Every year, we observe that the marketing budgets are consistently soaring and cost per acquisition is rising across channels. With the increasing complexity of the digital world which is getting amalgamated with the offline world, the task is becoming a huge challenge for digital marketers. To know which channel works for their specific requirements and how the marketing budget should be allocated, they must consider channel attribution analysis.
In simple words, channel attribution analysis answers the most pertinent question that every digital marketer has in his mind – “What part of my marketing efforts, should be credited for this specific sale?” Hence, connecting marketing spends and efforts with the sales made, is marketing attribution. Working out which channels of marketing contributed to what portion of the total sales is channel attribution analysis.
Digital marketers always want to know how each marketing dollar performs and how it translates into sales. So, any technique that can help them understand this mystery so that they can spend their budgets wisely is welcomed. Earlier, they used results from various analytics platforms or some customized solutions built in-house, but today channel attribution analysis has become a science and requires special expertise due to the high complexity. Attribution has to cover a variety of parameters such as:
The customer journey and path to purchase is highly intricate as they follow multiple channels, media, and screens to make that final purchase. It is very important for marketers to accurately give credit where it’s due.
The area of channel attribution modeling is still in the evolving stage and there are various techniques that analysts utilize to arrive at the golden numbers. Here are some of the popular techniques used:
Out of the various models mentioned above 80% of the digital marketers use the last-click approach. Although, the results received through this model do not give the complete picture; implementing a sophisticated multi touch-point channel attribution analytics model is not as easy as it sounds. Even though it a big challenge, many digital marketers are slowly moving towards advanced channel attribution analytics.
Advanced channel attribution analytics offers several advantages:
Optimize customer journey: By studying the marketing funnel and customer journey in great detail and giving credit at the h2>marketers can get a better understanding of the customer journey and optimize their media mix for better results.
Giving credit where it’s due: Attribution analytics provides transparency around introductory, assisting, and converting channelsh2>opportunity to the marketers to allocate a fair share of credit to each contributing channel based on their impact on the key conversion metric.
cost per acquisition: Channel attribution analytics can help marketers avoid wastage of media impressions and boost h2>by investing in the right places and keeping the CPA under control.
Optimizing multi-channel media spends: The most important advantage of channel attribution analytics is to identify the best h2>conversion and sales and investing more on those channels. Digital marketers can get a clearer picture of what works and what doesn’t and then allocate their marketing dollars for the best options.
Powerful tools and analytics models are now available for marketers to get started with channel attribution analytics or go a level higher on the ladder with advanced analytics that is customized for their business needs. Since the field is still in the evolving stage, there is no single cookie-cutter solution that can give you all the answers. There are various approaches, methodologies and solutions available that can make the task easier but attaining precise answers is still a distant dream for marketers.
Nabler offers a client-specific and customized channel attribution model that includes the following stages:
Channel attribution is now considered an integral part of digital marketing ecosystem but it comes with its own disadvantages. For instance, there are many offline channels that cannot be tracked with accuracy. There are many customers who move from offline to online channels and in those cases, companies can never be sure of the attribution. Moreover, there are many customer relationships that a business builds over time and these recurring customers contribute a major portion of the revenue, so the influencer here is brand equity and not the latest marketing tactic.
Despite these challenges, channel attribution is becoming a priority for marketers as the process of attribution modeling is now getting more sophisticated with the multi-channel approach. Marketers can get a better understanding of marketing impact and focus on better performing digital channels with agility.