The Real Cost of Marketing Attribution Obsession

In the digital age, it's become increasingly difficult to measure the success of marketing efforts and attribute revenue to specific channels. While attribution software has traditionally been used to track the effectiveness of various channels, it may no longer be enough. Chris Walker, CEO of Refine Labs, argues that the "attribution mirage" occurs when customers enter the buying cycle in a way that is not accurately captured by the software, leading companies to make wrong decisions based on inaccurate data.

One major issue with attribution software is that it fails to take into account the influence of word-of-mouth marketing, which can be a significant driver of revenue.

In the case of Vapotherm, Chris Walker found that his efforts were not reflected in the company's pipeline and revenue, despite following traditional marketing tactics like lead generation and lead scoring. Upon further investigation, he discovered that much of the company's success was actually driven by word-of-mouth marketing, which the attribution software was not able to accurately measure.

One way to more accurately measure the success of social media and other channels is to ask customers directly how they heard about your company. This can be done through surveys or by including a "how did you hear about us?" question on customer forms.

In addition, win-lose analysis, which compares the success of deals won to those lost, can provide valuable insights into which channels are most effective.

Properly attributing marketing revenue can be a time-consuming and complex task, especially for startups that may not have the necessary tools or expertise in place. This can divert valuable time and resources away from other important marketing initiatives.

While it's important to know which marketing efforts are driving the most revenue, it's equally important to consider the overall health and success of your marketing strategy. An obsession with attribution can cause you to focus too narrowly on individual tactics, rather than taking a big picture view of your marketing efforts and how they contribute to the overall success of your business.

This obsession can come at a cost in terms of time, resources, and a narrow focus on short-term results.