Attribution Modeling - How Attainable is it?
In today's digital world, marketing has become more complex than ever before. With the rise of multi-channel and omnichannel marketing and the abundance of data available, it is crucial to have a clear understanding of which marketing channels are driving sales and how much credit each channel deserves. This is where attribution comes in - the process of assigning credit to different touchpoints in a customer's journey.
Attribution is critical for marketers because it helps them make informed decisions about where to allocate their resources and budget. However, it is not without its challenges.
Why is attribution important in marketing?
Attribution is essential in marketing because it helps marketers understand the effectiveness of their campaigns and the impact of their marketing efforts on their bottom line. By identifying which marketing channels are driving the most sales, marketers can optimise their campaigns and allocate their resources to the most effective channels. This, in turn, can help them increase their ROI and drive more revenue.
However, attribution is not as straightforward as it may seem. Customers often interact with multiple touchpoints before making a purchase, which can make it challenging to determine which touchpoint should get credit for the sale/conversion. Additionally, the rise of multi-channel marketing has made it even more challenging to assign credit accurately.
Challenges faced in getting a reliable attribution model
One of the main challenges faced by marketers when trying to get a reliable attribution model is the abundance of data available. With so much data to analyse, it can be challenging to identify which metrics are most important and which channels are driving the most sales. This can make it challenging to make informed decisions about where to allocate resources and budget.
Another challenge faced by marketers is cookie management. Cookies are small text files that are stored on a user's computer or device when they visit a website. Cookies can be used to track user behavior and provide insights into their browsing habits. However, they also pose a challenge for marketers when trying to assign credit to different touchpoints.
Cookies are often deleted by users, which can make it challenging to track their behavior accurately. Additionally, cookies are limited in their ability to track cross-device behavior. For example, if a customer browses a website on their desktop computer and then makes a purchase on their mobile device, it can be challenging to connect those two touchpoints and assign credit accurately.
In addition to the challenges of abundant data and cookie management, the marketing industry is now facing the "cookie apocalypse." Major web browsers, such as Google Chrome and Mozilla Firefox, are phasing out support for third-party cookies, which are used by advertisers to track user behavior and serve targeted ads. This means that marketers will no longer be able to rely on third-party cookies for attribution and targeting purposes, further complicating the attribution process.
In response to this, marketers need to focus on owning and leveraging first-party data, which is data collected directly from customers and owned by the business. By collecting and analysing first-party data, marketers can gain a deeper understanding of their customers' behaviour and preferences, which can help inform their attribution and targeting strategies.
Data management platforms (DMPs) allow businesses to collect and organize data from multiple sources, including website analytics, CRM systems, and social media platforms, and use this data to inform their marketing strategies.
By leveraging DMPs and first-party data, marketers can create a more holistic view of their customers' behaviour and better understand which touchpoints are driving the most sales.
What's next? Start with data and know your customer
The cookie apocalypse presents a significant challenge for marketers when it comes to attribution and targeting. However, by focusing on owning and leveraging first-party data and utilising data management platforms, marketers can create a more reliable attribution model and optimise their marketing efforts for success in a post-cookie world.
Marketers need to invest in advanced analytics tools that can help them track customer behaviour across devices and channels. By doing so, marketers can improve their attribution models and make better-informed decisions about where to allocate their resources and budget.
Customers are not linear in their decision making and no attribution model is perfect. Understanding customers, their needs and behaviours is key to refining and making key decision on what will drive the most revenue. Without all the pieces and strong data marketers are working blind.
#attribution #firstpartydata #dataandanalytics #datadrivenmarketing #marketing #customercentricity