How to find the right attribution model?
With so many options, it’s not that easy to find out. You probably implement many marketing strategies, but are they the right ones? That is the question you have to answer. In this article, we want to learn how to find the right attribution model.
If the answer is complicated for you, you are not alone. 40% of all marketers have difficulty calculating the ROI of their marketing activities. They do not know which strategies should be prioritized, which should be optimized, and which should be abolished. This is no wonder because there are so many different strategies that you naturally want to try everything out.
This is a problem because if you implement too many strategies at once, you can no longer effectively determine the effectiveness of those strategies and advertising channels. At some point, the sales funnel will look like a pretzel, no longer linear. But if you can’t measure the results of your advertising strategies, then you don’t know which ones will bring the desired results and which will harm your business. You may still be successful but cannot invest in the right strategy to maintain this momentum.
What do you do now?
You have to find a suitable attribution model for each marketing strategy, but first, I must explain what an attribution model is.
What is an attribution model?
An attribution model is a method to determine which advertising channel conversions must be assigned. You can use one or more attribution models to determine which conversion is given to which advertising campaign.
You want to determine if the Facebook campaign, the Google Ads campaign, search engine optimization, email marketing, or the affiliate program is responsible for the new customers. Once you’ve figured out which strategy works best, you can invest more money and time in that strategy for even better results.
Without an attribution model, however, it is almost impossible to determine the impact of each marketing strategy. You are probably already implementing several systems simultaneously. You do not want to waste money or time, so you need a suitable attribution model for your advertising campaigns.
The attribution model is like a clock. If you don’t have a watch, you don’t know what time it is, and then you have to guess the time based on the sun’s position, but you can never really be sure. The same principle applies to your marketing strategies. A lot is advised here, but very little is known.
Many marketers use attribution models because they want to know which marketing activities are producing results. Now I have convinced you. You are sure that you also need an attribution model. But there is no single model that is equally suitable for all companies or all campaigns. But before you jump headlong into the action, I would like to go into the different types of attribution models quickly. There are eight models. I will now show you how each model works and how you can find a suitable model for your company or your advertising campaign.
1. “First interaction” attribution model
Imagine the following situation. You see this ad from Shopify on Facebook: You are interested in the offer, so you click on the ad and read the information on the landing page.
You’re convinced and want to download the file, so enter your email address and other contact information. Then, a few days later, you get an email from Shopify introducing a great SaaS product you want. You ask your boss and are allowed to buy the product. Which channel does this customer now have to be attributed to?
If you use the “First Interaction” attribution model, it will be added to the ad on Facebook. With the “First Interaction” attribution model, the sale is permanently assigned 100% to the first touchpoint, even if other marketing strategies were involved in the sale.
The customer often jumps from one campaign to another, but the first click counts the most. This attribution model is an excellent choice to determine which methods and strategies can acquire the newest customers. Then you can invest more money in these strategies and reach even more new customers faster.
2. “Last Interaction” attribution model
You’re on Facebook again. You see an ad, click on it, look at the offer, and then leave the page. A few days later, however, you want to take advantage of the company’s offer. You enter the website URL in your browser, click on the price overview, choose a product, and buy it. Sales are assigned direct website access in the “Last Interaction” attribution model. Why? Because 100% of the deal is given to the last touchpoint.
In which situations does that make sense?
For example, if you want to find out which channel generates the most conversions. With this attribution model, you can determine where the mutations occur in the last phase of the customer journey. Maybe it’s your email. These insights are critical because you will not use these channels to make even more money if you don’t know which advertising strategies to generate the most sales and customers.
Customers interact with your company on different channels, but customer acquisition often occurs predominantly on one track. With the attribution model “Last Interaction,” you can discover where conversions occur.
3. “Last indirect click” attribution model
The “Last Interaction” attribution model assigns the sale 100% to the last touchpoint. With the “Last indirect click” attribution model, all direct accesses are ignored, giving the deal 100% to the previous channel. Let’s say a customer clicks on one of your ads but doesn’t buy the product.
The next day he enters your website in the browser arrives at your website, and buys the product after all. In this case, the customer is assigned to the advertisement.
Why is the customer assigned to the banner?
Because this attribution model constantly measures the last indirect click but ignores all direct accesses. This model is helpful if you don’t want to measure direct traffic because most traffic is from users who have contacted your company or brand several times.
However, we only want to measure the last click without direct access to determine our marketing strategy’s effectiveness, not how many people know our company’s website. Direct traffic is not always meaningful because you first have to see where this traffic is coming from. With the attribution model “last indirect click,” you can determine which marketing strategy was the trigger.
4. Attribution Model “Linear.”
Sometimes you don’t want to assign the conversion to a single channel. Many channels are often involved in customer acquisition. The customer sees an ad on Facebook, then a banner searches for your company on Google, and finally, they buy your product.
Would it make sense to assign these customers to a single marketing channel?
If you think that would not make sense, use the attribution model “linear.” In this model, all touchpoints in the conversion path are assigned the same sales value. Maybe the customer is looking for information, landing on one of your blog posts, and subscribing to your newsletter.
Then he sees a retargeting ad on Facebook and lands on your website again but doesn’t buy anything yet. The “linear” attribution model assigns sales equally to all touchpoints, i.e., organic search, Facebook advertising, direct traffic, and banner advertising.
This model gives you a holistic view of your marketing strategies. Over time, you will find that some channels generate more conversions than others, and you can invest more time and energy in these channels to increase your sales.
5. Attribution Model “Position Based.”
You search Google for “Marketing Tips.” You click on a result, land on a website, and look around. You will see an Instagram ad and receive an email sequence a few days later. Then you see a banner and buy the product. With the “position-based” attribution model, the first and last click counts are evenly distributed among the rest.
The first and the last interaction are allocated 40% each, while the remaining 20% is evenly distributed among the exchanges. That makes perfect sense because the first click won the customer, and the last click converted them. With this model, you can determine which channel is best for lead generation and convert the lead into a paying customer. The intermediate steps are not so necessary in this case.
6. “Time course” attribution model
As a marketer, you’re probably interested in conversions. Traffic, leads, and loyal customers are great, but in the end, the money matters because you have to make a profit and figure out which channels are generating the most conversions.
There is also an attribution model for this. It’s called the “passage of time.” This model assigns the most excellent value to the touchpoints that are closest in time to the sale or conversion. Der letzte Touchpoint zählt am meisten, der erste am wenigsten.
If the customer first clicks on a banner, then receives a newsletter, then clicks on a Facebook ad, then accesses the website directly, and finally converts after a search query, the distribution looks like this: This attribution model can be used to determine which channels lead to the most conversions and which are more suitable for the first phase of the sales funnel. When you know this, you can invest your budget, time, and energy in the channels that match your goal: traffic generation, lead generation, or customer acquisition.
7. The data-driven attribution model
The data-driven attribution model differs from all other models. The other attribution models are based on assumptions. The “First Interaction” attribution model assumes the first click is valuable. The “Last Interaction” attribution model assumes the opposite.
Which assumption is correct? There are no assumptions to be made with the data-driven attribution model. With this model, you need to set goals and then rate each channel based on its effectiveness on those goals. Perhaps the customer first clicks on a post on social media sees a banner advertisement, receives a newsletter, and then converts to a paid search ad with one click.
Each channel is assigned the correct conversion percentage for the previously defined goal in this model. In this case, it’s selling. The data-driven attribution model is based on an algorithm determining how conversions are credited to the corresponding touchpoints in the customer’s purchasing process. Once you have this information, you can ditch the practical strategies and focus only on the method to make money.
8. “Last Google Ads Click” attribution model
Does the advertisement turn on Google? Do you want to know which of your campaigns is getting the best results? Then you must use the attribution model “Last Google Ads Click.”
With this model, 100% of the sale is attributed to the last Google Ads click. Now you are probably wondering in which situations this model makes sense.
With all other models, other channels are also included, but in this case, only the advertisements on Google count. When do you need that?
Answer: To determine which keywords are used to make the most sales. This attribution model can choose which Google Ads campaigns are getting the best results and which are not performing so well to invest more money in ineffective campaigns.
How to find the suitable attribution model for an advertising campaign
Now you are familiar with the different attribution models. You have got to know all eight models, see how each of these models works, and what strategies each model is suitable for. But that’s only half the battle.
Now you are faced with the difficult choice of choosing the suitable attribution model for your company. That’s easier said than done. Each model has its advantages and disadvantages. Determining which is ideal for your campaign or company is vital to success. To do this, you must ask yourself: “What is the ultimate goal I am pursuing with my marketing campaign, and which attribution model can I use to measure my target project most effectively?”
Different marketers swear by other attribution models. Each model has its right to exist and is suitable for different situations. Don’t be afraid to try different attribution models to see which works best for your marketing campaign and business. Maybe, in the end, it is a model that you didn’t even consider.
Too much paper creates clutter on the desk.
Your desk is nowhere near as cluttered as your marketing priorities.
Every new trend could mean the next big breakthrough for your company.
But it is far more lucrative to implement just a few strategies, measure the performance of those strategies, evaluate the results, and then invest more money in the process that will help your business grow.
However, you must measure your results effectively to assign the correct proportion to the respective strategies.
It would help if you tried all of the attribution models. Here is a brief overview of all models: “First Interaction,” “Last Interaction,” “Last Indirect Click,” “Linear,” “Position Based,” “Time History,” Data-Driven, and “Last Google Ads Click.”
There is no correct answer.
You need to find the attribution model that provides the best information in your situation to increase your ROI.
When you have found a suitable model, you can better manage your budget and time.
Which attribution model do you find best?
You can buy website traffic, focus on user engagement, optimize on-page and off-page SEO, and leverage social media channels to reach a wider audience.