So, people are buying your products and services, but how many touchpoints did it take to get them there? And which touchpoint was the deciding factor?
With an attribution model in place, you can analyze every touchpoint that transforms leads into conversions. That way, you’re never unaware of what triggers your customers into making a purchase. It’s the path to more closely understand your buyer’s journey. And when you know each step of your purchasing process in detail, you can significantly improve your marketing process.
Consequently, having the right attribution model will help you determine how to allocate your funds when updating your marketing budget.
In this article, we’ll explore the following:
- What is an attribution marketing model?
- How vital is an attribution marketing model for your business?
- What are the benefits of attribution marketing models?
- Attribution marketing model types and which one you should use
What is an attribution marketing model?
Attribution modeling helps you visualize and better understand your buyer’s journey. It gives you insight into each touchpoint, or marketing channel, that leads customers to the ultimate goal: making a purchase. When you have an attribution model in place, it gives you a greater idea of how your marketing efforts should be improved to streamline the buyer’s journey and essentially enhance your sales. Further, attribution models provide you with foresight on spending, assisting you in your marketing budget process.
In short, attribution marketing models rank each touchpoint a customer encounters before pressing the “buy now” button. It’s a great way to distinguish which touchpoints are most crucial to your sales process.
How vital is an attribution model for your business?
Most online companies have marketing strategies that help them create a successful sales process. Yet, those same companies, though investing a significant amount of time and money in their advertising campaigns, often forget the importance of evaluating the strength of each touchpoint that leads to conversion.
Think of it this way: if a customer receives an email, then sees a banner ad, but converts after seeing an Instagram sponsored post, which touchpoint weighed the most in the customer’s decision?
All three touchpoints likely influenced the sale, but it’s understood that the Instagram ad should be attributed a little more weight in this instance. So does this mean that you should spend more on your Instagram ads?
Based on one sale? That’s unlikely. However, if the pattern looks similar for many clients, you’ll have more certainty (data) as to which channel or touchpoint works best.
Attribution models are essential for your business because they can shed light on how your marketing teams are performing and what factors turn leads into customers. Furthermore, it’s important because it can help you measure the success of your advertising campaigns and figure out how much you’re spending to convert a lead.
What are the benefits of attribution models?
Getting your attribution model right is challenging, especially if your company has a complex marketing process. Still, finding the attribution model that suits your company’s needs can drastically benefit your marketing effort. One of the most apparent benefits is that you’ll gain an infinitely more succinct understanding of your sales funnel. You’ll know how each conversion occurs in detail, making you a better-prepared marketer. But that’s not all. Attribution models can yield other notable results:
- Improve marketing budget planning
- Help marketers determine which campaign works best
- Give insights into the buyer’s journey
- Determine the cost per acquisition
- Increase marketing ROI
- Control marketing spend
- Improve personalization
Attribution models are vital tools for analyzing the effectiveness of your marketing campaigns. Use them well, and you’re in control of your sales funnel, use them poorly, and you’re not squeezing the full potential out of your marketing effort. This leads us to our next section, where we explore model types and try to find the one that best suits your company.
Attribution Model Types: Finding the right one for your business
There are many types of attribution models. Finding the right model depends on your company’s size, goals, and marketing strategy. Let’s explore the most popular attribution model types.
Single-touch models are helpful for businesses with few touchpoints in their buyer’s journey. Examples of single-touch attribution models include first-touch and last-touch models.
A first-touch attribution model only considers a customer’s first touchpoint with your brand. Using this model, you assume that your customer came into contact with your products or services and made a purchase on that first and only interaction.
A last-touch attribution model only accounts for the touchpoint that converted the customer. This model ignores any initial touchpoints in the buyer’s journey.
While single-touch attribution models can help pinpoint which touchpoint led to conversion, they do not draw a precise map of the buyer’s journey. Therefore, the single-touch modeling approach may not be the most adequate if you run various marketing campaigns.
Multi-touch models work best for businesses juggling multiple marketing campaigns on various channels. Finding the right model for your business will depend on what data you’d like to acquire from your buyer’s journey.
Linear attribution models consider the entire customer journey from the first to the last touchpoint. This model weighs each touchpoint equally. This means that every touchpoint equally contributes to a conversion.
Though this model acknowledges the entire buyer’s journey, which is more inclusive than single-touch models, it does not show you which touchpoint influenced customers most.
Time-decay attribution models look at each touchpoint incrementally. The weight of each touchpoint is increased equally from the first to the last. This model assumes that the customer’s interest grows after each touchpoint.
This is an excellent way to imagine the quintessential buyer’s journey. However, it’s unlikely that a buyer’s journey would ever be that simple.
Data-driven attribution is the most inclusive model to date. Instead of attributing values based on the order of the touchpoints in a buyer’s journey, this model analyzes the entire journey and looks for patterns that indicate which ad, or touchpoint, leads to more conversions. It’s the only model on this list capable of weighing each touchpoint accurately, making it the superior model for companies with complex marketing strategies.
The only drawback is this: according to Google Analytics, the minimum requirement for accurate data-driven attribution is 600 conversions per month.
Finding the right attribution model for your business
Deciding which attribution model to use depends on your sales cycle’s length and complexity and your number of monthly sales. No companies are alike, so it’s impossible to say which model is most suitable for a given company.
In today’s omnichannel marketing world, there isn’t a one-size-fits-all attribution model. Your marketing team should look for a model that precisely fits your company’s needs. The most suitable option is to combine various attribution models to create a custom model that works with the type of data you’d like to acquire.
From planning your marketing budget and increasing marketing ROI to improving the buyer’s journey and determining the cost per acquisition, attribution models are an essential part of the marketing process.
Once you find a model that suits your company’s needs, it becomes a force that benefits every aspect of your marketing effort. Indeed, time invested in your attribution models is time well spent.
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