What Is Marketing Attribution? A Complete Guide
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With the rise of multi-channel marketing, it is a new challenge in marketing to determine which channel is most effective for it.
This helps businesses understand consumer behavior and interests. It also makes it easier to understand the channel and trends in the marketing. This is why the concept of marketing attribution was laid out, to help businesses better understand consumer touchpoints and the dependency on conversion rates in relation to them.
In this article, we will go around this term and understand the term, its effects, and the models that are effective for better marketing.
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Marketing attribution refers to the process of identifying effective touchpoints with which the consumer comes into interaction. Precisely, the process of recognizing the touchpoints that played a major role in conversion rates is known as marketing attribution or multi-channel attribution.
There are several multi-channel models used such as multi-touch attribution, time decay, life studies, B2B marketing attribution, and more according to the needs of the business.
Marketing attribution is important for businesses to understand the most effective channel of marketing, evaluate, and better understand consumer behavior and interests. Which helps customize marketing tactics and improve budget allocation according to customer touchpoints and conversion rates.
For example, if a consumer sees an ad, but they make a purchase through an email campaign, it means that the business needs to spend more budget on email campaigns.
Brand attribution is like the heart of marketing and conversion. It is most used to:
For increased ROI and a better understanding of consumer mindset, it is required to closely monitor the marketing attributes. It is vital to identify where the budget is spent and which channel out of all gives the most and the best results.
To understand attribution in marketing in detail, let's take a look at the benefits it offers.
By analyzing the effective touch points that help the best in identifying customers' buying action, marketers can optimize their budget and maintain their ad spend in a better way.
Budget allocation results in better ROI. By brand attribution, businesses can identify which marketing tactics work the best and spend on campaigns that have worked in the past.
Understanding consumer action and choices, marketers customize their ads for increased ROI. It helps reach the right audience with the right message. This saves from wasted budget and wasted time.
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Marketing attribution involves numerous channels, which becomes time-consuming and a hassle to take a look at each channel manually. For this purpose, marketing attribution models are made. Each model has a different function. Selecting the right model is dependent on the type of business. It is vital to choose the right model to determine the next step.
Models are developed to measure different marketing insights. The marketing attribution model is categorized into two main categories: single-touch and multi-touch.
There are several models that run under these two main categories which function differently and are made for different purposes.
In this model, the credit to conversion is included within a single touchpoint in the customer’s purchase journey. It could be the first-touch or the last-touch. This attribution ignores other touchpoints and gives credit to just one.
It calculates that the customer purchased from the first touchpoint they saw.
This credits the last touchpoint the customer interacted with ignoring any prior interactions.
This model considers all the touchpoints that a customer goes through for a conversion. Which is why it is considered to be more accurate.
There are more sub-models included in this model.
It considers every single touchpoint that the consumer interacts during the purchase journey. Here, every touchpoint is given equal credit.
In this model, some channels are scored more than others.
In this model, the touchpoints that are the closest to the conversion are given more weight than those that were touched before those. This model assumes that these touchpoints had more impact on the conversion.
This model is similar to the U-shaped model. It includes one more attribute along with the first touchpoint, conversion, which is the opportunity attribute.
These models help in marketing attribution optimization. Each model is made for a different purpose. Businesses need to identify which model they need to implement or which suits the business the most.
To decide on the marketing attribution model accurately, businesses need to know their specific results requirements and the kind of outcomes they require.
To begin with, the first thing that needs to be considered is what kind of sales cycle is implemented. The second thing that needs to be focused on is, how long the cycle runs on average. Third is, how many conversions are online and how many are offline.
Businesses that employ both offline and online marketing need models that are designed for the specific purposes of each.
E-commerce businesses don’t require models that are for offline businesses unless they employ offline marketing techniques such as print ads or TV ads. For online marketing, the most suitable model is the multi-touch model. For offline marketing, the marketing mix model has been reported to work the best.
There are a few misconceptions that come into play when marketers get into marketing attribution. These can result in wrong results, which is harmful when deciding on the next steps in the marketing funnel.
For businesses to avoid potential misconceptions, they need to know the following mistakes:
This implies false positives. This means that one event is considered to be dependent on another event which is not actually dependent. It means that one event in the marketing journey caused another event which resulted in the customer making the purchase. When in reality the purchase was actually due to some other reason.
For example, if the sales of an ice cream business spike in summer, they might attribute these sales to the imagery of hot and melting weather. Whereas the actual reason is only based on the weather.
They might credit their advertising images for the increased sales.
This implies that the customer purchased due to the product being present physically in the market, independent of seeing the ad. However, the business assumes that the consumer made the purchase by seeing the ad.
Sometimes marketers think that their sales boost is due to cheap prices of the product or services. Here it implies that the ads might not have an upper hand in the purchase, but the marketers see it as the sales inclined towards their ads.
This error refers to mistakes in calculating offline and online insights. Marketers confuse the two which results in inaccurate results and mistakes in planning future steps to take in marketing attribution.
This refers to the missed campaign or element that plays an important role in sales. However, due to it being too small or too insignificant that it doesn’t even appear in the results, it might be overlooked.
Marketing attribution is a complex concept in the marketing journey. It is customer-focused. Here is not one single model that suits each business. And businesses need to be careful in choosing which one. For this, they need to identify the factors that they want to monitor and choose the relevant model that aligns with their business needs.
To boost sales and marketing performance, attribution in marketing is a must. Without properly monitoring each marketing attribute or element, better performance of marketing techniques is not sure to occur.
Marketing attribution is like the brain of marketing. Without it, businesses are not sure to perform better than their past performance. To boost business performance, individuals need to measure and monitor each element of their sales funnel.
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