What are the Different Attribution Models?
Marketing attribution models are methods or frameworks used to assign credit to different touchpoints or interactions in a customer’s journey that lead to a specific desired action, such as a purchase, sign-up, or conversion.
These models help businesses understand how various marketing channels and activities contribute to the success of their campaigns and overall marketing efforts.
At the core of marketing attribution is the idea that marketing efforts should be carefully tracked and analyzed to understand how different activities contribute to overall success.
To paraphrase an old saying, if a click takes place today but nobody converts until 3 weeks later, does anyone know what drove that sale?
That answer can change based on the type of attribution model used for client campaigns. Some attribution models may focus on the latter part of the sales funnel, while others credit earlier marketing channels for conversion.
There are several commonly used marketing attribution models each with its approach to credit assignment.
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First Touch Attribution Model
The first touch attribution model is one of the most straightforward methods for assigning credit to different touch points along a customer’s journey. In this model, all the credit for a conversion is given to the very first interaction that a customer has with your brand
How the First Touch Model Works
- Initial interaction
The model attributes all the credit for a conversion to the initial touchpoint through which a customer first interacts with your brand. This could be the first click on a digital ad, the first visit to your website, or any other initial point of contact.
- Simplicity
One of the key advantages of the First Touch model is its simplicity. It’s easy to implement and understand, making it a good starting point for businesses new to attribution modeling.
Pros
- Top-of-Funnel insights
It provides a clear view of how your marketing efforts are performing at the top of the sales funnel. You can see which channels or campaigns are driving initial interest in your products or services.
Cons
- Omission of subsequent touch points
One of the significant drawbacks of the First touch model is that it completely ignored the contributions of subsequent touch points in the customer journey. It doesn’t account for the nurturing, follow up or retargeting efforts that might have played a crucial role in converting the customer.
- Lack of nuance
This model lacks nuance as it assigns 100% of the credit to the first interaction. In reality , customer journeys are often more complex, and different touch points may have varying degrees of influence.
When to Use the First Touch Model
The first touch attribution model is most useful when you want to understand the effectiveness of your marketing efforts in creating initial awareness and interest in your products or services. It’s particularly relevant for businesses that have a straightforward, short sales cycle where customers typically convert quickly after their first interaction. However, in many cases, it’s advisable to use more advanced attribution models that consider the entire customer journey for a more accurate representation of touchpoint impact.
Last Touch Attribution Model
The Last touch attribution model is another straightforward approach to assigning credit to various touch points along a customer’s journey, but in this case, it gives all the credit for a conversion to the very last interaction that led to the conversion.
How the Last Touch Model Works
- Final interaction
The last touch model attributes 100% of the credit for a conversion to the last touchpoint that a customer engaged with just before completing the desired action, such as making a purchase, signing up, or filling out a contact form.
- Simplicity
Similar to the first touch model, the last touch model is quite simple to understand and implement. It’s essentially a ‘last click gets all the credit” approach
Pros
- Focus on conversion drivers
This model is particularly useful for identifying the immediate actions or touchpoint that directly lead to conversions. It highlights the working at the very end of the customer journey.
Cons
- Neglects the full customer journey
A significant limitation of the Last Touch model is that it completely ignored the contributions of all other touchpoints in the customer’s journey. It disregards the nurturing, brand building, and awareness-building efforts that occurred before the final interaction.
When to Use the Last Touch Model
The Last Touch attribution model is most valuable when you want to focus on understanding the immediate actions or touchpoints that directly lead to conversions. It’s useful for businesses with a straightforward and short sales cycle, where customers typically convert quickly after their last interaction. However similar to the First touch model, this model may not be suitable for businesses with longer and more complex customer journeys as it overlooks the impact of all other touchpoints.
Linear Attribution Model
The linear attribution is a more balanced and even handed approach to assigning credit to various touch points in the customer's journey. Unlike the First touch or last touch models , which attribute all the credit to a single interaction, the linear Attribution Model distributes equal credit to every touchpoint encountered throughout the customer journey. This provides a more holistic perspective of how each interaction contributes to conversions.
How the Linear Model Works
- Equal distribution
In the linear attribution model, credit is equally distributed among all touchpoints in the customer journey that led to a conversion. For example if a customer had 5 interactions before converting, each touchpoint would receive 20% of the total credit.
- Balance
The model aims to provide a more balanced view of the customer journey by acknowledging the contributions of all interactions, regardless of when they occurred in the process.
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Pros
- Balanced perspective
The linear model recognizes that different touchpoints play a role in the customer journey. It doesn’t favor the first or last interaction, providing a fair representation of each touchpoint contribution
Cons
- Equal weighting may not reflect reality
This model assumes all interactions have equal importance, which may not be the case. In reality some touchpoints may have a more significant impact than others.
- May not address complex journeys
For business with complex, Non linear customer journeys , the linear model may not provide a precise understanding of how different touch points influence conversions.
When to use Linear Model
The linear attribution model is most useful when you want to take a more balanced view of the customer journey and understand the contributions of various touch points. It can be particularly suitable for businesses with relatively straightforward journeys and multiple marketing channels . However it may not capture the nuances of more complex customer journeys , where some interactions play a more substantial role in the conversion process than others. In such cases, more advanced attribution models like the Data driven model may be necessary to gain a more accurate assessment of touch point influence.
Time Decay Attribution Model
The Time Decay Attribution Model is a more sophisticated approach to assigning credit to touch points along the customer journey. It recognizes that interactions closer to the point of conversion often have a more significant impact and assigns more credit to them. This model takes into account the fact that the influence of touch points tends to increase as a customer moves closer to making a decision.
How the Time Decay Model Works
- Weighting by time
In the time decay attribution model, the credit is distributed based on a time based weighting system. Touch points that are closer in time to the conversion event receive more credit, while those that occurred earlier receive less credit.
- Diminishing influence
The model acknowledges that the influence of touchpoints tends to increase as. A customer progresses through the sales funnel. Therefore, it attributes more value to the touchpoints that occurred just before the conversions.
Pros
- Reflects real world behavior
The model aligns with real world behavior, where interactions closer to the point of conversion often have a more significant impact.
- Balanced perspective
While it focuses more on recent interactions, it still gives some credit to earlier touchpoints , providing a balanced view of the customer journey.
Cons
- May not account for longer journeys
For businesses with extended sales cycles and highly complex customer journeys, the Time decay may not accurately reflect the cumulative impact of all Touch points.
- Complexity
Implementing and maintaining this model can be more complex compared to simpler models like first or last touch attribution.
When to Use the Time Decay Model
The time decay attribution Model is most useful when you want to balance the recognition of recent touchpoints' influence while still acknowledging the contributions of earlier interactions. This model is particularly suitable for businesses with relatively linear customer journeys, where the impact of touchpoints increases as customers get closer to making a decision. However for businesses with longer and more intricate customer journeys. A more advanced attribution model such as the Data driven Model might be necessary to provide
A more precise understanding of touchpoint influence.
The Data driven Attribution Model
The Data Driven attribution model is an advanced and highly accurate approach to assigning credit to various touchpoints in a customer's journey. It used data analytics and machine learning algorithms to analyze a wealth of data and determine the actual impact of each touchpoint on conversions. This model is particularly well suited for businesses with complex and nonlinear customer journeys.
How the Data Driven Model Works
- Data Analysis
The Data driven attribution Model involves collecting and analyzing a vast amount of data related to customer interactions. This data may include information about touchpoints, channels , timing user behavior and more.
- Machine learning Algorithms
Advanced machine learning algorithms are then applied to the data to assess the actual influence of each touchpoint on conversions. These algorithms can uncover patterns , trends, and correlations that are difficult to identify using manual or rule-based methods.
- Customized attribution
The attribution Model customized attribution of each touchpoint assigning credit based on its real impact within the specific context of a business's customer journey.
Pros
- Accuracy
This model provides a highly accurate and data backed assessment of touchpoint influence. It can identify subtle and complex relationships between touchpoints and conversions
- Flexibility
It can adapt to the specific nuances of a business’s customer journey accounting for the unique characteristics and influences of each touchpoint.
Cons
- Data and Resource intensive
Implementing the Data driven model requires substantial data and resources. It can be complex to set up and maintain, often necessitating expertise in data analytics and machine learning.
- Not suitable for all businesses
smaller businesses or those with limited data may find it challenging to implement this model effectively. It’s most beneficial for organizations with ample data and the means to apply advanced analytics.
When to Use the Data driven Model
The Data Driven attribution Model is most valuable when you want the most accurate and customized understanding of touchpoint influence within your customer journey. It’s particularly beneficial for businesses with complex , non linear customer journeys that involve multiple touch points and channels. If your organization has the data and resources to implement and maintain this model, it can provide insights that are difficult to obtain using more simplistic attribution models.
However it may not be practical for small businesses or those without the necessary data infrastructure and expertise.
Position Based Attribution Model
The position based attribution model, often referred as U-Shaped attribution model, is a method for assigning credit to different touchpoints in the customer’s journey . This model provides a balanced perspective by giving significant credit to both the first and last touch points while also allocating some credit tk intermediate interactions. It’s particularly suitable for businesses that want to acknowledge the importance of both initial engagement and final conversion in the customer journey.
How the position based model Works
- First and Last interactions
In the Position based model, credit is distributed to both the first and last touchpoints that a customer encountered. These touchpoints are often seen as having a more profound impact on the customer’s journey
- Intermediate interactions
The model also assigns a portion of the credit to the intermediate touchpoints or interactions that occurred between the first and last. The exact distribution can vary but is often evenly split among these touchpoint
- Customization
The allocation of credit can be customized to fit the specific needs and priorities kf a business. For instance, you might assign 40% to the first touch, 40% to the last touch and distribute the remaining 20% equally among intermediate touches.
Pros
- Flexibility
The allocation of credit can be customized to match a businesses unique priorities and the nature of its customer journey.
Cons
- Assumes equal importance of intermediate touchpoints
The model assumes that the intermediate touchpoints have equal importance which may not always reflect reality. In some cases certain intermediate interactions may have a more substantial influence on the conversion
When to use the Position Based Model
The Position based attribution Model is most useful when you want to strike a balance between recognizing the significance of both initial interest and final conversion in the customer journey. It’s particularly relevant for businesses with relatively straightforward customer journeys where both the first engagement and the last interaction play a crucial role in conversions. However businesses with highly intricate and nonlinear customer journeys may find this model too simplified and might benefit from more advanced attribution models that better capture the nuances of their customer journeys.
Illustration of Attribution Models
Let's illustrate each of the different marketing attribution models with the same example, which is a customer's journey to purchase a product online. In this example, the customer interacts with various touch points before making a purchase.
Scenario: A customer, Cindy , decides to purchase a smartphone online. She goes through several touchpoints in her journey.
- First Touch Attribution Model:
In the First Touch model, all the credit goes to the very first interaction. In Cindy's case, she initially discovers the product through a Google search, clicks on an ad for the smartphone, and proceeds to the product page.
Result: In this model, Google Search would receive 100% of the credit for the sale because it was the initial interaction that introduced Sarah to the product.
- Last Touch Attribution Model:
In the Last Touch model, all the credit goes to the last interaction. Cindy later decides to make the purchase after seeing a Facebook ad for the same smartphone, clicking on the ad, and completing the purchase.
Result: In this model, Facebook would receive 100% of the credit for the sale because it was the last interaction before the conversion.
- Linear Attribution Model:
In the Linear model, credit is evenly distributed among all interactions. In Cindy's journey, this would mean that both Google Search and Facebook ads would receive equal credit.
Result: Each interaction would receive 50% of the credit for the sale, providing a balanced view of their contributions.
- Time Decay Attribution Model:
In the Time Decay model, credit is distributed with more weight given to the interactions closer to the conversion. In Cindy's case, the Facebook ad, which occurred just before the purchase, would receive more credit.
Result: The Facebook ad might receive 70% of the credit, while Google Search would receive 30%, reflecting the idea that the Facebook ad had a more significant impact closer to the purchase.
- U-Shaped (Position-Based) Attribution Model:
In the U-Shaped model, a significant portion of the credit goes to both the first interaction (Google Search) and the last interaction (Facebook ad). The remaining credit is evenly distributed among intermediate interactions.
Result: Google Search and Facebook ads might each receive 40% of the credit, while the remaining 20% is divided among other interactions, acknowledging the importance of both the initial interest and final conversion.
- Data-Driven Attribution Model:
The Data-Driven model analyzes the vast dataset to determine the actual impact of each touchpoint. It considers factors like timing, user behavior, and channels' performance. It might find that a specific referral website had the most significant influence in Cindy's case, assigning credit accordingly.
Result: The Data-Driven model might determine that the referral website deserves 60% of the credit, while other touchpoints receive varying percentages based on their actual influence.
These different attribution models provide diverse perspectives on the same customer journey, allowing businesses to choose the model that aligns best with their goals and better represents the real impact of their marketing efforts.
Conclusion
Marketing Attribution models offer businesses valuable insights into the customer journey and the impact of various touchpoints in conversions.
Each model serves a specific purpose. Choosing the right model depends on a business’s unique circumstances, objectives, and the complexity of customer journeys, ultimately empowering them to make informed decisions and optimize their marketing strategies for greater success.
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