A marketing attribution model is a method for determining which touchpoints are responsible for a sale, as well as how much credit each touchpoint receives. When researching complex products and services online, buyers progress through a series of touchpoints before making a purchase decision. Touchpoints can include social media posts, articles, reviews
Marketing attribution is used by business-to-business (B2B) marketers. Purchases of consumer products (e.g., food and beverage) have fewer touchpoints. As a result, fewer business-to-consumer (B2C) marketers use marketing attribution since product sales often occur via a single touchpoint. B2C marketers with more complex products (e.g., automobiles, home loans) are more likely to use marketing attribution models.
Marketing attribution models help marketers quantify the performance of their marketing channels and content. For example, a marketing attribution model can show that Pay Per Click (PPC) advertising is contributing 60% more to product sales than social media advertising.
The data surfaced by marketing attribution models can help marketers make better decisions about future advertising spend and content campaigns.
Marketing attribution models require a Customer Relationship Management (CRM) system to track customer purchases, as well as a Marketing Automation Platform (MAP) to track touchpoints. Customers may also purchase marketing attribution software, which is typically sold via software-as-a-service (SaaS). Marketers configure the software with the marketing attribution model they wish to use (e.g., first touch, last touch, linear, etc.).
Marketing Attribution Modeling Techniques
Marketing attribution models fall into two categories:
Single-Touch Attribution - 100% attribution is provided to a single touchpoint, often the “first touch” or “last touch.” For example, the first touch may be reading a website article in response to a social media advertisement. The last touch may be reading an analyst report.
Multi-Touch Attribution - Attribution is divided among all touchpoints. Within Multi-Touch Attribution, there are several methods for calculating the amount (e.g., the percentage of the sale) to be allocated to each touchpoint.
Multi-Touch methods include linear (e.g., each touchpoint receives equal credit), time decay (e.g., more recent touchpoints receive more credit than earlier touchpoints) and U-shaped (e.g., 40% assigned to the first touch, 40% allocated to when the lead was created and 20% spread evenly across the remaining touchpoints).
While marketing attribution models are a good proxy for marketing channel performance, they’re not perfect. For instance, first touch or last touch attribution does not assign any credit to important touchpoints that occur in the middle, while multi-touch attribution may assign a value to some touchpoints that don’t reflect their actual influence on the sale. Marketers should consider attribution a good indicator of channel performance, but not a definitive answer.