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Understanding and tracking the performance of your ad campaigns is essential to optimize their success. However, determining which campaigns are driving conversions can be challenging.
This is where marketing attribution comes into play. It helps you understand which campaign, channel, or even specific ads are driving the most conversions so that you can make data-driven decisions about where to invest your advertising budget.
What Is Attribution?
Attribution is a way of measuring how each touchpoint in a customer’s journey contributes to a conversion. It allows marketers to identify the channels and campaigns driving the most conversions and those that may not be performing.
By analyzing this data, marketers can get a clear view of their customer's buying behavior and make informed decisions about allocating their budget.
History of Paid Media Tracking
Paid media tracking has been around since the early days of marketing. Initially, most tracking was done manually by counting impressions and clicks on ads and seeing which led to sales or signups.
Over time, more sophisticated methods, such as URL tagging and pixel-based tracking, have been developed, allowing more accurate campaign performance measurement. With these tools, marketers now have unprecedented visibility into their customers' journeys across multiple channels and devices.
Why Is Attribution Important?
Accurate attribution is critical for any successful paid media strategy because it helps determine where your money is best spent.
By understanding which channels and campaigns are driving the most conversions, you can adjust your budget accordingly to maximize ROI while ensuring that you don't overspend on ineffective strategies or underinvest in those working well.
Additionally, by measuring conversion rates over time, you can easily spot trends in customer behavior that may indicate changes in market conditions or consumer preferences - allowing you to adjust your strategy accordingly.
The benefits of accurate attribution don't just stop at optimizing your budget; it also helps you understand which ads resonate with your customers and which ones need to be retooled. By analyzing the performance of individual campaigns, you can quickly identify areas for improvement and make timely changes to ensure that your ads always remain relevant.
Different Attribution Models
Now that we've established why attribution is important let's look at some of the different models available.
First Touch Attribution
Under this model, credit for a conversion is given to the first interaction with a customer regardless of any subsequent interactions they may have had with other ads or content before completing the conversion action (e.g., making a purchase).
Last Touch Attribution
As its name implies, this model assigns credit for a conversion solely based on the last interaction with the customer before them making the purchase (e.g., clicking an ad). This model ignores any previous interactions they may have had before reaching this point but still gives insights into which channel was most effective at driving them toward conversion at the end of their journey.
It's important to note that this does not necessarily mean it was initially responsible for getting them there. Still, it was responsible for pushing them over the edge when they were ready!
This model assigns equal credit across all touchpoints leading up to a conversion regardless if those touchpoints occurred earlier or later on in their journey (e.g., if someone clicked 3 ads before converting, then each ad would receive 1/3rd credit for that conversion).
This model works best to get an overall sense of which channels contribute most effectively toward conversions. However, it does not provide much insight into attributing exact amounts due to its equal distribution approach.
This model gives most of the credit to the first and last interactions with a customer, with lessening amounts of credit assigned to each interaction in between (e.g., if someone clicked 3 ads before converting, then the first ad would receive 2/3rds of the credit while each subsequent ad would get 1/6th each).
Time Decay Attribution
This model gives the most credit to interactions closest to a conversion (e.g., if someone clicked 3 ads before converting, then the ad they clicked right before converting would receive the most credit while each of the earlier ads would get less). It's important to note that this does not necessarily mean it was responsible for getting.
This model uses data-based algorithms to assign credit across all touchpoints leading up to conversion based on their contribution and the overall customer journey (e.g., if someone clicked 3 ads before converting, then each ad could receive different amounts of credit depending on how influential it was in driving them towards conversion).
Choosing an Attribution Model
Now that you're aware of the different attribution models available selecting the one that best meets your needs is important.
Consider the type of insights you are looking for and how each model will affect your budget allocation before making a decision.
Also, remember that no single model is perfect, and it may be beneficial to utilize multiple models in combination to get a more accurate picture of your customer’s journey.
Finally, continually monitor the results and adjust accordingly, so your ads remain relevant.
Attribution Tools & Software
Attribution tools and software help marketers make sense of all the data accumulated from their digital activities. These tools can track activity across multiple channels and assign conversion credit based on the selected attribution model.
Additionally, they provide reporting capabilities so marketers can easily identify opportunities for optimization within their campaigns.
Popular attribution platforms include Google Analytics, Triple Whale, Rockerbox, and Northbeam.
Investing In Attribution Tools
Although attribution tools and software can be very beneficial in helping marketers better understand how their campaigns are performing, they come with a cost.
Before investing in such solutions, ensure that you have the budget to cover it and that your campaigns are at a stage where tracking conversions is important.
We recommend that you explore attribution tools when you’re spending across multiple channels, need to monitor omnichannel results, and are spending $50k/month in media or want to scale your media spend quickly.
Common mistakes & challenges
When implementing attribution models, it's important to consider several things to ensure accuracy. Here are some of the common mistakes and challenges marketers need to be aware of:
- Not properly aligning campaigns & tracking codes – Ensure that all your campaigns have unique tracking codes so you can quickly identify which ones are performing best.
- Not utilizing the right attribution model – Choosing the wrong attribution model can lead to inaccurate results. Be sure to select one that best meets your needs.
- Not accounting for customer journey complexity – The longer and more complex the customer journey is, the harder it becomes to assign credit accurately.
- Not verifying data accuracy & integrity – Data accuracy and integrity are vital to ensuring your attribution models are accurate. Be sure to audit your data for any discrepancies regularly.
Accurately attributing credit towards conversions is essential if you want your paid media efforts to succeed. Otherwise, you could be wasting valuable resources on strategies that need to be fixed.
By understanding the various attribution models and methods, marketers can gain deeper insights into what exactly drives conversions so they can adjust their strategies accordingly.
Additionally, investing in proper tools & software will help ensure accuracy when measuring campaign performance & attribution results, so it's worth considering if you're serious about optimizing your paid media efforts!
Want to understand better how attribution modeling and software could help you scale your brand? Talk to our paid media strategist today.