How can you measure the ROI of your marketing campaigns using marketing attribution solutions?

Given the prominence of 'last-touch attribution', I often feel like the idea of 'attribution' can be linked to a sales mindset = who closed the deal? The most common attribution models - which should not even be called 'models' - are just naive rules. First touch, last touch, decay. They are easy to apply, scale and understand. They can be of value for small e-commerce businesses (if they just start their analytics journey). But usually they are misleading as they are rather arbitrary and can be gamed easily. Even algorithmic attribution models have serious flaws, particularly when based on web cookies (a dying species). It's better to rely on experiments to assess the effectiveness of digital ads and use MMM instead of general attribution.

You need to be careful with the attribution models listed in this article. With ad server driven attribution, you’ll see you may get different cookies for the same person and in your reporting you’ll think of these as different people and different customer journeys. Also, there has been experiments that don't really show much difference between first click and last click attribution, given that these clicks are typically tracked within the same user session. This is not necessarily conducive to reporting and what you end up with is a fragmented and incomplete view of your customer’s journey. The gold standard in the industry are identity based multi touch attribution models that move away from cookie reporting attribution systems.

Attribution approaches are poorly suited for measuring campaign effectiveness and ROMI. Even the “algorithmically enhanced” MTAs tell you nothing about incrementality, which is key to derive a meaningful ROMI. Short of building a Media Mix Model, ensure that you run every single campaign with a holdout, i.e. a group of customers who are deliberately excluded from the campaign. This would range from 5% to 20% of the total campaign audience and creates a natural test/control that will ensure you can measure the campaign’s performance against your KPI of choice. “But that would mean a loss of potential revenue” I hear you crying! I would much rather have a robust read on my campaign's ROMI then risking throwing money down the drain

Marketing attribution solutions are vital for measuring ROI by analyzing cust. touchpoints across channels and attributing conversions to specific efforts.This empowers businesses to identify highvalue campaigns,refining strategies for optimal performance.Understanding marketing efficacy is crucial for ROI maximization,with each model offering unique insights into the cust. journey.First Click highlights initial touchpoints role in awareness,Last Click emphasizes final touchpoints for conversion,Linear ensures equal acknowledgment of all touchpoints and TimeDecay prioritizes recent interactions.Customized attribution,especially useful with older data,tailors models for precise insights,aiding informed decisions for growth and profitability.

In all the leading DTC brands I worked at, there were inconsistencies in marketing attribution and optimization methodology. The first step is to understand the customer and business life cycle ( every company has nuances in its sales cycle and funnel metrics). Creating a basic customer LTV model even on cohort basis is a great starting point to standardize the RoAS measurement across channel tactics. Leverage the last touch and any other incremental lift tests to establish benchmarks and baseline. Facebook and Google provide a lot of open-source packages that can be leveraged on companies first party data

Note that the attribution models listed in this article will generally focus on clicks; media impressions also influence the awareness, consideration and purchase stages of the customer journey. Stitching all of this together at the different levels of campaign granularity is the challenge.

Return on investment alone is missleading as will include revenues that would have happened in the absence of marketing. What you want to try and track is incremental revenue, the net uplift of revenue caused by revenue. This is difficult to achieve with the attribution models listed in this article but can be achieved by identity-based multitouch attribution models (which are few and far between in the industry).

In a recent project, we implemented a multi-touch attribution model to track and analyze customer touchpoints across various channels throughout their journey. By analyzing attribution data, including first-touch, last-touch, and multi-touch interactions, we were able to identify the most effective channels and campaigns contributing to conversions. This analysis enabled us to allocate our marketing budget more efficiently, focusing on channels that provided the highest ROI. Additionally, it allowed us to refine our marketing strategy by optimizing messaging, targeting, and channel selection based on the insights gained from attribution data analysis.

It is also crucial to look at the Customer journey. MTA models help us understand what brought the customer in the system and what helped them convert. It would also help us understand the quality of the leads coming from each campaign (Leads converting or falling off mid funnel) and help us devise an efficient strategy. Depending on the programs key KPI, one could use first touch attribution is which is widely used for awareness KPIs while last touch attribution is widely used for sales KPIs. Again, it depends on the program expectations and touch point data should be leveraged to make an informed decision for optimal marketing spend.

Marketing attribution solutions play a crucial role in measuring the ROI of marketing campaigns by providing insights into the effectiveness of different touchpoints along the customer journey. By analyzing data from various channels and interactions, these solutions attribute conversions to specific marketing efforts, allowing marketers to understand which campaigns are driving results and which ones are underperforming. This enables them to allocate resources more effectively, focusing on the channels and tactics that yield the highest return on investment. Additionally, marketing attribution solutions help identify areas for optimization, enabling marketers to refine their strategies and improve overall campaign performance.

The first step to measure the ROI of marketing campaigns using marketing attribution solutions and refine marketing strategy is to Identify Key Metrics. This mainly means to determine relevant KPIs like conversion rate or customer acquisition cost to gauge campaign effectiveness. Marketing attribution helps track and analyze these metrics across various touchpoints, guiding strategy refinement.

Continuous improvement is crucial in marketing attribution to ensure the effectiveness of campaigns and maximize ROI. By regularly measuring and analyzing campaign performance using attribution data, marketers can identify areas for optimization and make informed decisions to enhance future efforts. Testing new approaches and models allows for innovation and adaptation to evolving consumer behavior and market trends. By remaining agile and responsive to data insights, marketers can continuously refine their strategies, leading to sustained success and stronger ROI over time.

To continuously improve marketing efforts using marketing attribution: Ongoing Analysis: Regularly measure and analyze campaign performance using attribution data. This ensures timely insights into what's working and what's not, allowing for quick adjustments to optimize results. Adaptability: Stay agile and open to change in response to shifts in the digital landscape and consumer behavior. Test new approaches and models based on attribution insights, and be ready to pivot strategies to maintain effectiveness and strengthen ROI.

Marketing attribution is overrated. If you use something like Google Analytics, your conversion sources are going to show Organic, Direct, Referral, Social or Paid Search. Google has no idea if someone watched a video on Social Media and then searched your brand name or came to your site. Be careful to not fall into the trap and understand your customers and where your content and marketing may be reaching them.