What Is an Attribution Model? (With Benefits and Tips)
By Indeed Editorial Team
Published 24 October 2022
The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.
Marketers use various methods to analyse customer behaviour and improve their advertising strategy. Some marketers use attribution frameworks to personalise advertising efforts for potential customers and increase revenue. Learning about the model can help you understand how to apply it and allow a company to improve its customer conversion rate. In this article, we define an attribution model and list eight types of attribution frameworks to apply in your marketing campaign.
What is an attribution model?
An attribution model is a framework marketers use to analyse marketing channel interaction points or touchpoints that convert prospects to customers. Touchpoints are usually locations and types of interactions with prospects. Businesses use them to determine where a member of the target audience becomes a customer on the consumer journey. A consumer journey starts when the prospect lands on the product or service, interacts with the brand and ends in continuous support.
An example of a touchpoint is when a customer adds an item to a digital wish list, clicks on a digital ad or comments on a social media post. Businesses use attribution marketing models to determine which marketing channels are more valuable in convincing prospects to convert to customers. It also helps marketers invest their budget on advertising channels with more conversions. There are two major categories of attribution marketing models. They include:
Single touch models: These are models that credit one touchpoint in the consumer journey for converting the customer, such as the consumer's first interaction with an advertisement or their last action before making a purchase.
Multi-touch models: These are models that credit two or more touchpoints for converting a prospect to a customer.
8 types of attribution models
Here are eight types of attribution frameworks marketers use:
1. First interaction attribution
First interaction, first-click or first touch attribution is a single touch model that credits a user's first interaction with the business for converting the user to a customer. For instance, if a prospect clicks a referral link which redirects them to the company's official website before they make a purchase, the first touch attribution method credits the referrals for the conversion. The first interaction attribution framework provides simple data collection and analysis. It's an ideal model for companies that convert customers quickly or have an assured buying cycle. First-click models also help businesses to increase leads for potential customers.
2. Last interaction attribution
Last interaction, last touch or last-click attribution is a single touch attribution framework that credits user conversion to their last interaction with the business before making a purchase. Many companies use the last touch model as their attribution framework because it's easy to analyse. If a customer enhances their online security settings, collecting data about the customer journey may be hard, but it's easy to determine their last touchpoints before conversion. Last interaction attribution is ideal for businesses with a short buying cycle or prospects close to making a purchase.
3. Last non-direct touch attribution
The last non-direct touch attribution or last non-direct click attribution is a single touch framework that ignores direct interactions before conversion. Direct interaction is when a user directly searches the company's site by typing its name or URL on their browser or using links they bookmark. Users that make direct interactions already know about the business.
Last non-direct touch attribution focuses on indirect interactions, such as when a user gets to the business's website by clicking a link on another site. The framework helps companies understand how customers learn about or engage with the brand before purchasing. It's ideal for companies with a short buying cycle.
4. Linear attribution
Linear attribution is a multi-touch framework that equally credits the conversion to all the interactions in a customer's journey. For example, a user can view a company's social media, visit its blog to analyse various products and subscribe to the newsletter before making a purchase. The customer has made four interactions with the business before making a purchase. In linear attribution, each interaction gets 25% credit for the customer's conversion. Marketers can easily explain linear attribution to clients, but it might be challenging to compare the performance of different channels in the conversion process.
5. Time decay attribution
Time decay attribution is a multi-touch framework like linear attribution that credits various user interactions for customer conversion. The time decay model differs from the linear attribution method because it gives interactions different values rather than equal credits. Time decay attribution gives more conversion credits to cash points closer to a customer's first purchase. It's an ideal model for businesses with long sales cycles, such as B2B purchases. The model may also help marketers determine a more effective strategy for increasing engagement and building lasting relationships with prospects.
6. Position-based attribution
Position-based or U-shaped attribution is a multi-touch model that gives conversion credit to all of the user's interactions with extra credits to the first and last interactions. For example, a market analyst can give the first and last interaction 40% conversion credit and divide the remaining 20% among other interactions in the customer journey. A U-shaped attribution framework is ideal for businesses with multiple interactions. It helps evaluate specific touchpoints and determine their order before conversion.
7. Algorithmic attribution
Algorithmic or data-driven attribution is an attribution framework that doesn't reveal how it collects or calculates data. It uses machine-learning tactics to give fractional credit for many interactions. Platforms that use algorithmic attribution prefer not to share the interactions they consider in the algorithm or reveal how much value they give each interaction. Third-party distribution algorithms don't give businesses as much information as other models, but they can help simplify business processes.
8. Custom attribution
Custom attribution is where marketers create a special attribution system for the company. They determine which customer interactions to include in the custom algorithm and the conversion value for each interaction. Many companies hire external analytics companies to create a custom attribution system. The business requires significant touchpoint data to create an effective custom attribution framework.
Benefits of attribution framework
Marketers and businesses realise the following benefits of implementing attribution frameworks in marketing campaigns:
Improves marketing strategies and campaigns: Marketers use attribution frameworks to evaluate various factors, such as marketing channel design elements and messaging styles that are more likely to convert prospects into customers. It helps marketers focus on improving marketing tactics with high conversion rates.
Increases return on investment: Marketers use attribution frameworks to determine marketing channels and strategies that effectively convert prospects into customers. Businesses improve their return on investment when they reach their target audiences through effective channels and strategies.
Personalises messages and channels for potential customers: Customers prefer to use different engagement or marketing channels. Marketers use attribution frameworks to create custom advertising campaigns for specific groups in the target audience.
Improves the cost efficiency of marketing strategies: Attribution frameworks help marketers identify cost-effective marketing channels or campaigns with a significant conversion rate. Marketing teams analyse these frameworks and reassess their budgets to support effective marketing efforts and reduce operational costs.
Tips for using an attribution framework
Here are some tips marketers can use to select an attribution framework that suits the company's products or services:
Determine the company's sales cycle. If the business has a short sales cycle, consider a single-touch attribution framework because customers don't have many interactions before purchasing a product or service. Consider multi-touch models for brands with long sales cycles.
Adapt the framework to your resources. There are attribution frameworks for small and large companies. If you have a small company or marketing team, use a simple attribution framework like the last touch, which provides valuable information while giving the marketing team little work.
Use an omnichannel model. If the business has many in-person and online touchpoints, consider combining the models into an omnichannel strategy. You can use an analytics program to create a custom framework that combines features of various models.
Choose a model depending on the result you want. Many marketers use a simple model and upgrade it with time but consider the results you want when selecting an attribution framework. For example, if you want new users to choose a model that focuses on the early stages of the customer journey, you may use the first touch model, or if the brand wants to convert potential customers who already know about the brand, consider using the last click model.
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