Today, customer journeys are far from linear - they tend to happen across multiple platforms, devices and sessions, and make purchase decisions based on a variety of “touch points,” such as social media, mobile apps, dynamic banner ads and retargeting ads.
Pressure is building on brands to shift their advertising spend to digital, and rely more heavily on data to measure the success of their campaigns. And at the heart of this transition is attribution.
Marketing attribution is a method used by marketers to assign value to each channel that plays a role in influencing a consumer to make a purchase. For example, if a user visits your website through an organic search; returns later via a social network and then makes a purchase after clicking on a banner ad, which channel should get the credit?
In marketing attribution, a percentage of the purchase is assigned to each marketing channel, based on how far away that channel was from the order. When implemented effectively, attribution can be extremely useful in valuing conversions, determining the most influential channels for your marketing efforts and informing your digital marketing spend (aka campaign budget).
There is debate amongst marketers as to which of the various attribution model provides the most valuable data. Here is an overview of four of the most popular ones.
1. The First Interaction model attributes 100% of the conversion value to the first channel with which the customer interacted. This model is useful if you are running a campaign to create initial awareness. If your brand is not well known, you may place a premium on the keywords that first introduced customers to the brand.
2. The Last Interaction model attributes 100% of the conversion value to the last channel with which the customer interacted, before making a purchase. If your campaigns are designed to attract people at the point of sale, the Last Interaction model may be an appropriate model to use.
3. With the Linear Attribution model, every step on the customer journey is considered equal, and every channel receives an equal portion of the revenue. For example, in a customer journey where the consumer has five separate interactions with the brand, each interaction would be credited with 20% of the revenue from that customer.
4. The Position Based model allows you to create a hybrid of the First and Last Interaction models. Instead of giving all the credit to either the first or last interaction, it is split between them. One common scenario is to assign 40% credit to the first and last interactions, and 20% credit to the interactions in between.