Attribution Modeling For Marketers: Ultimate Guide (2023)
Wondering how to optimize your marketing strategy? Attribution modeling can help! This guide will teach you everything you need to know about this powerful data-driven tool.
Marketers are data-obsessed creatures. If there’s a marketing conundrum to navigate, we’ll find a way to quantify it. Enter attribution modeling.
When it’s time to start ramping up conversions, marketing attribution models are like a treasure map to success. They’re a powerful data-driven tool for businesses looking to refine their brand and improve their return on investment (ROI).
Ready to take the guesswork out of marketing? Here’s how to identify which touchpoints are most influential in driving conversions so you can optimize your marketing strategy and get the most out of your marketing dollar.
What is a Marketing Attribution Model?
When running multiple campaigns, marketing attribution models help measure which channels produce the most value. In addition, an attribution model offers a way to assign credit to one or more marketing actions for any given conversion.
Why Are Attribution Models Important in Marketing?
Take the customer journey for, say, a pizza restaurant.
- A customer first sees an ad for the restaurant on Google while searching their computer for “restaurants near me.” They click the ad to view the offer before heading out to grab dinner elsewhere.
- The next day, the pizza joint runs a retargeting campaign, which targets an ad featuring images of cheesy, delicious pizza at that user as they scroll through their Facebook feed on their phone.
- Later that evening, the user sees a video ad on YouTube, which ultimately leads them to click the ad and place an order on their tablet.
In such a case, which touchpoint should receive the credit for the conversion? Should the pizza restaurant dump its entire marketing budget into YouTube ads? What about the other ads that came before it?
Attribution modeling can help you answer these kinds of questions to better understand what works (and what doesn’t) when running multiple campaigns simultaneously.
Additionally, you can look forward to benefits such as:
- Optimized creative elements
- Improving product functionality
- Micro-targeting and personalization
- Insanely higher ROI
7 Types of Attribution Models All Marketers Should Know
There are several attribution models that you can use to understand how customers interact with your brand across different marketing channels. Each has its pros and cons, and the model(s) you use will depend on the complexity of your customer journey and your marketing goals.
What it is: First-touch attribution gives 100% full credit to the first touchpoint in the customer journey. So in the pizza joint example above, the conversion would be attributed to the Google Ad that initiated the customer journey.
When to use it: First-touch attribution is quick and easy to set up and perfect for measuring top-of-funnel activities. This model is typically used with activities that drive brand awareness and work well for short buying cycles.
Consider this: The first touch model may be straightforward, but it ignores the possibility that other marketing channels may have influenced the conversion. As a result, you may draw inaccurate conclusions about how to design future campaigns.
Last-Touch (Qualified Lead) Model
What it is: Last-touch attribution (sometimes referred to as qualified lead attribution) gives 100% credit to the touchpoint where the conversion actually occurred—in our example, the YouTube ad.
When to use it: Last-touch attribution is easy to set up and understand, and it’s perfect for short customer journeys. It’s often the default attribution model for most analytics, including Google Analytics 4.
Consider this: Like the first-touch model, the last-touch is easy to implement. But it may attribute too much to the last touch point without considering the impact of earlier touchpoints, leading marketers to overestimate the final touch’s ROI.
Linear Attribution Model
What it is: Linear attribution assigns equal credit to all touchpoints in the customer journey. It’s often used as a starting point for analyzing customer journeys.
When to use it: Linear attribution is particularly useful for businesses with multiple touchpoints or channels in the customer journey or when it’s difficult to attribute the conversion to a specific touchpoint.
Consider this: Although this model works well in an omnichannel marketing environment, it may over or underestimate the influence of a single marketing channel. Therefore, it may not be helpful on its own for determining which specific marketing channel has the best performance.
Time Decay Model
What it is: A time decay attribution model assigns more credit to touchpoints that occur closer in time to the conversion and the most weight to the final touchpoint before the conversion.
When to use it: This model is useful when the business wants to understand the impact of recent marketing efforts and how they influence a customer’s decision to convert. While slightly more complex than linear, it’s suitable for understanding longer customer journeys—especially ones that rely on relationship building.
Consider this: While this model works exceptionally well for optimizing the most influential touchpoints, it’s ineffective for shorter sales cycles.
U-Shaped (Position-Based) Model
What it is: U-shaped, or position-based, attribution gives more credit to both the first (40%) and last (40%) touchpoints in the customer journey while giving less credit to those in the middle (20%).
When to use it: This model is designed to give more weight to the touchpoints considered most influential in the customer’s decision-making process, which is helpful for gaining insight into top- and bottom-of-funnel efforts.
Consider this: Indeed, this model works well for businesses with several touchpoints before the conversion. However, it may undervalue the impact of middle-path marketing efforts.
What it is: Attribution modeling can be customized to best fit your business’s needs. However, like any other marketing solution, attribution models should always be tailored to the company and its goals.
When to use it: The custom model works well when you have a large amount of data, such as with a complex customer journey that spans multiple channels or an extensive touchpoint funnel.
Consider this: Custom models are best used when the business already understands how each touchpoint contributes to the customer journey. This allows marketers to create an attribution model that accurately reflects the effectiveness of their marketing efforts.
Choosing the Right Attribution Model
Once you’re familiar with the different types of attribution models, you must choose the right one for your business. This can be challenging—and gets more complicated with each added touch point.
Bear in mind that each attribution model has distinct advantages and disadvantages, and often there’s no right or wrong answer. Instead, the key is determining which model best aligns with your business’s unique sales funnel, customer journey, and campaign goals.
You might consider the following questions when choosing the right attribution model(s) for your business:
- Do you have a long or short buying cycle?
- What does your sales funnel look like?
- What are your brand and business goals?
- Are you looking to optimize your customer journey?
- Are you strategizing how to spend marketing dollars?
Know your sales funnel and touch points, and choose models that align with your goals.
Using Google Analytics 4 For Attribution Modeling
You could spend excessive manual time crunching numbers and creating complicated analytics reports. But efficient marketers turn to professional tools like Google Analytics instead.
Google Analytics 4 allows you to quickly analyze the impact of different marketing channels across devices using one easy-to-use platform.
Using Google Analytics 4 to track marketing attribution models is simple.
To set up a model:
- Go to your Google Analytics property settings page.
- Select Attribution > Attribution Modeling.
- Select the type of model you want to create. Google Analytics 4 automatically defaults to the cross-channel data-driven setting.
- (Optional) Add filters and additional dimensions to narrow down the data you want to measure.
- Save your changes and view your results.
You can use Google Analytics 4 to measure performance across different attribution models, such as First Click, Last Click, or Linear. Be sure you also inspect your lookback window to measure timelines eligible for attribution. We recommend the 30 or 90-day window for most businesses.
Common Attribution Mistakes To Avoid
To ensure that your attribution modeling efforts are accurate, here are some common mistakes you should avoid.
Not setting clear goals for the Attribution Modeling process.
You should always conduct attribution modeling with a specific goal in mind. It’s important to clearly outline the desired outcome and then create an Attribution Model to help you reach it—not the other way around.
Applying Attribution Models too broadly.
Attribution models should be tailored to your specific business needs. Don’t assume that a “one size fits all” Attribution Model will work for every situation—you may find yourself with inaccurate or misleading results.
Failing to consider seasonality.
It’s important to consider any seasonal or cyclical changes in your Attribution Model. This will help you understand customer behavior over time and make better decisions about marketing investments.
Who Should Use Attribution Modeling?
Attribution modeling is a powerful tool for marketers of all sizes and levels of experience. Attribution models can help identify customer behavior, better inform marketing pricing decisions, and optimize campaigns for maximum ROI. In addition, attribution modeling is advantageous if you want to analyze the impact of your marketing efforts across multiple channels and devices.
How To Get Started With Marketing Attribution
By allocating resources and budgets based on data-driven insights, you can optimize your marketing strategies to achieve desired results across all platforms and improve your ROI.
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We’re a Seattle-based team of digital marketing experts helping midsize companies grow with data-driven performance marketing, sleek web design, and creative digital and video ads. Schedule a call today to find out how we can kick your marketing strategy to the next level.