Choosing the right attribution model for your business
You’re engaging with customers on multiple channels. Now you need to monitor and discover how well that’s working. But with so many different touchpoints in the customer journey, it can be hard to understand each channel’s true value and how they work together.
While it can be tricky to know for sure where a conversion came from, a marketing attribution model can help. There are many kinds of attribution models you can use, but knowing how to choose the right one for your business might be the hardest part.
In this article, you’ll learn:
- What marketing attribution models are
- Why marketing attribution models matter
- Types of attribution models
- How to choose the right one for your business
- Marketing attribution tools
- How to get started
What are marketing attribution models?
Attribution, or assigning credit for sales, is a basic marketing concept, but it gets more complicated with multiple channels and longer customer journeys. It’s unusual for new customers to head straight to your site and make a purchase after seeing an ad.
In both B2B and B2C, customer journeys are becoming more complicated. People usually encounter multiple ads for the same company on different social media platforms, billboards, or podcasts. They might walk into a store or do a search on their phone and then sign up for emails from a work computer. We know it can take at least five touches, or many more over a period of months, to generate a sale, and these touches can be overwhelming to track and understand accurately.
Marketing attribution is the practice of tracking and analyzing the value of multiple touchpoints or marketing channels. It can help you find out if and how each of these is working at bringing in prospective customers and closing sales.
Marketers have different theories about the best way to attribute value, and they have developed several models to apply those theories. A marketing attribution model is a predictive or analytical framework that can be applied to any marketing scenario. It helps track the multiple touchpoints customers go through on their buying journeys.
Why do attribution models matter?
Attribution models allow you to work smarter — not harder — because you can discover where your efforts are best spent. They can help you make budgeting decisions and improve marketing campaigns.
- Budgeting decisions
Attribution modeling can help you understand:
- The ROI for each marketing channel or customer touchpoint
- Where to invest or reallocate funds
- The most effective ways to manage your marketing budget
- Campaign improvements
Attribution modeling can help you understand:
- How various channels align with the customer journey
- Where to make improvements in marketing campaigns
- How to tailor your marketing campaigns and content to your unique personas
Most importantly, using marketing attribution models will help you reach more prospective customers because you know where your strategy is hitting its targets and which areas have potential growth. Identifying the places where you lost customers along the buying journey will give you the most insight into how you can improve your marketing channels.
Types of attribution models
There are two main types of marketing attribution models — single-source and multi-source.
A single-source model assumes that credit can be given to just one channel or touchpoint, while a multi-source model seeks to understand the influence of all possible touchpoints.
Attribution models work best when they’re properly matched to your business needs. For example, if you’re looking to track top-of-the-funnel marketing conversions, you will likely rely on single-source attribution modeling. Each type has different variations, and each variation has pros and cons (or optimal use cases).
Single-source marketing attribution models
Single-source attribution models assign credit to one marketing touchpoint only in the buyer’s journey.
There are two main single-source attribution models.
- First-touch models assume that customers converted after the first marketing asset they encountered. It gives full credit to this first touchpoint, regardless of any other channel interactions.
Because it shows which marketing methods catch the eye of new customers, this model is a great option for when you want to understand top-of-the-funnel buyers.
First-touch models fail to account for any customer interactions after the initial touch, and they might unfairly bias marketers against other channels. For example, the channels that perform well in this model might earn website views but not sales.
- Last-touch models give full attributive credit to the customer’s last interaction before making a purchase (without accounting for prior engagements). This type assumes that customers converted after the final marketing asset they encountered and gives full credit to the final touchpoint, regardless of prior messaging.
This method is useful when you want to know what drives your customers to action, even if it’s after they have been primed through other channels.
These models fail to account for any customer interactions before the final touch, so you have no idea how much those other channels might have influenced the final outcome.
Multi-source marketing attribution models
Multi-touch attribution modeling aims to assign the right amount of value to each touchpoint or channel that the buyer encounters. These models are often considered more accurate because they assign value to all points (not just one) along a customer’s journey.
One of the challenges in attribution modeling is that it’s not always possible to truly know each channel’s contribution. Offline sources like word of mouth and brand equity can have an influence that is impossible to calculate. And the decision-making process is psychologically complex. Even if you survey customers to ask what most influenced their buying decisions, they might not be aware of all the factors or remember how many times they encountered certain messaging.
Despite these challenges, multi-source models aim to put together the pieces of the puzzle in different ways. There are several types of multi-source attribution models that can be used for different purposes or levels of complexity.
- Linear models consider every interaction, but they divide the credit evenly. No matter where it happened chronologically in the customer journey, the touchpoint gets equal credit.
Use this model when you want a broad picture of your marketing strategy and a general accounting of all channels.
- Time decay models give increasing weight to interactions that happened later in the buyer’s customer journey, with the greatest credit given to the final interaction that led to a sale.
Use this model when you are most interested in the channels that drive conversions or work better at the bottom of the sales funnel — and when you want to place less emphasis on the top of the funnel but still want to account for all channels.
- U-shaped models give 40% of the credit to the first interaction and another 40% to the last. The remaining 20% is split between the second and next-to-last touch — or, alternatively, evenly across all intermediate touchpoints.
Use this model when you want a balanced approach or when intermediate stages of the decision-making process are more difficult to ascertain, but you still want to consider their influence.
- W-shaped models spike at three points like the letter “W.” Those three peaks represent three touchpoints or events — the initial visit, the lead conversion, and the opportunity creation. These each get 30% of the credit. The remaining 10% is split evenly between the touchpoints that occur in the two low intervals.
Use this model when you want a detailed view of all channels along the customer journey. It can help you identify how channels are interrelated and which channels are more effective at different stages.
Choosing the right marketing attribution model for your business
The model you choose needs to fit your business, so it’s important to choose carefully. The decision will depend on your company’s goals and budget. It will also depend on the type of messaging that your marketing team has chosen. Selecting and using the right model depends on keeping all those factors in mind.
As you consider the kind of analysis you need from your attribution modeling, it’s important to ask the right questions. Those questions can include:
- What does your average sales cycle look like? How long does it run? Are there built-in considerations for offline conversions?
- How do customers learn about your brand?
- Why do customers typically drop off in the buying journey?
- What makes these customers return?
- What leads customers to finally make a purchase?
Marketing attribution tools
Even with an idea of which model might work best for your business, the process of applying the model and analyzing the results can be complex. It’s important to select tools and platforms that can centralize metrics and generate dashboards to get the best data possible from your marketing attribution models. And there are many resources available that can help you optimize your marketing channels.
It’s just as important to select the right tools as it is to select the right model. Consider whether:
- The tool properly integrates with the technology available at your business
- You need a tool that allows for online and offline conversions
- You need a tool that calculates the ROI, LTV, or any other specific data analysis
- Your business needs an automated solution for your attribution models
Get started with marketing attribution modeling today
With a basic understanding of attribution modeling, you are better prepared to select a model that helps you understand how to allocate marketing budgets, improve campaigns, and bring in more prospective customers.
With the right model, you will have a better grasp of how different touchpoints are influencing your customers and where to assign credit for leads and sales.
When you’re ready to implement a model and analyze the results, having the right tools can help. Adobe Audience Manager includes analytics that can help you create and activate the best audiences on any channel or device.
Learn more about real-time data insights, audiences, and activation— and start turning insights into action today.