6 Commonly Used Marketing Attribution Models

6 Commonly Used Marketing Attribution Models

An ideal scenario for any digital marketer would be that every click on the ad directly results in a sale. But alas, the reality is quite different!

Your target audience encounters various touchpoints in their journey with your brand before converting into a customer. They might see your ad over a social media platform, visit your website, read a couple of blogs and finally after a week or so convert by clicking on a retargeting ad they encounter on a website!

So the question that arises is which channel should get the credit for the conversion? Well, that’s exactly where a Marketing Attribution Model comes into picture!

What Is A Marketing Attribution Model?

In simple terms, it is a framework that analyzes which marketing channel (or channels) should receive the credit for the sale. There are various types of attribution models but we’ll stick to the 6 common ones that are used the most. Needless to say, each model distributes the credit for conversion for each touchpoint in a different way.

What Are The Common Attribution Models?

Now there’s no “best marketing attribution model” out there but factors like business goals and buying cycles will help you choose the one which might be suitable for you.

Here are the attribution models that we’ll be discussing:

  • First Interaction Attribution
  • Last Interaction Attribution
  • Last Non-Direct Click
  • Linear Attribution
  • Time-Decay Attribution
  • Position Based Attribution

1. First Interaction Attribution

As the name suggests, this model gives 100% attribution to the first touchpoint, your business had, with the lead before the final sale happened. It is also known as “First Click” approach.

Example: Sam saw your Facebook ad and visited your website. A few days later he saw a Youtube ad about your product. A couple of weeks later he went directly to your website and made a purchase. The Facebook ad will get 100% credit for the conversion as shown below:

First interaction model is quite simple and straightforward but doesn’t take into consideration the effect of any subsequent touchpoint that happens later in the customer’s buying journey. This is suitable for businesses where the buying cycle is very small and customers tend to convert immediately after a couple of touchpoints.

2. Last Interaction Attribution

You might have already guessed it – this model gives 100% attribution to the last touchpoint your business had with the lead before the final sale happened. This model is also called “Last Click” or “Last Touch” approach.

Example: Taking the same scenario we saw in the First Interaction approach, the direct traffic will get 100% credit for the conversion instead of the Facebook Ad. The image below will help you understand better.

Last Interaction model is the simplest to implement & is also often quite accurate. This is because your audience interacts with your business through multiple devices and multiple browsers, often deleting cookies and tracking codes which makes it difficult to map the customer journey. But one thing you can be absolutely sure of and that’s the last interaction the person had before converting.

3. Last Non Direct Click

This attribution model is more sensible than the two approaches discussed previously. Although the attribution is still made to one touchpoint instead of all of them, it’s the last non-direct interaction right before the sale which gets all the credit.

Example: Sam watched your ad on Youtube. A couple of days later he sees your Remarketing ad on a his favorite tech news website. After a week he visits your website directly to make a purchase. The credit for conversion will be attributed to the Remarketing Ad (last non-direct interaction) rather than the direct traffic (direct interaction) as shown in the image.

This attribution model takes into consideration the fact that if a person is directly visiting your website for a purchase then they already know about your product which is mostly accomplished through the ads that you run.

4. Linear Attribution

Linear attribution model splits the credit between all the touchpoints involved in the purchase journey of the customer.

Example: Sam receives a marketing Email where he clicks the link to visit the product page. A few days later he watches an ad on Youtube regarding the same product. A month later he sees a Retargeting ad on his favorite blog, clicks it, and makes a purchase. The credit for conversion is attributed equally to all the three touchpoints involved – Email campaign.

This approach is more balanced as it allows you to take into consideration the cumulative effect of all touchpoints leading to the purchase decision by the person. This attribution model is your go-to choice if you are looking for something that is easy to explain to clients.

5. Time Decay Attribution

This model also attributes the credit of sale to all the touchpoints involved. However, it also takes into consideration how close each touchpoint is to the time of purchase thus giving more credit to the last touchpoint.

Example: Taking the same example as in the Linear Attribution, the highest credit will be attributed to the Retargeting ad as that touchpoint occurred closest to the time of purchase made by Sam. The attribution to other touchpoints will be progressively lower according to how far they are from the time of purchase.

This model gives importance to “relationship-building” which is an important aspect for any business. Time Decay Attribution is suitable for you if your business has a long buying cycle as in the case of B2B sales.

6. Position Based Attribution

Also known as the “U Shaped Attribution”, the Position Based Attribution model divides and distributes majority of the credit for sale to the  lead’s first and the last interaction with your brand. The remaining credit is equally distributed to all the other interactions in between.

Example: Sam saw a Search ad for your product on Google which led him to your website. A couple of days later he saw a Retargeting ad on some other website he visited. A week later he views a Youtube ad. A month he encounters a Facebook ad which he clicks and makes a purchase. 80% of the credit for sale should be attributed equally between the Search ad and the Facebook ad (40% each). The remaining 20% can be attributed to the remaining touchpoints (youtube ad and retargeting ad).

This model not only gives some credit to each touchpoint to acknowledge their contribution but also gives more weight to the first and the last touchpoints as the former is responsible for building awareness and the latter prompts the purchase decision.

Regardless of which attribution model you choose, one thing is certain that more often than not, the customer journey involves various touchpoints with your brand before concluding into an actual sale. So your marketing mix should include a mix of channels to reach out your target audience.

Looking for a team to help you kickstart your marketing strategy? Let’s Talk

Leave a Reply

Your email address will not be published. Required fields are marked *