Marketing attribution is something every marketer knows they should be doing, but doesn't know how.
It's not for lack of trying - data suggests that more and more marketers recognize the importance of attribution models. According to Think with Google, 3 out of 4 marketers (76%) say they currently have, or will have in the next 12 months, the capability to use marketing attribution.
The challenge is that there's no golden rule for attribution. There are multiple types of attribution models you can use, and nobody can agree on the best one. It completely depends on your unique campaigns, goals and business.
The best thing marketers can do is educate themselves on the types of attribution models in order to make an informed decision.
That's what this guide covers.
What is attribution modeling in marketing?
The goal of attribution modeling is to give a better understanding of how different channels contribute to your ROI.
It's easy to think that a user clicks on a Facebook ad, and immediately converts into a sale or lead.
But that's very rarely the case.
The reality is that people go through a whole journey before they convert. They might see your offer in an email before seeing an Instagram post, then find your blog post, and a few days later click on a retargeting ad. Only then will they finally convert.
The big question for marketers is: which channel gets the credit?
Was your email responsible for the conversion? After all it was the first thing they saw.
Or was it your blog post?
Or perhaps the retargeting ad which led them to your website for that final conversion?
Attribution helps you assign credit to one or all of those touch points, so you can accurately plan future campaigns.
Why is marketing attribution important?
The ultimate goal of using marketing attribution is to give you the insights you need to optimize the allocation of your marketing spend (and therefore ROI) by focusing on those channels that most influence conversions.
Understand the buyer's journey
Image source: Hubspot
The buyer's journey is far from linear. Also, your buyer's journey will probably look nothing like that of another business.
The most important question to ask is:
Are your marketing channels aligned to your buyer's journey?
Take this example of a buyer journey:
Image source: Content Marketing Institute
Mapping your buyer’s journey allows you to identify which channels have the most influence over conversion.
That's where marketing attribution can help. It helps you map the touchpoints a buyer has before they convert and, deepening on the attribution model you use, work out how much influence each touch point has on their conversion path.
Determine your ROI and prove the value of digital marketing campaigns
Digital tools, ad spend, resources, agency fees, creative - there's an every-grown list of things you need to invest in for digital marketing. But what return are you getting on that investment?
Company directors speak numbers, and you probably need to be able to show how much your digital campaign tactics are having an influence on sales - especially if you need to build a business case for more marketing budget.
Attribution modeling helps you capture data, interpret it and use it to tell a story of what’s actually happening with your sales and marketing funnel.
Only when you have a true understanding of which channels are working can you effectively allocate more budget to them.
Even more importantly, you’ll be able to stop wasting money and effort on campaigns and marketing efforts that aren’t improving your bottom line.
What are the different types of attribution models?
There are two main types of attribution models:
Single touch models
Multi touch models
Single touch models, as the name suggests, allocate credit to a single touchpoint in the customer journey. It's usually the first touchpoint (when they initially became aware of your brand or first clicked on the offer) or the last (the final push that make them convert).
But there are drawbacks to this approach.
Today's buyer's journey is increasingly fragmented. If you choose to attribute 100% of the credit to any one touchpoint, you’re ignoring the entire buying process and failing to acknowledge the value of each individual channel as part of the whole.
That's why multi touch attribution models are now more popular with marketers.
Multi-touch attribution aims to assign each touchpoint along the customer journey with an appropriate amount of credit, depending on its importance in the journey.
For example, if a person saw your Facebook campaign, then engaged with your email retargeting campaign and read a blog, each of these channels deserve a portion of the credit for the conversion.
The benefits of this are clear. That's why, according to e-marketer, an estimated 84.2% of US companies with at least 100 employees will use digital attribution models of some kind in 2021, with 65.3% using multichannel attribution models.
Types of Single Touch Models
Last Interaction Model
Last Interaction Attribution, aka last-click or last-touch, gives 100% of the credit to the last interaction your lead had with your brand before they converted.
Let's say a visitor finds your product through paid search ads. Then, a few days later they see a Facebook ad, and click the ad.
Later that week, they go directly to your website and buy the product.
Direct traffic was the last touchpoint, and therefore gets 100% credit for that purchase.
Here’s what that could look like:
Image source: PixelMe
Pros of Last Interaction Attribution
Simplest model to implement and evaluate.
For most platforms, including Google Analytics, last touch is the default attribution model. You don't have to do anything to set it up.
If you are using default conversion reports in Google Analytics, you are looking at each goal being attributed to the last interaction your customer had with your business. (Read our Google Analytics Guide to SEO to learn more about reports)
Often the most accurate model.
No matter how complex their journey, last interaction attribution means you can always be certain of the buyer's last interaction before they converted. Some 54% of marketers say that the last-touch attribution model is somewhat effective, according to Ruler Analytics.
Cons of Last Interaction Attribution
Ignores everything else in the journey
Even if it was actually the email nurturing campaign that had the most influence on the buyer to convert, this model ignores it if the email wasn't the final touchpoint.
An alternative to the Last Interaction Model
The Last Non-Direct Click Attribution Model is more effective than a standard last-click attribution model. While the whole value is still assigned to a single interaction, last non-direct click eliminates any "direct" interactions that occur right before the conversion.
Think back to the scenario above where the visitor finds your product through paid search ads then clicks on a Facebook ad before visiting the website direct.
With the Last Non-Direct Click Model, the credit goes to the social ad - not direct traffic.
By eliminating direct traffic, you can better assign value to the channel that led to the conversion.
First Interaction Model
First Interaction, aka first click, gives all the credit to the very first interaction your customer has with your brand.
Let's say a customer first finds your business through organic search, then your search engine optimization gets all of the credit for any conversion that happens after that interaction. Even if your customer goes on to click on a display ad, see a blog article and then visit your site directly.
Take a look at this example:
Image source: PixelMe
Pros of First Touch Attribution
Effective method for measuring digital campaigns
According to Digiday research, nearly half of marketers (44%) claimed the first-touch attribution model to be more effective for measuring digital campaigns.
Simple to use
The appeal of using First Interaction attribution is how straightforward it is. It's simple to use and understand, which is why it's one of the popular attribution models.
Cons of First Touch Attribution
Like other single touch attribution models, this model is too simplistic. The model ignores other parts of the journey that have an impact on conversion.
Types of Multi Touch Attribution Models
Linear Attribution Model
The linear model assigns the same credit to every channel that a buyer engaged with in their journey to conversion.
If they find your brand through organic search, open an email, and click on a retargeting ad, all of those channels are allocated the same amount of credit.
However, while linear attribution shows you what touchpoints were interacted with, it doesn't consider the relative importance of each marketing touchpoint in the buyer journey.
Instead, you split the credit equally.
Image source: Attribution
Pros of Linear Attribution
Balanced look at marketing strategy
Linear attribution considers the whole marketing journey and gives you a more balanced view than a single-touch attribution model does.
Cons of Linear Attribution
Does not allow for varying channel influence
This model assigns equal importance to everything. So even though your SEO may have been more influential than your social media ads on the final conversion, this model doesn't allow for that, which means you cannot see which are your most effective strategies.
Time Decay Attribution Model
Time-based attribution is another multi touch model. The way it works is by giving more weight to interactions that happen closer to conversion.
In other words, unlike Linear Attribution, the Time Decay model takes into consideration when each touchpoint occurred in the journey.
Imagine that a consumer clicks on your paid ad then does nothing for a few weeks.
Then they search on Google for your brand, go to your website and sign up for a free trial.
Because they converted using search, this would receive more credit than other touchpoints along the journey.
Image source: Attribution
Pros of Time Decay Attribution
Good to show the importance of relationship building
If relationship-building is a big factor for your brand, using Time Decay can be a helpful way to show this.
Shows the value of later touchpoints
The later touchpoints are doing the bulk of the work in getting leads closer to the ultimate goal: earning you more revenue. So it does make sense for them to get more credit.
Cons of Time Decay Attribution
Can downplay important touchpoints from early in the journey
If you have a long sales cycle, this model will downplay the influence of touchpoints earlier in the customer journey - even if they were crucial to getting a buyer to consider your brand in the first place. This model gives first interactions the least credit, even though many marketing teams would argue that initial awareness is one of the toughest and most important goals to achieve.
Not the most accurate
Does the sequence really tell you which touchpoints are most important to convincing a lead to become a customer?
Position Based Attribution Model
Position Based attribution (aka the U-shaped attribution model) is another multi touch attribution model. It gives credit to two main touchpoints:
the first interaction with your brand
the lead conversion touchpoint (where they became a qualified lead).
Each of the two touchpoints receive 40% of the credit. The remaining 20% is shared between other touchpoints they interacted with in the middle.
The rest of the credit is then evenly distributed through any touchpoints in between.
Pros of Position Based Attribution
Gives at least some credit to every interaction
This model recognised that every touchpoint has a part to play in conversion, but it gives a stronger weight to your two most important interactions: the first time a customer interacts with you and the interaction that finally prompted a conversion.
Give more credit to awareness and decision marketing tactics
Most marketers would argue that the initial awareness and final decision making activities are the most important and should be given more credit than consideration-level ones.
Cons of Position Based Attribution
Touchpoints in the middle are given the same weight as each other
All those touchpoints in the middle may not be equal in the influence they have on a customer journey. But the credit is split evenly amongst them.
First and last touchpoints are not necessarily equal
Some marketers would argue that the first and last touch points shouldn’t be given any special credit in the journey.
W-Shaped Attribution Model
The W-shaped attribution model adds another touchpoint to the mix:
30% credit goes to the first touchpoint
30% goes to the touchpoint where a prospect becomes a qualified lead
30% goes to the final touchpoint of interaction
Remaining 10% is assigned evenly to all other touchpoints along the way.
Pros of W-Shaped Attribution:
Gives all touchpoints credit
At the same time, it recognises that some touchpoints carry more weight than others.
Give more credit to awareness and decision marketing tactics
Like the Position Based model, the initial awareness and final decision making activities are often seen as the most important, and this model gives them more credit than consideration-level ones.
Cons of W-Shaped Attribution:
Still oversimplifies the buyer journey
Yes, it’s more sophisticated than some other models, but it still oversimplifies the process. This model limits visibility into the mid-funnel consumer interactions that help drive conversions.
Custom attribution models
A custom model is basically where you choose how to assign the weighting to each touchpoint, based on how important it is to your customer journey.
This is arguably the most effective way to attribute conversions and work out your marketing channels ROI, because you can tailor it to your exact needs.
However, as you'd expect, creating your own attribution model can be difficult and requires a lot of data.
How to pick the right attribution model
Some leading marketers will swear by one attribution model, while others will put all their time into another.
But there's no right or wrong answer - the right marketing attribution modeling for you completely depends on your business, your campaigns and your goals.
If you’re selling a high-value product or a B2B service, you'll have a longer sales cycle than if you sell shoes. The means your marketing strategy will be far more complex with multiple campaigns and marketing touchpoints all playing their part.
As a result, single-touch marketing attribution models aren't going to cut it. You need a comprehensive attribution model which shows you the value of each stage of the buying process.
Here's a guide to choosing different marketing attribution models:
Last touch marketing attribution model: If you have a short buying journey or sales funnel, and there aren't many touchpoints before converting, the last touch model will give you the best idea of your strongest performing channels. Around 41% of marketers are using “last-touch” as the most common method for their online attribution, according to Digiday. Most marketers use last-click attribution to monitor the success of their marketing strategies.
First-touch marketing attribution model: Like last-touch attribution, this marketing attribution model works best for businesses with a simple customer journey rather than one with multiple touchpoints. If your business tends to convert customers immediately, their first touchpoint is especially influential.
Linear attribution model: This is a great way to demonstrate how multiple channels have value in your conversions, giving equal credit to each, while still being a simply strategy to use and understand.
Time decay model: Consider a Time Decay attribution model when you're dealing with a long sales cycle, such as for B2B sales.
Position Based model: The position-based attribution model is one of the more complex models, but it is great for businesses that have multiple touchpoints leading to a conversion.
W-Shaped Attribution: This is great for B2B businesses with a clear funnel of marketing channels that prospects typically go through - the model emphasizes the most critical touchpoints in the buying journey: First-touch, Lead creation and Opportunity creation.
Custom attribution: If you have the resources, a long and complex customer journey and plenty of attribution data to work with, you should try a custom attribution model.
Don’t be afraid to experiment and try out different marketing attribution models to determine which works best for your marketing campaigns, and tells the best story for decision-makers in your business.
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