As a business owner or manager, it’s likely that you’ve tried out several marketing strategies over the years — you may even have multiple campaigns running on various marketing channels as we speak. With so much going on, though, it can be challenging to determine what’s working and what isn’t, but that’s where a new tactic steps in: Attribution marketing. What is attribution marketing, though?
At its core, attribution marketing is the practice of figuring out which of your current strategies are contributing the most to conversions or sales. It’s crucial to evaluate each touch point of the customer journey to determine which paths have the biggest impact on your bottom line. You can use several attribution models to calculate that sort of data, including multi-touch attribution, time decay, and lift studies, among others.
At Galactic Fed, we study different attribution models and analytics in order to drive conversions for our clients. With that said, let’s discuss what you need to know about attribution marketing and how we can help take your brand to the next level.
The Importance of the Sales Attribution Model
As it stands now, you likely invest in multiple marketing channels for your business, from email campaigns to display ads and so much more. In fact, a study conducted by Harvard Business Review found that, of 46,000 consumers, 73% used multiple channels to do their shopping.
However, in a scenario in which a consumer is exposed to your ads frequently but only finally converts after receiving an email with a promotion, such data would show your team that one marketing strategy (the promotional email) had a bigger impact than another (the display ad). As a result, you may want to allocate more of your marketing budget to targeted email campaigns.
Such forms the basis of attribution marketing: Discovering which of your marketing tactics receives the most “credit” in causing the prospective consumer to finally make a purchase and then investing more into that particular approach. The practice may sound daunting — after all, it’s a set of extra steps to tack on top of your already busy schedule — but the benefits of attribution marketing far outweigh its cons.
The more data you gather through attribution marketing, the more focus you can put on the strategies you know drive conversions, which not only saves your business money but also boosts your sales, making for a true win-win.
How Attribution Marketing Benefits Your Business
Attribution marketing is extremely popular in the digital marketing world. In fact, in a recent survey, 76% of marketers stated that they currently have, or plan to have, the capability to use attribution marketing.
Collecting attribution-based data can help you make marketing decisions that directly impact your bottom line in the following ways, such as:
- Allocating your marketing budget to channels you know drive sales
- Increasing your return on investment (ROI)
- Targeting your audience base with personalized marketing techniques
- Optimizing the creative elements of your campaign
These only form the tip of the iceberg of how attribution marketing can boost customer engagement and sales over time. You have little to lose and yet so much to gain beyond just sales numbers; you get to learn a lot about your customer base and their wants and needs.
Breaking Down Attribution Modelling Marketing
What is an attribution model? That’s a somewhat loaded question, as there are various types of attribution models that you can use to gather data about your customers, including the following:
Single-Touch Media Attribution Models
A single-touch attribution model gives a single touchpoint in the customer journey 100% of the credit for the resulting sale. While easy to use, a single-touch attribution model provides a limited view of performance.
The two most popular single-touch attribution models are as follows:
First-Touch Attribution Models
These models give the credit for a conversion to the first touchpoint a customer interacted with, even if they didn’t convert until much later down the line. With an intense focus on initial interactions, first-touch attribution models ignore subsequent touchpoints in the customer journey. In 2016, a survey of marketers found that 37% of respondents said first-touch attribution was their most used model.
Last-Click Attribution Models
A last-click attribution model gives credit for a conversion to the last touchpoint a customer interacts with before making their purchase — that is, the final interaction that secured the sale — but it doesn’t take the other touchpoints that may have led to it into account.
Multi-Touch Models
What is attribution modelling with regard to retrieving data from multiple touchpoints? Enter multi-touch attribution models, which give credit to several touchpoints throughout the customer journey that lead to a conversion.
These attribution models are preferred over single-touch variants, as they provide a more robust understanding of the customer’s purchasing process, but because they recognize the contributions of various touchpoints, they can be more complex and challenging to implement than their single-point counterparts, and each multi-touch attribution model has its own unique pros and cons.
Types of multi-touch attribution models include the following:
Linear Attribution Models
Linear attribution gives equal credit to every touchpoint throughout the customer journey, regardless of how significant each touchpoint is or if it’s closer to the beginning or end of the sales journey.
Time Decay
Time-decay attribution gives more credit to touchpoints that are closer to the conversion. The idea behind the model is that the more recent the interaction is, the greater the impact it has on a customer’s decision to make a purchase.
U-Shaped Attribution Models
U-shaped models give the majority of the credit to both the first and last touchpoints in the customer journey. The rest of the remaining credit is equally distributed throughout the middle parts of the journey.
W-Shaped Attribution Models
A W-shaped attribution model gives most of the credit to three touchpoints: the first one, the lead creation, and the opportunity creation. The rest of the credit is distributed among any other touchpoints.
Custom Attribution Models
Even with all of the above examples, you can ultimately customize your attribution models anyway you want to. You can give specific credit weights to various touchpoints based on your business’s unique strategy and what each touchpoint’s objectives are. Channel importance, engagement, and conversion likelihood are factors to consider when designing and implementing a custom attribution model.
Lift Studies
It can be challenging, if not impossible, to determine the precise cause of an individual conversion. For example, someone could purchase something from your brand because they saw your ad or because one of their friends recommended it.
Lift studies, however, offer attribution measurements that showcase the total effect of your advertising efforts through a randomized controlled trial, allowing you to measure how many of your business’s conversions come from your ads.
An example of a lift study could look like the following:
- Splitting an audience into two groups: a treatment group with targeting and a control group that doesn’t see your ads
- Measuring the number of conversions in both groups
- Seeing whether your ads increase conversions in the treatment group
Lift studies are time-consuming, but they can give you an understanding of your advertising efforts and how they influence your business’s conversion rates, valuable information that can help you determine which marketing strategies are worth investing most of your budget into.
Attribution Marketing Best Practices
Having answered, “What is attribution marketing?” here are some best practices to help get you started so you can set off on a path to success:
1. Choose Your KPIs Ahead of Time
Before you begin reporting, choose the right key performance indicators (KPIs) for your marketing, sales, and emails. Tracking data is challenging, especially if you aren’t used to doing it on a larger scale, and it’s not uncommon for marketers to pull reports only to find that they’re missing essential data.
It’s important to know that some attribution marketing tools won’t start pulling data until you create an event, which can cause problems down the line if you don’t choose and set up your KPIs in advance.
2. Try Moving to Backend Tracking
Backend tracking can help you collect accurate, reliable data that’s less susceptible to ad blockers. It is a decent long-term solution to the phase-out of cookies Google is planning to start in 2024.
You can use a third-party service to track data from the backend. While that takes some additional work, it will help your website collect valuable data as privacy concerns (and laws) continue to grow.
3. Automate Your Data Collection Wherever Possible
Automation can take repetitive marketing tasks and slash the time spent on them in half, not only helping to increase your outreach without hiring more employees but also assisting in creating targeted campaigns, which can help enhance the data gathered by your brand’s attribution models.
4. Connect Your Marketing and Sales Channels
For more insightful attribution data, connect your marketing and sales channels. Doing so combines them into a single customer journey and helps pinpoint any discrepancies in personas, customer data, and KPIs.
5. Use Your Goals to Inform Your Strategy
Goal setting is one of the most important aspects of developing and implementing robust attribution marketing models. Strong goals combined with attribution allow you to create metrics that are insightful and meaningful. You don’t want your reports to simply be interesting; you want them to help you rework your marketing plans to support your brand’s goals.
Attribution Model Marketing Tools
If you’re ready to hop on the attribution marketing train as soon as possible, you’ll need to use a combination of models to make the most effective optimizations. Nevertheless, the best way to get started is to invest in high-quality attribution marketing software and tools.
When choosing attribution software, consider the following aspects:
- Accuracy
- Speed
- Cross-channel marketing data
- Branding and performance connections
Many brands, from Adobe to Google, offer marketing attribution tools and software to a wide range of businesses. That said, it’s important to research each one to determine what will work best for your business’s needs, or consult a marketing agency to ensure you get the most effective results with the most reliable tools.
Which Attribution Model Is Right for Your Brand?
With a plethora of attribution marketing models available for you to implement at any moment, knowing which one is right for your business can be hard to ascertain right off the bat. With that said, it’s crucial to consider your sales cycles, how long they run, and how much of your marketing is online versus online. If you advertise through print, broadcast, or television, for instance, you’ll need to choose an attribution model that can take those marketing avenues into account.
When in doubt, reach out to an experienced marketing agency like Galactic Fed. Not only can we give you advice on all things attribution marketing, but we can also help implement these models into your overall marketing strategy. That way, you can focus on running your business while we take care of the rest.
Using Attribution Marketing Reports
Once you pick the right attribution marketing tools, you must create and properly make use of the reports you generate in order to track how successful your marketing efforts are.
Here is a step-by-step guide to the process:
1. Choose Your Time Period
Determine how often you want to conduct attribution reporting. Some businesses opt for weekly reporting, whereas others go the monthly route. Consider seasonality and how specific dates can impact your data.
For example, if your business runs an annual sale every summer, your data may look different during that time compared to other parts of the year, so always keep an eye out for patterns that can impact your research.
2. Better Understand Your Audience
Attribution marketing reports can help you determine your top marketing channels and your audience’s specific preferences. You’ll want to use your reports to answer questions like the following:
- How many leads does my content (e.g., blogs) generate?
- What marketing channels generate the most leads?
- What messages are my customers connecting with the most?
- Which of my website pages get the most views before a conversion?
Answering these questions can help you use your attribution marketing reports to better understand your audience’s behavior and better appeal to them as a result.
3. Pick the Right Data Collection Tools
Your business may already use data collection tools and strategies like surveys, interviews, and focus groups, but attribution marketing models can take your data collection efforts to a new level.
Quantitative data is beneficial for attribution reporting, but in order to get the most out of it, you must determine your business’s goals. Understand how many questions you want your attribution reports to answer, and whether you want a simple report or a more in-depth analysis. If you use Google Analytics, for instance, you’ll get over 100 reports for website analytics.
4. Choose the Best Attribution Marketing Model
Picking the right attribution marketing model for your business’s unique needs can be a challenge, so meet with your team to discuss your goals. The best part is that you don’t have to pick one model! Most businesses go with multiple attribution marketing models to yield the most comprehensive results.
5. Analyze Your Data
Analyzing your data can be easier said than done, but you can make it less daunting for yourself and your team through things like quality attribution marketing software, which will include graphics to help you visualize and present your data effectively.
6. Take Action
With your attribution models and software chosen, your data run, and a long list of results generated, it’s time to take action, using the data you collected to change your marketing strategy for the better.
Consider conducting market research and obtaining additional training to fill in any gaps you or your team may have in your knowledge. Make clear recommendations, get creative with your marketing experiments, and implement new strategies that will work based on the new data you have.
Common Attribution Marketing Mistakes
As helpful as attribution models are, they can be challenging to navigate, and there are plenty of common errors you may make that can negatively impact your results, such as:
Biases
We all have biases, and attribution models aren’t immune to them. Some biases to be aware of include the following:
Correlation-Based Biases
Correlation doesn’t always equal causation. When analyzing the customer journey, it may look like one event caused another, even if it didn’t.
In-Market Bias
An in-market bias refers to buyers who are already planning to purchase your product and who would’ve bought it whether they saw your advertisements or not. Still, with attribution marketing, the ad will get the credit for converting that customer.
Cheap Inventory Bias
These biases regard media and its performance. Lower-cost media may perform better because of the natural conversion rate for the targeted prospects, and ads may not have played a role.
Digital Signal Bias
Digital signal biases apply to businesses that sell their products or services online and in-store. Attribution marketing doesn’t factor in how offline sales can impact online activity and business overall.
Missing Message Signal
Missing message signaling occurs when some of your important marketing channels and touchpoints are not identified as impactful to your conversion rate. You don’t want any valuable touchpoints to slip through the cracks.
Attribution Marketing and Privacy
Today’s consumers care about their privacy. A recent survey of Americans saw 46% of respondents having concerns about companies tracking their online data. It’s not only the buyers who care about their privacy, though: The government does, too.
While we can’t give you legal advice, we can warn you that non-compliance with data privacy regulations like GSPR and the CCPA can result in fines and reputational damage, so you must ensure your attribution marketing practices comply with data privacy regulations.
Internet Cookies
We’ve all heard of digital cookies before. Often, when we access a website, a pop-up appears asking us to accept these mysterious virtual objects, but what are they?
Cookies are small files of information a web server generates about a user. They can give a business insight into consumer behavior and preferences, making them extremely useful for attribution marketing and reporting.
However, beginning in early 2024, Google will turn off third-party cookie support in Chrome for 1% of users worldwide, with the eventual goal of removing third-party cookies entirely. As a result, many attribution models marketing teams use across the country will need a strategic overhaul — yikes!
Living in a Cookieless Digital World
Fortunately, Google is developing a digital attribution modelling solution that can help businesses work their way through the upcoming cookieless landscape. Their software will store click events for a campaign in a consumer’s browser if they’re on a specific advertiser’s domain. Then, if they convert, the browser will notify you that an attribution event occurred.
Get Better Results With Personalized Marketing
Even with their increasing privacy concerns, consumers still appreciate when the companies they support show interest in them and their specific needs and preferences. Attribution marketing can help you understand your audience on a deeper level so you can better relate to them and ultimately market to them.
For example, let’s say your attribution marketing report shows that your social media channels drive a lot of conversions. You could then go onto your social pages and see which photos and videos are receiving the most engagement, and from there, you could gain insight into what content your audience enjoys and cater to that unique niche.
As a result, your customers will feel like you’re listening and engaging with them, increasing the odds of them making repeated purchases from your business.
Attribution Marketing Works
At the end of the day, the simplest answer to “What is attribution marketing?” is that it is your business’s key to long-term success. It is an extremely beneficial approach for businesses looking to get ahead and save time, money, and effort along the way. Choosing the right attribution model for your brand may take some trial and error, but you don’t have to find all the answers alone. Turn to a marketing agency like Galactic Fed: We’ll help you create more effective campaigns using attribution marketing, and once you know which marketing strategies boost conversions the most, you’ll be able to increase your ROI and take your business to new heights in time.
