Most marketers will agree with me when I say that attribution is one of the most valuable tools you can use to optimize your campaigns.
At the same time, the metrics we use to determine it are some of the least sophisticated.
But in recent years, a new analysis strategy has become more accessible to a wide range of businesses, and it’s creating a lot of buzz in the marketing world.
This post will show you why multi-touch attribution can be your startup’s secret marketing weapon.
What is Attribution Modeling?
Attribution modeling is based on the idea that most customers will interact with your brand more than once before buying.
Marketers track and measure all of the “touchpoints” a customer makes with their brand and determine how much value each has in driving sales. Accurate attribution modeling can help optimize your marketing efforts over time.
There are several approaches a business can take to attribution modeling, depending on their resources and marketing sophistication. These include:
- First Touch Attribution, where value is given to the channel that generated the lead.
- Last Touch Attribution, where value is given to the last touchpoint the customer makes before buying.
- Multi-touch Linear Attribution, where equal value is given to each touchpoint a prospect makes.
- Multi-touch Time Decay Attribution, where value is given to each touchpoint, but the last touch before purchase is given more value than the others.
- Multi-touch Position Attribution, where each touchpoint is given a unique value.
Many emerging startups who aren’t in the position to adopt advanced marketing automation often start off using a first touch attribution model.
While historically multi-touch has been prohibitively expensive for many businesses, new technologies and a true understanding of the value of multi-touch for marketing success are turning it into an essential tool for startups of any size.
The Limitations of Single Touch
Single-touch attribution is simple and easy for marketers to adopt, but few realize just how much consumer behavior information the method ignores completely.
Single-touch attribution worked well in the marketing world of 15 years ago. touchpoints on a consumer journey then were limited to store visits, direct mail marketing, phone calls, and a few other strategies.
Now, the customer journey is exponentially more complex. It transverses channels, devices, and screens, and it has a wide range of potential touchpoints: search, social media, email, mobile, in-store visits, and many others.
Single-touch picks one channel and ignores the rest, leaving huge gaps in consumer behavior that could be used to develop more accurate marketing campaigns in the future.
A recent analysis from Kenshoo gave insights into just how much some channels can be undervalued when businesses utilize last touch attribution:
The Value of Multi-Touch
Single-touch gives 100% of the credit to a touchpoint when the customer journey most definitely includes many more. Multi-touch rectifies this issue by paying attention to every single factor and assigning value in a wide variety of ways:
Businesses can use the unique insights of multi-touch methods to make informed marketing decisions, like:
- Eliminating unproductive spending. Considering the role of every touchpoint makes it easy for marketers to identify the ones that aren’t bringing results. Single-touch attribution forces businesses to guess which efforts are unproductive, without understanding the real effect these changes might make.
- Avoiding elimination of valuable touchpoints. Multi-touch attribution greatly reduces the chances that your marketing team will accidentally eliminate a non-converting touchpoint that has value in the customer journey.For example, Nielson research found that brands that have both organic and paid ads appearing in Google search have a higher organic click-through rate (CTR) than those that don’t. Marketers only paying attention to one touchpoint might take this to mean that their PPC ads aren’t valuable for conversion and decide to reduce spending, only to find their organic CTR falls as well.
- Improving ROI in impressive ways. The combined efforts outlined above can work together to result in exponential returns on marketing investment. According to a recent Teradata whitepaper, sophisticated attribution modeling can improve a business’s Return on Ad Spend (ROAS) or Return on Marketing Investment (ROMI) between 3 and 10%.For some, that’s millions of dollars saved on marketing.
Why Multi-Touch Attribution Can Be Your Startup’s Secret Weapon
At this point, you probably have a pretty good idea why multi-touch attribution is a valuable strategy overall, but there are more reasons why your startup should be adopting it now.
Last Click Remains a Marketing Standard
Multi-touch attribution is definitely receiving a lot of buzz in the marketing world, but that hasn’t turned it into a widely used strategy. According to a recent report by Criteo, last click remains the standard strategy:
When speculating why multi-touch attribution hasn’t been widely and even universally adopted by now, the only real reason they could come up with was fear. Switching models requires new technology, skills, and vendor relationships, meaning the change would be very disruptive for businesses.
But when you think about it in terms of modern-day marketing, where adopting cutting-edge technologies is undoubtedly the driving force behind success, this is a completely invalid reason.
Luckily enough, though, this hesitancy is something that a startup can leverage to its advantage.
By becoming an early adopter of a logical and proven marketing method, startups can reap the benefits of having considerably more insights into the effectiveness of their campaigns than their competitors.
The Payoff Makes It Worthwhile
I mentioned above that many startups use first-touch attribution as an entry point if they haven’t yet invested in advanced marketing automation.
That seems like a logical and cautious strategy, except when you consider how limited first-touch and last-touch attribution have ended up being.
Meanwhile, new case studies continue to appear demonstrating the real benefits of switching to a multi-touch model.
Just take Zendesk, a cloud-based customer service platform, who made the switch and were then able to:
- Better understand the value of their impressions, and increase qualified leads by 63%.
- Optimize keywords to increase conversion rates from paid search by 28%.
If You Don’t Do It Now, You Will Later
Even if you’re still not convinced that adopting multi-touch attribution is possible for your startup, be aware that the hesitation can’t be permanent. Multi-touch may seem like a sophisticated option at this point, but soon it will become a necessity.
According to Forrester research, 2016 will bring an estimated number of marketing ad placement opportunities into the trillions. And the options will likely only rise in the coming years.
That means businesses who choose not to upgrade their marketing technology will be left alone to manage millions of keyword placements and select the best ad placement opportunities from billions of options. This can’t be done in a spreadsheet.
Conclusion
The time has already come for marketers to update their attribution strategies, startups among them. Once they do, marketers can reap the many benefits of multi-touch insights, such as:
- Better understanding of customer behavior
- Improved customer experience
- Greater ROI
- Better budget allocation
- A more accurate campaign
- Greater confidence in marketing decisions
The only question remaining is if your startup is going to take maximum advantage of these benefits by adopting early – and making multi-touch attribution your secret marketing weapon.
Images: Kenshoo’s Multi-touch Attribution Whitepaper, Criteo’s Marketing Attribution Whitepaper, Criteo’s Marketing Attribution Whitepaper, Zendesk