Wednesday, May 21, 2014
Over the years, there have been tons of articles or research regarding marketing attribution. The most common talked about are first click/interaction and last click/interaction. Some other attribution modeling includes ‘time decay’, ‘linear’ and ‘position based’. Google analytics list some of these examples:
In the “Last Interaction” attribution model, the last touch point -- in this case the Email channel -- would receive 100% of the credit for the sale.
In the “First Interaction” attribution model, the first touch point -- in this case the Paid Advertising channel -- would receive 100% of the credit for the sale.
In the “Linear” attribution model, each touch point in the conversion path -- in this case the Paid Advertising, Social Network, and Email channels - share equal credit (33.3% each) for the sale.
In the “Time Decay” attribution model, the touch points closest in time to the sale or conversion get most of the credit. In this particular sale, the Email and Social Network channels would receive the most credit because the customer interacted with them on the day of the conversion. Since the Paid Advertising interaction occurred one week earlier, this channel would receive significantly less credit.
In the “Position Based” attribution model, 40% credit is assigned to the first interaction, 20% credit is assigned to the middle interactions, and 40% credit is assigned to the last interaction. The Paid and Email channels would each receive 40% credit, while the Social Network would receive 20% credit.
Definition of Attribution
So first of all, what is exactly marketing attribution? To explain this simply, attribution is about understanding which of your marketing channels or advertising contributed to a sale or conversion on your website. Using a soccer analogy, last click/interaction would be like attributing the goal (conversion) to Lionel Messi (striker), the goal scorer. With first click/interaction, the goal would be attributed from the assist provided by Xavi (midfielder), where his assist was made possible by Carles Puyol (defender) who broke up an attack from the opposition and launched a counter attack. If you a basketball fan instead of a soccer fan, below is a YouTube video that uses the basketball example:
Below we also have an image that illustrates how attribution funnels work from Zappos:
Many of the discussions and research I have seen are how first click influences or contributes to last click conversions example using the soccer analogy above. Or how other ‘first click’ marketing or advertising efforts such as display or social media drives conversions on the last click which could be from paid search, etc.
However, so far I have not seen much information in regards to how non-brand paid search advertising contributes to branded conversions. To answer this question, I had a looked at 10 retail clients/websites’ conversion funnels over a 30-day period and with 12 months worth of data (if available). The average percentage (%) of branded conversions came via non-branded keywords as a first click was between 1.21% (lowest) to 7.86% (highest). One of the trends I did noticed was that the percentage gets higher with more well-known brands as compared to lesser-known brands.
Therefore, with this data, one of the question to ask is when we measure branded performance, should we also be adding these percentages to the total branded performance as well?