You use many different marketing channels to promote your products, grow your business, and reach more customers, and you spend a lot of time and money doing so. And you got the results, you started making more sales, apparently your marketing campaigns worked. But which ones, exactly?
In today’s digital landscape, the customer journey doesn’t happen in one place, it spans across multiple touchpoints and channels. Without knowing and analyzing each one of them, it’s hard to build up successful marketing strategies. This is where you should consider using cross-channel marketing attribution.
Most companies are already using cross-channel marketing, which is why it is necessary for them to perform cross-channel marketing attribution as well.
In our latest blog post, we made a detailed introduction to cross-channel marketing. In this article, our focus will be on cross-channel marketing attribution.
What is cross-channel marketing attribution and why is it important for businesses?
Cross-channel marketing attribution refers to the process of tracking and assigning credit to each marketing touchpoint across multiple channels that contribute to a conversion. It helps businesses to understand which of their marketing channels drive more customer engagement and sales most effectively.
In the context of marketing, a channel can refer to any platform which a brand interacts with its audience, such as social media, search engines, mobile applications, email, display advertising, and more. As we all know by now, prospects have several engagements with businesses across multiple channels before making a purchase. For example, they might see an ad on social media, then decided to check-it out and downloaded the app, then decided to purchase the product after seeing there is a discount if they do the purchase via this app. As you can see, each of these channels played a part in the customer’s journey and helped them convert in the end.
By tracking this customer journey and identifying which channels were involved in each conversion, marketers can understand how their marketing campaigns perform and optimize their spending.
Cross-channel marketing attribution is crucial for businesses as it enables them to determine the most effective channels, optimize resource allocation, and improve their marketing strategies. It lets businesses to see which channels are working best for them, and where to focus their efforts to get the best results.
Cross-channel marketing attribution provides significant benefits to companies if you use it effectively. When you think about it, it’s important to remember that one of your goals is to better allocate spend across channels by understanding their value and ROI.
Cross-Channel Attribution Models
An attribution model is used to determine the impact of the channel during a customer’s journey. There are several different cross-channel attribution models that businesses can use, each with their own strengths and weaknesses. We can summarize these attribution models as two main groups as single-touch and multi-touch attribution models.
Single-Touch Attribution Models
Single-touch attribution model gives the entirety of the credit for a conversion to a single touchpoint in the customer journey. These models are the easiest to implement.
- First-Touch Attribution Model: This attribution model gives all the credit to the first marketing channel that attracts a customer’s attention in their buying journey. This model recognizes the initial touchpoint as the primary driver of awareness or interest. If a customer finds your brand from an Instagram ad, download your app, and then buys your product from this app with the discount you offered, all credit goes to your Instagram ad.
- Last-Touch Attribution Model: This attribution model gives all the credit for a conversion to the last touchpoint before the customer completes their buying journey. This model assumes that the final interaction had the most significant influence on the decision. In the example above, all credit would go to your app’s discount campaign.
Multi-Touch Attribution Models
Multi-touch attribution models consider and give all the credit to all the engagements your customer had during their buying journey. Unlike single-touch attribution, these models can be hard to implement. Since they are more complex than single-touch models, they provide a more accurate picture of how different touchpoints work together to drive conversions.
- Linear Attribution Model: This model equally distributes credit across all touchpoints throughout the customer journey before conversion. This model recognizes the contribution of each interaction, regardless of its position in the sequence.
- Time-Decay Attribution Model: This modelassigns more credit to touchpoints closer in time to the conversion event. It assumes that interactions closer to the conversion have a more immediate impact on the decision-making process.
- U-Shaped Attribution Model: This model assigns more credit to the first and last channels that customers interact with during their journey. It gives less credit to the channels in between, which may have a supporting role.
- Data-Driven Attribution Model: The data-driven attribution model is largely different from all above. It is an advanced approach that uses statistical analysis and machine learning algorithms to assign credit to various touchpoints based on their actual impact on conversions – considering factors such as time, sequence, and interaction patterns.
Steps of Implementing Cross-Channel Marketing Attribution
Here are 5 essential steps to implement cross-channel marketing attribution to your business:
1. Data Collection and Consolidation:
For an effective cross-channel attribution measurement, marketers need to gather data from diverse sources including website analytics, CRM systems, ad platforms, social media, and offline touchpoints. Then this data needs to be consolidated into a centralized repository or data warehouse for a comprehensive view of customer interactions across channels.
2. Attribution Model Selection:
Second step should be choosing suitable attribution models (single-touch or multi-touch attribution models) which suit your business objectives and customer journey complexity. You need to evaluate these models to understand the impact of each touchpoint on the customer journey.
3. Using Attribution Tools and Technology:
As a next step, what you need to do is implementing specialized attribution software or platforms capable of handling multi-channel data analysis. You should integrate these tools into your data infrastructure and marketing systems for efficient processing, attribution modeling, and insights derivation.
4. Testing, Validation, and Optimization:
Now it’s time to run tests and validations using historical data or controlled experiments to validate the accuracy of selected attribution models. As a marketer, you need to analyze results to improve and optimize these models continuously. This way, you can ensure that attribution models align with actual customer behavior and deliver actionable insights.
5. Collaboration and Continuous Improvement:
Last but not least, you should foster collaboration between marketing, sales, and data analytics teams. You need to share your findings and insights across departments for unified understanding and strategy alignment. For a successful cross-channel marketing attribution, you must continually iterate and improve attribution strategies based on evolving consumer behavior and changing market dynamics.
By following these steps, you can establish a structured approach to implementing cross-channel marketing attribution, gain insights into the effectiveness of various marketing efforts across channels and optimize your strategies for better outcomes.