7 Marketing Attribution Models that a Marketer should be aware Of

Marketing attribution is the art of assigning the right amount of credit to all the touch points involved in the sales cycle. Nowadays, the internet is bubbling with the rise of new channels to reach out to your customer, and everyone has multiple devices to access these channels on the internet.

It  may not be the sexiest aspect of advertising, but it’s pretty darn important. The good news is, most of us DO recognize that proper attribution is valuable, we just haven’t gotten our acts together and implemented a model that tells the complete story of our customer’s journey.

 Here we looks at seven of the common attribution models (or sets of rules) to attribute results to your marketing activity.While there are many different ‘off the shelf’ attribution models, this paper concentrates on 7 of the most common:

1 - Last Click or Last Interaction Attribution Model

Last Click is both the most commonly used model and one of the most inaccurate. This model assigns 100 per cent of revenue generated to the last customer touch point before a purchase.

You can see why this model is silly. In Most cases the credit goes to direct channel which is crazy. Social, Organic and Referral were also involved. We should figure out some way to identify their contribution to the conversion process, because they were involved in some form.

One scenarios could be if you’re conducting a flash sale on a relatively unheard of product with a large media spend. In this case last click will give you some useful, immediately actionable insights or if every single piece of marketing you undertake is aimed directly at driving sales. Last click will give you a quick and useful insights (Not fully accurate). It's better to move on to more sophisticated model for more accuracy.

2 - First Click/First Interaction Attribution Model

Reverse of last click. Rather than giving all the credit to the last click, give all the credit to the first click. 

First click attribution is equivalent  to giving my first girlfriend 100% of the credit for me marrying my wife. Which doesn’t make a sense, right?!

For example, if a customer first comes across your brand by clicking on an organic search listing, and then later spends $100 on your website, organic search is said to have driven $100 of revenue.

First Click come into play when you have a single channel strategy, i.e. you’re only using one marketing channel to promote your brand.
In this scenario, First click would be better than last click. Imagine launching a brand on Facebook and a consumer visiting you directly from that network. A week later, he return directly to your website to buy a product.In this case First click model is a more worthy model to attribute revenue.

3 -  Last Non-Direct Click Attribution Model

This model is similar to Last Click, except for cases when the Last Click is a Direct visit.  In such cases, this model finds the latest click that isn’t a direct visit and attributes 100% of the revenue to that channel instead.

The rationale behind this model is the idea that once a visitor comes directly to your website they have already made the decision to buy from you, so the cause of that purchase is not the direct visit itself, but the one that pre-empted that direct visit.

Google Analytics has a model called Last AdWords Click(for PPC), which takes whatever the most recent interaction a user had with Adwords as wholly responsible for sales. It doesn’t matter if they’d interacted with Adwords prior to the most recent click, or if they interacted with some, dozens or hundreds of other channels after the most recent Adwords click, the most recent Adwords click always receive 100% credit.

If you think that PPC is the one channel you are using to drive sales then you can use last Adwords Click to measure this. If you know that there is nothing on your website that is going to increase a user’s inclination to buy, then last Non-Direct Click  reflects this.

4 - Linear Attribution Model

Linear model states that every step of the customer journey is equally responsible. It is the democratic attribution model; every touch point gets credit for an equal portion of the revenue a customer spends.

Therefore, in a customer journey where the consumer had five interactions with the brand, each interaction will be credited with 20 per cent of the revenue from that customer.

Linear attribution can be useful if your marketing campaigns are designed to maintain contact and awareness with prospects through the entire customer journey. For example, if you’re running a brand campaign and each touch point is equally important during the consideration phase, linear attribution will help you visualize this process.

5 - Position Based Attribution Model

While the familiar path of Awareness to Consideration and to Conversion has become more sophisticated in recent years, the fact that there is a journey, which starts with a potential customer finding out about a brand, is undeniable.

The Positional model acknowledges and represents this by combining aspects of First Click, Last Click and Linear. Essentially it says that the first touch point and the last touch point are worth X per cent each, and all the other touch points in between have the remaining percentage divided up evenly among them.

A common set-up of positional model is to have 40% of the credit to the first and the last interaction and the remaining 20% is distributed evenly to all the interactions in the middle.

This is a great model to use if you value not only the touch points that introduce customers to your brand, but also the final clicks that result in conversion. But, If your data isn’t clean, or if you have little experience attributing values to each touch point, this model can steer you in a bad direction—fast.

6 - Time Decay Attribution Model

This model uses an algorithm to give the most credit to the channel closest to the conversion and increasingly less to the rest of the channels. That means the closer (in terms of time) a touch point is to the conversion, the more influence that touch point had on the customer decision.

Time decay attribution can be customized to map to your sales cycle, particularly those sales cycles that have shorter consideration phases. If you are not doing a custom model and doing a lot of testing with your data, time decay is a feasible model that more truly imitates prospect behavior, because prospects become more acquainted with your brand as they have had more time to consider purchasing your goods or services.

While the Time Decay model is one of the more sophisticated, in both implementation and understanding, this does not make it the best or the one that everyone should use.

7 - Custom Attribution Model

This is the holy grail of attribution models! You can mold your model around more specific business questions and objectives and compare your custom model and other default models side-by-side.

With this model you can use the linear, first-click, last-click, time decay, and position-based attribution models as your baseline, and then layer in other factors important for your business. The best part is that it is personalized for your website and your business and can be optimized over time.

Do not attempt to use custom attribution without first doing some controlled tests on your data and campaigns to see which variables and channels actually make a difference in your conversion values. You should get to know the other models very well before jumping into this arena.

One of the main pain in the ass for digital marketers in doing attribution is Inbound calls which are offline and need tools to track it.

As consumers are switching between the online and the offline spaces so frequently that the line between the two worlds are blurring. They now live in a ‘non-line’ world.

The strongest seed for the non-line world is this: Calls. The smartphone revolution has ensured that anyone who wants to make a call today does it easily without much hassle.

Websites have click-to-call buttons that facilitate instant calls. Google search results in your smartphone display a call button that takes the consumer straight to the dial-pad with the number on it, all ready to dial – how convenient is that?!  Also, call rates have gone down and people do not look at phone calls as a luxury anymore.

Performing attribution in the non-line world is not easy. Tracking online marketing to offline conversions is not easy, because there is no exact way to identify which online touchpoint prompted a consumer to make an offline purchase. However, there are a few workarounds:

• Send unique coupons through email and social media, prompting consumers to use it in the store
• Conduct controlled experiments – Take two sets of people, with all the variables same but one. Perform tests on these sets, analyse the results from both sets.
• Call Tracking – Track all calls coming in to business. Assign a unique phone number for each channel, which is not available on any other channel.

As you can see, there are many attribution models out there and the only way you’re going to find one that is right for your business is to test and optimize each one. Use some dummy data sets to test different campaigns and channels. There is no “perfect” model out there because your business, industry, and data will always be changing. Don’t let this scare you. Let this empower you to start looking into a good measurement plan and get started on your way to be a solid competitor in your space.

#NoMoreGuessing