Hi

In Business Maths Made Simple I said, “Very few business owners track their marketing metrics accurately. They don't know how much it costs them to generate a lead from each of the marketing pillars they employ or their conversion rates from lead to prospect to customers. Without this key data much of what they spend on marketing may be wasted.” 

The solution is to understand marketing attribution and what it can deliver to gain insight into how your customers purchase your product or service.

Marketing attribution is all about understanding where and how your customers come to you. You can use it to determine which of your marketing pillars are driving the greatest return on investment. 

Attribution helps you understand which marketing pillars are most effective at driving lead conversions. It is a powerful tool that helps you understand the critical customer touchpoints on the journey to sales conversion ('What and how of marketing attribution', Medium, August 2021).

Attribution is essential to understanding how customers arrive at their purchasing decisions. With accurate attribution, businesses can better determine what motivates their customers to engage with them at each step of the buyer’s journey.

Using tools like cookies (to see which webpages users are loading), UTMs (urchin tracking module codes which are snippets of code attached to the end of a URL and help determine specific sources of traffic across your website) and asking queries at the checkout stage as to where your customers heard about you, all track the customer journey and are some of the marketing attribution tools you can use for discovery and learning about engagement.

Not surprisingly there are numerous marketing attribution software applications on the market. 

There are two main types of attribution models: single and multi-touch ('Is marketing attribution an art or a science?', The Journal by Flinder, Issue 9)

‍Single-touch attribution models

First-Touch Attribution:  First-touch attribution is based on the assumption that a consumer chose to convert after the first touchpoint they engaged with and then assigns full attribution to this first touchpoint, regardless of additional messaging seen subsequently.

Last-Touch Attribution:  In contrast, last-touch attribution assigns full attribution to the last touchpoint the consumer interacted with before making the purchase, without accounting for prior engagements.

These models offer a limited view as they don’t take into account the full buyer journey and  don’t give the full picture to the marketing team.

‍Multi-touch attribution models

Multi-touch attribution models assess all the engaged consumer touchpoints leading to a purchase/conversion. As a result, these are considered more accurate models. They assign different levels of credit across the various touchpoints on the buyer journey.

Linear: Linear attribution records each touchpoint engaged with by the consumer leading to purchase. It weighs each of these interactions equally, giving each message the same amount of credit toward driving the conversion.

U-Shaped: U-Shaped attribution model scores engagements separately, noting that some are more impactful than others on the path to purchase, differing from the linear model. The first touch and conversion touch are each credited with 40% of responsibility for the lead. The other 20% is divided among the touchpoints engaged with between the first and lead conversion touch.

Time Decay: This model gives the touchpoints engaged with closer to the conversion more weight than those engaged with early on based on the assumption that later touchpoints have a greater impact on the sale.

‍Next steps for implementing marketing attribution in your business

Businesses need to consider several factors when looking at which attribution model is the right fit. The key is to think about the type of sales funnel you use and typically how long it runs to gauge what might work best.

It’s also important to consider how much of your marketing efforts are focused on offline methods such as print or even events. If your business uses these channels more frequently, consider an attribution model and platform that’s able to combine online and offline efforts together for the most accurate insights.

Summary

It is likely that your business will have to use several attribution models in tandem for the most complete understanding of your marketing impact. Marketing attribution is most definitely both a science, by looking at how the hard data effects your marketing choices, and an art, in understanding the creative response that you employ to lead your customer on their journey as they engage with your product.

Noel Guilford

PS If you haven't got a copy of Business Maths Made Simple you can purchase it here.