Wouldn’t you like to know which touchpoints in your customer journey had the greatest impact on your prospects’ decision to convert? That’s exactly what attribution modeling reveals. Whether you’re spending your efforts on content marketing, mobile, or some other medium, you need to be able to rank each channel’s influence on buying decisions to know which campaigns to focus on. With attribution modeling, you can depicter the different touchpoints and credit them proportionately.
What is Attribution Modeling?
Simply put, attribution modeling is the process of allocating relative value to every marketing touchpoint across all offline and online channels to know which efforts are generating the highest returns in sales. While vanity metrics like total clicks and open rates are super easy to track, the critical data about which touchpoints assisted the sale is best obtained from attribution models.
Recognizing the impact of each marketing channel, or touchpoint, is critical because it helps you do three things:
Understand which of your marketing activities are working
Allocate your budget wisely
Discover the optimal number of interactions needed to drive a sale
With so many touchpoints in existence, measuring the impact of each step in the buying cycle has become increasingly challenging. Therefore, to evaluate what attribution model is right for you, you need to understand the entire customer journey. For instance, how many touches does it take to a prospect to convert?
After you get past this point, there are a number of marketing attribution models that have sprung up since the ecommerce boom to account for multi-channel customer experiences.
Types of Attribution Models
Organizations have various attribution models to choose from. Let’s analyze the most popular ones and their use cases.
In this attribution model, the first touchpoint gets 100% credit for the sale. For example, if a customer finds your brand through a Facebook ad, that Facebook ad gets all the credit for any conversion that occurs after the initial interaction. It’s most effective for campaigns that are limited to one or two activities and also to see what really drives awareness.
When it comes to Linear attribution modeling, every touchpoint in the customer journey gets equal credit for the conversion. If someone finds your website through Google, then joins your email list, and clicks the link in your lead magnet to make a purchase, the Linear model would give credit to all three channels. Use this model to determine the overall ROI of your branding efforts.
The Last Click or Last Touch attribution model assigns 100% of the credit to the final touchpoint before a conversion. For instance, if a customer discovers your website through a Facebook ad and later uses your mobile app to buy your product or service, all of the credit will be attributed to the mobile app. Hence, last touch attribution can help companies discover the “deciding factor” that generated a conversion.
In this attribution model, the channels closest to the conversion point get the most credit while the channels present at the beginning of the customer journey receive less credit. For example, if someone sees your brand on Instagram and then goes to a landing page on your website and ends up becoming a paying customer, the landing page would receive significantly more credit than Instagram. Consider using Time Decay attribution modeling to weigh different touchpoints based on their closeness to a successful sale.
In a Position-Based attribution model, the first and last touchpoint of a buyer’s journey receive 80% of the credit collectively (40% each), while the remaining 20% is applied evenly to all the channels in the middle. Case in point: someone runs sees your brand in Google’s search listings, visits your website and joins your email list. A week later they see a Facebook ad for your products and make a purchase. In this case, Google Search and the Facebook ad receive the most credit, while your website and email marketing activity would get partial credit. Position Based attribution modeling can, therefore, be used to measure the impact of every channel in the customer journey.
Identifying The Ideal Attribution Model for Your Business
As with most things, there’s no “perfect” attribution model out there, but there’s a variety of factors – number of channels, customer journey, length of buying cycle, and more – that’ll help dictate the best attribution model for your business.
For companies dealing with longer, multi-touch customer journeys, a Position-Based or Time Decay attribution model is likely the most ideal and flexible. Both can tell the story for long conversion paths; the longer it takes for prospects to convert, the greater the likelihood that the customer journey is complicated and might include competitor analysis, retargeting, and email reminders down the road.
In contrast, marketers dealing with shorter buying cycles would find single touch models like First Click and Last Touch Attribution as more useful for measuring direct response and brand awareness campaigns. With that said, a hybrid approach is likely to deliver the best insights, and the more you A/B test and optimize, the closer you’ll get to attribution that works.
Many analytics solutions – Heap included – can help provide the data needed to help you build a comprehensive picture of your customer journey. In Heap, you can even tag events like watching a webinar, downloading a case study, or browsing a landing page. With this data, you can determine which attribution model gives credit to channels that deserve it the most. This will enable you to make sound analytical decisions that’ll help improve your bottom line.Learn more about conversion rate optimization at Heap.