How Do You Measure Marketing Attribution?
Very often the focus in marketing is heavily loaded towards the front end of the process – defining campaign objectives, choosing the right channels to reach your audience and working on getting your creative messages out to market.
And how to measure marketing attribution, and marketing ROI measurement, gets bolted on as an afterthought.
However, all the good work above counts for very little if your marketing measurement systems can’t show how your marketing spend (and efforts) are impacting the bottom line.
Which is where marketing attribution and marketing effectiveness measurement comes in.
In this blog, we dig into:
- What is marketing attribution and why do we need it?
- A quick overview of attribution models
- The benefits of effective attribution
- Some of the current challenges with measurement and attribution
What is marketing attribution?
Marketing attribution is the process of allocating value to the marketing interactions with customers as they make their way to a sale or other type of conversion.
It is concerned with unravelling the increasingly complex customer journeys, both on and offline, and across a wide range of devices from laptops to mobile phones. And putting in place a digital marketing measurement model that can work out which of your marketing activities are really driving conversion and revenue.
Why do we need it?
Quite simply without effective marketing measurement and attribution it is impossible to accurately assess the true revenue and ROI impact of your marketing efforts. Which has major implications for control over budgets, the ability to optimise media spend effectively and potential loss of credibility with key stakeholders in your business.
A quick overview of attribution models
Due to its very nature there are a plethora of approaches that address how to measure marketing attribution and if you are interested in the detail then head over to our comprehensive guide to attribution models.
But here is a quick summary of the various options available to you:
Single-touch attribution models
Largely driven by the advent of multiple digital channels and need for better measurement in marketing, these types of models were developed in the late 1990s. And were driven by their use in solutions like GA and Adobe.
They are predicated on marketing effectiveness measurement that allocates 100% of the credit for conversion to a single marketing touchpoint.
There are two types in this category, as follows:
- Last-click attribution – in this case, credit is allocated on the basis of the last touchpoint prior to purchase or revenue. With no credit given to any other interactions along the way
- First-click attribution – takes a similar approach to Last Click but turns the concept on its’ head. With 100% of the credit going to the first touchpoint in the buying journey
While these approaches may have use cases in very simple marketing funnels, or where you have a focus on measuring the impact of conversion at one part of the funnel, they provide gross over-simplifications on the impact of multiple touchpoints. On what are increasingly complex journeys.
Multi-touch attribution models (better process with a bit of guesswork)
Frustrations with the limitations of single-touch models has also led to the development of a number of rules-based multi-touch attribution models including:
- Linear – gives each touchpoint equal credit for conversion
- U-shaped – provides strong weighting of 40% to both first and last touchpoints with 20% allocated to points in between
- Time decay – allocates higher values to touchpoints closer to conversion
- W-shaped – first-touch, lead conversion and opportunity creation are allocated 30% each with 10% being shared by other touchpoints
- Custom – as the name suggest you choose the weighting based on your own specific marketing needs
However, these models – and more sophisticated versions like Media Mix Modelling – suffer from the same common flaw.
The weightings they rely on are based on marketers’ best guesses around conversion impact – which means their marketing measurement and attribution outputs are wide open to being wrong.
Frustrations with these types of limitations have led to the development of AI and Machine learning driven attribution solutions. That provide a much more accurate level of attribution which works at an individual Visit Level.
Related: What are Attribution Models? A Complete Guide for Marketers
What are the benefits of effective attribution?
Some of the key benefits include the face that with effective attribution you can:
Assess marketing effectiveness & ROI
One of the most famous advertising quotes of all time was by John Wannamaker an advertising pioneer at the turn of the 20th Century, who said:
Half the money I spend on advertising is wasted. The trouble is that I don’t know which half.
His quote is as relevant for advertisers today as it was then.
Effective attribution enables marketers to overcome this challenge – and ensures you get an accurate view of what is, and isn’t, working in your marketing mix at range of levels including:
- Individual creative
Which you can then use to drive effective marketing ROI measurement.
Cut out advertising waste
With digital advertising spend projected to top £600 billion in 2022 the need to ensure that you are spending marketing budget in places where it is effective is essential to avoid the high cost of waste.
Effective attribution solutions address the issue of how to measure marketing attribution effectively and highlight areas of wasted spend.
As well as providing alternative suggestions for you to redeploy spend to channels and campaigns where it will contribute more effectively to your ROI.
Link marketing spend directly to growth
Effective attribution also involves putting in place a digital marketing measurement model that enables you to tie what you are doing on the ground directly to business growth. Which is non-negotiable right now.
Keep full control over the nature of marketing spend
And the knock-on effect of this is that you stay in control of your budget and where it is spent.
At a time when budgets are being put under the microscope, more than at any time previously, this enables you to ringfence and protect spend.
Some of the current challenges with measurement and attribution
However, we believe that marketers are facing a number of unique challenges to effective attribution right now including:
- Reduction in budgets and increased need to prove ROI – pressure on proving ROI isn’t a new problem. However, research from the World Federation of advertisers (WFA) indicates that 73% of marketers feel the downturn is affecting budget decision-making, which is only driving up the pressure to justify marketing spend to CFOs.
- Looming impact of the end of third-party cookies – like it or not third-party cookies are going away (in 2024 according to the most recent target date set by Google). And the implications for ad personalisation and targeting (and retargeting in particular) are huge – as third-party cookies on over 60% of the browser market will disappear almost overnight
- The need to move to GA4 – a number of legal challenges and concerns around the legality and GDPR compliance of GA have been contributing factors in Google fixing a date for sunsetting GA Universal. And requiring marketers to move to GA4 with all of the issues around lack of portability of data
Related: Everything Marketers Need to Know about GA4
- Concerns around platform bias in attribution reporting – according to our own research 80% of marketers are concerned about the issue of bias in their AdTech reporting. And our own work with clients validates their concerns. In the example on the right, our Corvidae platform found that revenue being reported by Facebook of £450,000 was actually closer to £250,000. A trend that we see across the board.
- Underlying issues with the data being used for attribution – and leaving aside the decision on which attribution model you should adopt, there is the underlying issue of the poor quality of data that is being fed into attribution models. With 80% of this data being shown to be incorrect
Related: Poor Quality Data is Hurting Your Attribution. Here’s How…
Need better attribution and improved ROI from your spend?
The first step is to get a feel for how better attribution could improve your marketing effectiveness.
Find out how much ROI you can unlock with our Corvidae platform by using our ROI calculator to identify wasted spend and gaps in your marketing mix.
Looking to unlock greater ROI?
Try our ROI calculator to discover areas of wasted spend in your marketing mix.
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