact channels your customers prefer. It will also help you locate the source of their original visit, and all the interaction in between.

Step 2 – Choose an attribution approach

There are multiple attribution approaches. The one you choose largely depends on business goals and needs, and how sophisticated your marketing is. For example, a B2C brand may want to understand how each channel is driving total sales on a quarterly basis, whereas a B2B brand may want to understand yesterday’s top performing keyword in driving online sales. Both will need a different attribution strategy.

Step 3 – Choose a marketing attribution model

Below are definitions of standard attribution models. You’ll find these in use with Google Analytics for your online channels, but they also work with software that can track interaction with offline channels such as inbound phone calls. Your infrastructure, investment and time requirements will be based on the model you choose. If you’re just starting out, first and last interaction attribution is a great place to start. If you find you need more in-depth reporting, you can build up to multi-touch attribution like Linear, Time Decay and Position based.

Last Touch/Interaction: This is the easiest and most commonly used model that gives 100 percent of the credit for a conversion to the last touchpoint. Because it’s easy and doesn’t consider any interaction before it as an influencer, it has come under a lot of criticism.
Last Non-Direct Click: This attribution model gives credit to the last touch before a conversion takes place. For example, if someone clicks on a Google AdWords text ad and then converts on a website, the paid ad would receive 100 percent of the credit.
First Interaction: This is the opposite of Last Interaction. The first touchpoint would receive 100 percent of a conversion’s credit. Like last click, this focuses purely on the source, and none of the factors that may affect the buying process up to purchase.
Linear: This assigns each touchpoint in a conversion equally. For example, if there were five touchpoints, each would be awarded 20 percent of the conversion.
Time Decay: This model assigns greater value to interactions, the closer they are to the sale taking place. This is fast becoming the popular option with marketers as it considers the full customer journey.
Position Based: This model weights the first and last touchpoints heavily at 40 percent each, while distributing the remaining 20 percent across the touchpoints in the middle. This model assumes that the interactions that create awareness and close a sale are more valuable than the interactions that nurture it.

Key takeaways

To summarise, the customer ‘consideration phase’ is becoming as important to marketers as where they found out about the business and where they ended up making a purchase. The journey to purchase involves many different touchpoints and can take some time to convert.

Marketing attribution is a powerful tool that can give you a wealth of information about marketing efforts at all stages of the buying cycle. It can be as simple or complex as you need it to be, from tracking a single conversion point to every touchpoint.

Key to getting your organisation set up for marketing attribution are:

Step 1 – identify the channels your customers contact you through, including offline
Step 2 – Choose an attribution approach and the tools that will enable you to measure online and offline interactions
Step 3 – Choose and attribution model relevant to your business that will help calculate your ROI

Regardless of the model you choose, your reports are only as good as you make them, so ensure you have a reliable infrastructure that provides clean data, as well as the time needed to review and understand the reports you are producing.

When done well, marketing attribution shows us which marketing efforts influence our customers, and ultimately, which bring in revenue.

For more information

Mediahawk specialises in call tracking and multi-touch attribution. If you would like to chat to us about how you can start setting your company up for online and offline marketing attribution, we’d love to hear from you.