As we discussed previously, it’s important to figure out what type of attribution makes the most sense for your business, although this is only half the battle. Once you have made it through the checklist above, it’s time to pick the model that most accurately aligns with your business strategy and objectives. Here are the most common attribution models every digital marketer should consider when determining how to assign conversion credit to marketing campaigns.
Last Interaction
This model attributes 100% of the conversion credit to the last channel/touchpoint of the buyer journey that leads to the sale. This is the most traditional model. However, one challenge is that it tends to favor certain channels (direct, organic, and branded search) because they typically take place towards the end of the marketing funnel.
For example, a customer might learn about a particular brand of bicycles through Facebook and Instagram ads, but then later they search for the brand, click on a Google Ad, then ultimately make the purchase. Although they learned about the brand and became aware through social advertising, Google Search would get 100% of the conversion credit in this scenario because it was the last touchpoint. Paid social channels are especially good at generating demand and fueling discovery, so it’s important to note that the last interaction model can undervalue those campaigns that bring new customers into the top of the funnel.
Linear
The linear model acknowledges every step of the customer journey in that it splits conversion credit evenly among all the touchpoints. For example, let’s say someone clicks on a Facebook ad promoting a pair of shoes, views a display ad from that same brand, searches for the shoes on Google and clicks on a search ad, and then goes directly to the website before purchasing a pair of shoes that cost $60. Since there are four touchpoints involved in this scenario, each channel would receive $15 of conversion credit for the sale. This attribution model can be used to help advertisers understand common consumer journeys, learn how often certain platforms and channels assist the user to the point of conversion, and develop a rough idea of which interactions have the greatest value for the business.
Position-Based
The position-based model gives weighted attribution credit to the first and last interactions of the customer journey and then distributes the rest evenly among the middle touchpoints (if applicable). The two most common types include 40% positional and 30% positional. Using the 40% positional model, let’s say that there are three touchpoints that take place during the path to conversion. The 40% positional model would be 40% – 20% – 40%, meaning that the first and last interactions receive 40% conversion credit while the middle gets 20%. Now, let’s say that a customer interacted with six channels. The 40% formula would then be 40% – 5% – 5% – 5% – 5% – 40%. Some advertisers use this attribution model to acknowledge the importance of both the first and last interactions that take place during the customer journey, so they want to highlight the channel that brought the consumer into the funnel as well as the very last interaction that takes place before conversion.
Time Decay
In this model, conversion credit is weighted so that the most recent touchpoints that take place before conversion will receive more credit than the channels that occur earlier in the funnel. There are two common types of time decay models: 1-day and 7-day. Looking at the 1-day model, the touchpoints that take place one day before conversion will receive 50% of the credit, with the remaining interactions decreasing 25% day-over-day. The 7-day model looks at a longer time period, so the touchpoints that take place during the 7 days before conversion receive 50% of the credit with the earlier interactions decaying 25% week-over-week.
The 1-day time decay model is better for businesses with very short sale cycles, while the 7-day model is better for companies that require a longer customer journey before purchase. For example, a t-shirt brand may use a 1-day time decay model, because the typical path to conversion takes around 4-5 days, which is very short. On the other hand, a mattress company requires more consideration from the customer and thus has a longer path to conversion, so this business may want to extend their time decay model to seven days.
Customization
Some advertisers like to customize and create their own attribution models. For example, in Google Analytics you can write your own formula or custom model based on keywords, type of interaction, traffic source, etc. Attribution comes in all different shapes and sizes, so it’s common for some businesses to create and define their own models that align with their needs, strategy, and objectives.
How to Avoid Common Mistakes
Finding the right attribution model can be fraught with mistakes, especially if you are unclear on campaign objectives or using an attribution model that may not be the best fit for your business. In order to combat these mistakes, it’s important to have clear KPIs for every campaign and test different attribution models until you find one that most accurately aligns with your overarching business goals. Here are three other mistakes that can also lead your attribution model astray during this process.
Failing to use a large data set
Your data set needs to capture all the touchpoints your customers make in order to get a full understanding of your buyer journey and marketing funnel. Limiting your model to a small data set will only get you halfway there. We would recommend digging into as many reports as possible in order to develop a clear picture of how your marketing channels are contributing to conversions.
Using a “one size fits all” approach
Your business is different from the business across the street. Your industry is different from all other industries. So it goes without saying that using the same approach won’t work for all industries or all businesses. Many companies use the more traditional last click model, thinking it will make things simple, but it actually underestimates the value and impact of channels that introduce customers to your product or service. The last click model does work for some businesses, but it should not be the default. In fact, we believe that there is no such thing as a default attribution model. This is why you must do your homework first and investigate multiple attribution models in order to figure out which one may be the best fit for your business.
Irregular monitoring
You can’t take any days off when it comes to analyzing your marketing strategy and funnel. To get the most effective snapshot of how buyers are interacting with your business, you need to continuously monitor the customer journey, from the first impression to final sale. Only focusing on one aspect, or failing to monitor the full-time window, will be counterproductive.