How do you drive growth if you don’t know where to allocate your marketing dollars? In an increasingly fragmented marketing landscape, this question is more important than ever. The answer is with multi-touch attribution.
Shopping patterns aren’t as simple as they used to be. With the advent of new digital channels and technology, shoppers have become more sophisticated and have shorter attention spans — adding a healthy dose of complexity into once linear customer journeys. On average, it takes 56 touch-points for a customer to make a purchase, which is why the industry has made a shift towards more comprehensive forms of marketing measurement.
If you’re a marketer driving for conversions, you’re probably using an attribution model — you just might not know it.
Single-touch attribution models are easy to implement and popular because of their ties to Google Analytics. However, they assign 100% of conversion credit to one marketing touchpoint, which does not provide space to evaluate the impact of each individual touchpoint leading up to a conversion.
When you think of it like that, it doesn’t make sense to blindly assign “credit” to touch-points without rhyme or reason. You’re already doling out money to different channels anyway, so why not be that savvy marketer and start measuring to see what’s effective?
Multi-touch attribution models have become the new gold standard for determining appropriate credits for customer touch-points because they enable marketers to gain a better understanding of how different channels and interactions contribute to the marketing process.
Although multi-touch has generally been accepted in recent years as superior and more accurate than first-touch and last-touch methods of attribution in advertising, how each touchpoint is credited can vary depending on your organisation and goals. Here are some key considerations for designing effective and customised multi-touch attribution models.
The Why and When of Using Multi-Touch Attribution Models
While it may be easier to simply use Google Analytics for free and operate off of their last-click model to explain where conversions are coming from, that’s not how the customer journey works anymore.
Multi-touch attribution allows you to identify more than just the channels that perform well at a single touchpoint. The real power of multi-touch attribution is enabling a marketer to understand how channels work together to influence customers to visit your site and purchase. Additional benefits include:
Better insights into your marketing efforts and campaigns
A higher return on marketing investment
Better insights into your customers’ journey to buying your products
Multi-touch attribution evaluates the impact of each touchpoint leading up to a conversion. Using this method, marketers can get an in-depth look into the consumer experience and devote funds to the channels that provide the highest ROI. You’re probably already using multi-touch attribution because marketing doesn’t exist in a vacuum. However, you know you’re ready to begin using multi-touch attribution if:
You use multiple digital ads and ad networks.
You need to show how your marketing is producing results.
You use or are considering using offline channels, such as print media, trade shows, etc.
You’re considering or implementing SEO best practices.
You’re frustrated with your current methods of tracking your marketing.
You need a new way of marketing that reaches your consumers in the competitive marketplace of today.
Determining Your Multi-Touch Attribution Models and KPIs
It’s important to determine which multi-touch attribution models work best for your company and determine appropriate portional credit for each touchpoint. You can choose from several standard models or create your own from scratch. The option you select should be informed by variables such as the length of your sales cycle, the types of campaigns you are running, and your Key Performance Indicators (KPIs). There are plenty of models to work off of, but here are a few common ones:
Linear attribution is the simplest form of multi-touch attribution. It assigns equal value to all marketing touch-points in the customer journey. Pro: It demonstrates how each point has value. Con: It doesn’t offer the amount of insight that other approaches do.
Time decay gives more credit to the touch-points closest to the time of conversion, meaning less credit is given to the first interaction. Pro: It’s good for relationship-building. Con: It’s less suitable for shorter sales cycles, which isn’t helpful for most D2C brands.
Position-based / U-Shaped methods put more weight on the first and last touch-points — assigning 40% credit to each — and splitting the remaining 20% between the touch-points in the middle. Pro: It gives credit to all touch-points, but specific key interactions are more weighted. Con: It doesn’t consider marketing efforts beyond lead conversion.
W-Shaped model follows a very set pattern: 90% of the credit is evenly split between the first, third, and last marketing touch-points. The remaining 10% is divided between the second and fourth touch-points, hence the “W” shape. This model attributes the most value to the three main customer journey stages: visit, lead, and sale. Pro: It gives credit to all touch-points, but specific key interactions are more weighted. Con: It doesn’t touch on points outside of the first, middle, and last touch-points.
If none of these models make sense for your company, you can create a custom model. Custom models give you precise control over how you distribute credit for conversions, setting the weight and significance of each touchpoint based on considerations unique to your business. They also allow you to account for idiosyncrasies in your customer journey to optimise your ad budget allocation. However, developing custom models is resource-intensive. For most, it’s easier to use the readily available pre-built attribution models.Some advanced multi-touch attribution models leverage machine learning to assign partial or incremental credit to predict the value that each touchpoint added. You can learn more about algorithmic multi-touch attribution models here.
Choose Software that Fits for Your Needs
By using algorithms, software trends, and intuition, companies can measure data and track results. While marketers often turn to platforms such as Google and Facebook to measure attribution due to their popularity, these platforms have limitations because they report and track conversions differently and their measurement scopes are limited.
Google Analytics only tracks Google ad networks like Google Display Network and Google Ads, which means it doesn’t take into account impression-based interactions with digital media or traditional media that leads to a branded search. In contrast, Facebook advertising does account for view-through conversions, and they measure both clicks and impressions. However, neither of them is a true multi-touch attribution tool as they focus on their own advertising channels.
So, where do you go? The next step is to search for a marketing attribution software that’ll enable you to measure more than just clicks, gather conversions from individual platforms, and blend them to get valid overall conversion-data.
Consider software tools that manage and track complicated multi-touch attribution models. Useful tools will include an easy to use and understand analytics dashboard, as well as a reporting mechanism that offers both high-level and granular detail about the performance of each channel and touchpoint.
Even better, look for solutions that offer the ability to see how customers behave and interact with your brand across multiple channels. Having a centralised dashboard provides the accurate insight needed for cross-channel analysis. Remember, data by itself is inherently useless — driving to actionable insights is the ultimate goal for any business.
Apply Customer Insights and Continue to Optimise
Multi-touch attribution isn't a set-it-and-forget-it activity. For it to be effective, it’s critical to test, analyse, and further optimise and customise your model to inform your marketing efforts and ensure you reach the right consumers at the right time.
According to McKinsey partner, Kelsey Robinson, as your company becomes more comfortable with multi-touch attribution models, you may want to run several at a time to see which campaigns generate the best results at the top, middle, and bottom of the funnel.
Robinson says, “The purpose of multi-touch attribution is to help marketers invest in those experiences that are proven to drive growth…the reality is that marketers tend to have an incomplete (even false) understanding of what motivates their consumers. Multi-touch attribution models can help them understand to a much greater degree of certainty what role certain marketing exposures have on broad and deep segments of consumers.”
Successful marketers are constantly deepening their insights and leveraging data to test their efforts. A testing framework built on a strong foundation of key learnings will do wonders for your marketing, customer relationships, and bottom line.
As with any data model, it’s important to remember that the ultimate goal is to gain a better understanding of the intersection between the customer and your business. This level of insight gives savvy marketers a leg up when improving customer experiences, and ultimately, increasing customer lifetime value (CLV).
With the constant influx of new learnings and findings, it’s an absolute must to keep close tabs on what is and isn’t resonating to ensure the bond between customers and your business strengthens over time. Customers crave positive brand experiences, with 55% of US shoppers stating they would stop buying from a brand after a single, bad customer experience.
With the help of multi-touch attribution models and a tailored approach to crediting each touchpoint, your company will be on its way to maximising revenue growth and gaining a deeper understanding of the most critical interactions that your organisation has with its audience.