Building a business case for attribution
AdRoll's Ben Sharp breaks down the tech speak surrounding attribution models to help you choose the right one for your business, in this guest post.
Attribution has been a key topic for Aussie marketers in 2016, with research from February showing that 92% of marketers recognise the importance of tracking their marketing activity alongside the customer journey.
The unfortunate thing is that 58% of Australian marketers were still using the outdated and just plain wrong first or last touch models.
So, marketer’s understand that attribution is important and 51% of marketers believe that better multi-touch attribution is the future of attribution yet the majority are hanging on to single touch models.
Why? Is it laziness, lack of education, not understanding the models or not understanding how to put forward a business case to the C-Suite? Attribution – Building a business case for attribution aims to answer those questions.
Education is paramount
Everywhere you turn at the moment there’s interesting articles, great whitepapers and in-depth research on attribution. Ensure that you read, read, read! Attend industry events to hear from those at the top of their game like AdRoll’s CMO Adam Berke who presented on Marketing Metrics that Matter this year at Mumbrella360.
Education feeds into the next two points nicely…
What attribution models are out there?
Attribution models are divided into rules based models and algorithmic models. The rules based models are determined by people. There are a number of ‘off the shelf’ models that are simple to understand and implement.
- Last-touch – This model gives all the credit to the last interaction a customer has with a marketing channel.
- First-touch – This model gives all the credit to the first interaction a customer has with a marketing channel.
- Linear – A simple version of linear gives each touch point in the customer’s journey equal credit.
- Time-decay – This is similar to the linear model except that more credit is given to more recent activity.
- Position-based linear – Another version of linear where the first and last are given more credit than the touches in the middle.
Algorithmic models are much more complex and machine driven. The touch-points on the customer journey are attributed different weightings depending on an algorithm that takes into account data science and conversion data.
The biggest thing to remember when it comes to choosing an attribution model is that there is no ‘perfect’ solution. The correct model for your business depends on what the path to purchase looks like, how recognised a brand is and how the business operates.
Attribution models can’t be thought of as a ‘set and forget’ project. They need to be constantly checked, tweaked and tested to ensure the most appropriate model is being implemented.
What about getting buy in from the C-Suite?
The C-suite cares about profitability, ROI measures and customer perception measures. Understanding the KPIs and the language that each of your internal stakeholders will respond best to will take you a long way:
- Sales: We will be able to better identify qualified customers and drive sales
- Finance: We will spend our money much more efficiently
- CEO: ROI in marketing spend will increase and as we learn more about the customer we can better direct our investments towards building better experiences
The principle benefit of attribution is that it tells you which of your investments are driving bottom-line performance and which are not pulling their weight. Once you’ve explained to the C-suite that the benefits far outweigh the costs and answer the in depth questions they will throw at you, the battle is won.
How to go about building a business case
The business case for an attribution project is dependent on a flexible test and learning process. The objective of a good business case is to spend less yet improve the outcome. That is, if there is a wider difference between investment and outcome, the result should create more commercial opportunity. Marketers who are involved in the attribution business have several important suggestions:
- Get on the front foot early and identify your own weaknesses around inefficient spend
- There is no need to ask for extra budget. Instead, use a small part of your existing budget to identify where you are spending inefficiently
- That small investment can readily yield a 10-15% return
- Shoot for quick, easy wins early to build confidence of stakeholders
- Focus your KPIs on the kinds of messages that resonate in the C-Suite
The best thing about attribution is simple: it tells you which of your investments are pulling their weight, and which ones are falling behind.
Rather than aiming for perfection, marketers should start their attribution journey with the simple goal of being ‘less wrong’ and improving gradually.
Our full Attribution Guide is now live and allows for further insight and greater detail into how attribution allows for your brand to understand its customers journey better which, in turn, will benefit you in the long run.
Ben Sharp is managing director at AdRoll APAC
Bloody amazing that some marketers and many of the digerati seem to have forgotten to include non-digital influences in their attribution models, making them all 100% wrong (unless they, and all of their competitors are 100% non-digital.
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