Sometimes, it’s hard to tell what part of your marketing strategy led to conversion, especially when using multiple channels. When leads are coming in from emails, landing pages, and social media, which actions do you attribute sales to?
A marketing attribution strategy can help you analyze conversions and link them to specific customer journey stages. From here, you can optimize your strategy to favor these channels and increase ROI while reducing costs.
Below, we talk about marketing attribution in more detail and the different models that can boost impact.
What Is Marketing Attribution?
Marketing attribution is a framework that helps marketers determine which customer interactions, known as touchpoints, lead to desired actions, e.g., a sale. These touchpoints can represent ad clicks, site visits, subscriptions, etc. Understanding these touchpoints is crucial as it allows marketers to steer their marketing strategy in the right direction.
Marketers present this data in the form of a a marketing attribution report containing charts and visuals ready for analysis. From here, marketers can tweak the strategy, switch marketing channels, implement new tools, etc. The best way to generate reports is via a marketing attribution software, which includes:
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Several marketing attribution models to choose from
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Event funnel tracking
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Cookieless tracking
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Probabilistic attribution, and more.
The main benefit of marketing attribution is transparency – you get full insight into your marketing strategy, how it’s performing, and what channels/metrics are driving its success.
Why Your Business Needs Marketing Attribution
Every business with an online presence needs a marketing attribution system. Think about it this way: from awareness to conversion, there are so many different traffic sources involved in the customer journey. Customers go through several stages strategically set up to lead them to the finish line. So, you might have traffic coming in from affiliate links, paid searches, newsletters, social media, etc.
To keep track of all this data, you need a comprehensive marketing attribution model that tracks how your customers move through the sales funnel. This will help you determine what works for your strategy and what doesn’t.
What Is a Marketing Attribution Model?
Around 49% of businesses consider customer acquisition vital for making a profit. However, an even bigger number find it difficult to decipher and act on attribution insights.
A marketing attribution model is a system set up to record the touchpoints a user or customer passes through during the customer journey. It can show you whether a customer came from a paid ad or organic search and which strategy is more effective. You may even find that particular touchpoints are underperforming, helping you redirect the budget to strategies that work.
Let’s look at the different types of marketing attribution models to help you determine the best one for you:
First Click Marketing Attribution Model
In this model, the initial interaction a customer has with your brand matters the most. The conversion is attributed to the very first action the customer takes to go through all the subsequent customer journey stages.
The biggest benefit of this model is that it’s easiest to track. You don’t need a complicated strategy to pull data from different sources; rather, this one interaction gives you the answer.
First-click marketing attribution is vital to discovering what initially piques your customers' interest. This can help you tailor your entire strategy to get more impressions that lead to sales. It is most suitable for bringing your brand closer to your audience without the primary goal of selling but rather raising brand awareness.
However, this model also has its drawbacks. For example, it can be hard to determine where a sale came from if you don’t take into account low- and mid-funnel strategies that may have influenced the customer to buy.
Last Click Attribution Model
The last-click attribution model looks at the very last step your customers take before clicking the ‘purchase’ button. It focuses more on conversion rather than audience interest in your products or services.
This attribution model can include touchpoints like landing pages, CTAs, pop-ups, retargeting, etc. By understanding what it is that drove a customer to buy, you’ll have an easier time optimizing your strategy for conversions.
However, while this is a straightforward way to keep track of sales, it does have its limitations.
Let’s say a customer found your site via organic search and clicked on a high-ranking article. After finding value in your content, they decide to buy through the CTA at the end of your text. However, it wasn’t the CTA that prompted the customer to buy; rather, it was the value you provided to them. This can lead to touchpoint misattribution.
So, be mindful of when you use this attribution model
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For short sales cycles
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Final touchpoint optimization
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Quick sales analysis on a restricted budget.
Multi Attribution
Some marketers prefer the multi-attribution model because it allows them to be more thorough with their analysis. This model takes into account each stage the customer goes through before purchasing – discovery, awareness, consideration, and purchase.
This model gives marketers insight into how well their strategy is put together and how it works in synergy to drive sales. A big advantage of this model is that it focuses on both customer acquisition and customer retention. It’s not just about getting sales – it’s also about nurturing leads and guiding them through the whole brand journey.
Again, there’s no one-size-fits-all strategy in marketing. So, while multi-attribution is great for strategy development, it can also promote an oversimplified view of customer actions. In many cases, one single action is the main driver of a sale, and this model focuses on all of them, overshadowing the impact of specific actions.
This marketing attribution model is best paired with a more specific model to give better insight into the most effective touchpoints.
Custom Attribution
This model takes into account your specific business needs. It involves a custom strategy that addresses your customers’ pain points and sets touchpoints that aid them in conversion.
This marketing attribution model is highly accurate because it delves deep into your business strategy. It doesn’t always consider all touchpoints involved in the process but rather the most effective ones.
Of course, custom attribution requires a deeper understanding of marketing and is thus the most difficult one to implement. Therefore, it’s a good option for large businesses and companies with complicated and hard-to-track sales funnels. It is not as suitable for smaller businesses with very few conversion steps.
Benefits of Marketing Attribution
Let’s look at some of the biggest advantages of marketing attribution:
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Discover how customers find you: Marketing attribution shows you the channels that drive the most ROI, helping you rule out channels that don’t convert and only use up your resources.
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Improved customer experience: Marketing attribution reveals your customers’ pain points and addresses them throughout the customer journey. This makes your audience feel more connected to your brand instead of being reduced to a number.
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Intuitive advertising: Businesses should research how different customer profiles search and buy products before resorting to pushy advertising tactics. Marketing attribution can help you determine the right advertising channels for your audience by showing you what naturally drives them to conversion.
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Data-friendly: Marketing attribution heavily relies on data, so you can use it to improve sales regardless of the size of your company. Even the most complicated sales funnels find value in attribution marketing, helping you pick the right conversion channels.
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Adaptability: By collecting and analyzing data from your marketing attribution report, you can reallocate your budget more efficiently. This will reduce costs and thus improve ROI.
Measuring Success in Marketing Attribution: Key Metrics
It helps tremendously to have set KPIs for your marketing attribution campaign. Before starting your campaign, consider the following:
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Your end goal. Do you want to get ad clicks or impressions?
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Your marketing channels. Where do you want to promote your business, and how?
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Your budget. How much are you willing to spend on your campaign?
The answers to these questions will help you choose the right KPIs. Here are some metrics you can use to evaluate the effectiveness of your strategy:
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ROI (Return on Investment): This KPI takes into consideration the cost of your entire campaign and how it compares to the revenue.
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CAC (Customer Acquisition Cost): This KPI shows you the cost of a single customer. You can calculate how much you spend per every new customer you get by dividing the total marketing costs by the number of new customers.
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Conversion rate: This KPI shows you the total number of converted customers from your campaign. Conversion can refer to any desired action taken by a user (impression, click, purchase, etc.). We can say that CPC (Cost per Click), CPL (Cost per Lead), and CPA (Cost per Acquisition) fall in the same category.
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LTV (Lifetime Value): This KPIs shows you how much a customer will spend throughout their lifetime with your business. You can calculate LTV by multiplying the average purchase value by the number of repeat sales and multiplying that with the average customer lifetime. This will help you see whether you’re targeting a clientele that drives good revenue.
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ROAS (Return on Ad Spend): If you’re running ads, this KPI is the best way to calculate how much you’re getting back for every spent dollar. All you have to do is divide the revenue by the cost to get the total sum.
These are just a few basic KPIs most marketers use to measure campaign performance. Depending on your strategy, you might use one or a combination of these.
Common Challenges of Marketing Attribution
The right attribution marketing model can help you address challenges commonly associated with marketing attribution, such as:
Misattribution
This is the number-one challenge of marketing attribution. Since most sales funnels involve various channels (websites, social media, affiliates, and so on), marketers may incorrectly conclude that one channel is more effective than another. However, a multi-attribution strategy can help you keep track of where each lead comes from and the steps that led them to conversion.
Data Integrity
TWhen data is pulled from various sources, it can be difficult to determine its quality and accuracy. Implementing robust attribution software can give you deeper insight into data sources and the option to identify and delete unnecessary data.
Low Brand Awareness
Some marketers focus too much on conversion and not the processes that led to it. Often, brand awareness is a large part of what drives conversion. Customers value personalization and like to have their specific needs met. Thankfully, marketing attribution can help you see how your content and messaging provide value to your audience, resulting in returning customers.
How Offer18’s Marketing Attribution Software Can Help
We briefly covered some of the features of top marketing attribution software. However, that list barely scratches the surface – our all-inclusive marketing software offers some of the following benefits:
A well-designed dashboard provides a clear view of how content strategies are performing, enabling quick decisions and adjustments. It promotes teamwork, aligns with business goals, and supports ongoing improvement in marketing tactics.
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Click tracking: You can automatically calculate ad spending by keeping track of every click.
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Conversion tracking: Find out how each click leads to conversion for better optimization.
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Multi-metrics analysis: Use 80+ metrics to follow and measure the success of your campaign.
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KPI analysis: Instead of doing manual calculations, you can automate KPI measurement with software.
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Custom templates: Finally, you can save a template from a successful campaign you’d like to use again in the future, saving you precious time. Or, feel free to use one of our premade templates!
In addition to this, the Offer18 marketing software will lead your campaign from start to finish. Discover target audiences, schedule ads, include pre-landing pages, perform multi-level cost capping, and more!
Ready to get started? Click here for a free trial and see what our software can do for your business.
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