How can you identify the most effective marketing channels using marketing attribution solutions?

Different attribution models have different priorities. Ensuring your organization's priorities are aligned to that of the attribution model is essential. For example, last-touch (or last click) attribution always will give the most credit to demand capture channels such as paid search or affiliate. If an organization prioritizes budget based on last-touch attribution, sales may stagnate or decline over time because demand is captured but not generated.

Imagine we're running a campaign to promote a new summer clothing line. An attribution model determines how credit for a sale is distributed among the different marketing touchpoints a customer interacts with. Common models include: Last-Touch Attribution: The final ad a customer clicks before buying gets all the credit (e.g., someone sees a social media ad then clicks a website banner ad that leads to a purchase).

You run an online store. A customer sees your social media ad (touchpoint 1), browses your site (touchpoint 2) but leaves. Later, an influencer raves about your product (touchpoint 3), reminding them to buy. How much credit should each marketing effort get? Marketing attribution models answer this. They assign credit to different marketing channels based on their role in a customer's purchase journey. Some models, like "Last Click," credit the final touchpoint before a purchase. Others, like "Time Decay," spread credit more evenly or favor touchpoints closer to the sale. Understanding these models helps you choose the one that aligns with your goals and provides a clearer picture of which marketing channels are most effective.

A CRM handles data at the person-level and so channels with a lot of anonymized data (such as social or online video) don't fit in cleanly. Consider building a data lake to house as much granular data as you can (including log-level files). The more granular the data, the more future-proof your system.

This is where we gather customer journey data across various channels. We might use website tracking pixels to see how customers browse your clothing line on your website, what pages they visit, and how they interact with different elements (add to cart, product reviews). Email marketing software tracks email opens, click-through rates, and purchases made from within your emails. Social media analytics platforms provide insights into how users engage with your brand on social media, including which content resonates most, what kind of comments you receive, and how many clicks you get from social media posts to your website.

In the clothing line example, we might see many customers discover the brand on social media, then visit the website after reading a blog post (content marketing touchpoint) that discusses the latest summer fashion trends. They browse specific product pages (website browsing touchpoint), perhaps lingering on a particular dress. Maybe they abandon their cart at this point. Later, they receive an email discount (email marketing touchpoint) that reignites their interest, and they complete the purchase. This customer journey highlights the importance of multiple touchpoints. Social media sparked brand awareness, content marketing provided education and product information, and email marketing offered a final nudge towards conversion.

Imagine you track a customer who sees a funny meme about your product on Facebook (awareness), then downloads a helpful guide from your website (consideration), and finally signs up for a free trial through a retargeting ad they saw while browsing (conversion). Analyzing this journey shows Facebook sparked initial interest, the website nurtured it, and the retargeting ad sealed the deal. By understanding these touchpoints, you can attribute value effectively. Facebook might be great for brand awareness, while the website is key for driving conversions. This lets you invest more in retargeting and website optimization, maximizing your return on investment

Multi-touch Attribution is poorly suited for measuring the effectiveness at marketing channel level. Even “algorithmically enhanced” MTAs tell you nothing about incrementality, which is key to determine true channel effectiveness. If you cannot opt for Marketing Mix Modelling, make sure you include a holdout in every single activity you do. A holdout is a group of customers who are deliberately excluded from the activity. It could range from 5% to 20% of the total audience and creates a natural test/control that ensures you can safely measure performance against your KPI of choice. “But that would mean a loss of potential revenue” I hear you crying! I would much rather get a slight setback now to maximise future revenue"

Multi-touch attribution recognizes that most customers have multiple touchpoints with a brand before converting, and assigns credit to each touchpoint along the customer journey based on a predetermined model. In the clothing line case, social media sparked initial interest, content marketing educated the customer about the products and brand, and email marketing incentivized the purchase with a discount. Multi-touch attribution helps you understand how different marketing channels work together to influence customers. By attributing value to each touchpoint, you gain a more complete picture of which channels are most effective at driving awareness, consideration, and conversion throughout the customer journey.

Real-world scenarios can get messy. Offline marketing channels like billboards or bus ads are difficult to track directly. Their influence might be subtle, creating brand awareness or reminding customers of your business. In-store influences are also hard to quantify. Additionally, attribution can become complex when customers have long and cross device buying journeys. For example, someone might see the social media ad weeks before visiting the website, then read a review blog post before signing up for the email list, and finally make a purchase after receiving a discount code in an email. How much credit should each touchpoint receive? Different attribution models address this challenge in various ways, but there's no perfect solution.

Marketing attribution isn't a set-it-and-forget-it process. The real power comes from using the data to continuously improve your marketing strategy. Here's how: - Regular Reviews: As you collect more data and refine your attribution model, revisit your channel strategy. This constant evaluation ensures you're basing decisions on the latest insights. - Testing and Optimization: Don't be afraid to experiment! Test different approaches, like reallocating budget from underperforming channels to stronger ones, or tweaking your messaging for specific channels. - Performance Monitoring: Track how these adjustments affect your marketing performance. Did a budget shift to a different channel lead to a surge in conversions?