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Attribution Models and Why They’re So Important – A Deep Dive7 min read

December 20, 2022

(Note: This is a part of a series on ‘Attribution modeling’ and ‘Attribution Trap’ inspired by Mr Jagadeesh J, Vice President, Unacademy)

Ever since the world of digital marketing exploded, marketers have worked day and night to understand which channel has brought them the most amount of business. After all, every marketer would ideally like to allocate his marketing spends to the channel that brings him the maximum sales. However, throughout the buyer journey, there are usually multiple channels and digital touchpoints where potential leads can turn into paying customers, and attributing a sale to the correct one is essential for the success of any campaign. Where did the customer first engage with your brand? How did he discover the products he wanted to purchase? And finally, what pushed him/ what was his trigger to make the final payment and purchase the product?

If you’re able to discover the answer to this question – you would be able to optimise your campaigns and marketing funnel efficiently and tap into the right audience at the right place. In simple words, Attribution is similar to a game of football. You might think that it is Messi who scored a goal for FC Barcelona but it is actually the effort of the entire team who passed the ball from player to player and created the right possibilities for a goal to occur.

Similarly, in digital marketing, it is not only the last touchpoint but the entire journey which needs to be evaluated and given due credit. ‘Attribution Trap’ here, refers to the misappropriation of attribution. It means prioritizing the last touch credit over true incrementality, undermining and under-investing the truly impacting variables in the process

Let’s first understand the various types of attribution models and their significance.

1. First-click attribution

First-click attribution is wherein all credit of a final conversion/purchase is given to the very first interaction your business had with a customer.

2. Last-click attribution

On the other hand, the last-click attribution model gives all of the credit to the last interaction your business had with a customer before they convert/make a final purchase. This model gives weightage to the last touch point in the customer journey and gives it all the credit for the conversion.

However, accurate attribution is not that straightforward. Prioritizing the last click undermines the impact of the marketing funnel prior to the last click. We must remember – The last click exists because the first click does. Hence, just like Messi on the football field, the credit for the final goal should go to the entire team, or in this case, the entire marketing funnel.

3. Last Non-Direct Click Attribution

The last non-direct click attribution models give 100% of the credit to your customer’s last non-direct touchpoint. Non-direct traffic is all traffic that’s been guided to your website from another source.

For example, if a user receives one of our monthly newsletters in his inbox, clicks on our website and browses around, and then a week later goes directly to our website and signs up, then in this scenario, the newsletter should get all the credit. 

4. Linear Attribution

In the Linear attribution model, the credit is divided equally amongst all touchpoints in a customer journey. If there were 5 touchpoints in the customer journey, each of those points would get 20% of the overall credit for that sale.

For example, when a customer sees our ad on Facebook, signs up for our monthly newsletter, and clicks on a website link in the newsletter. Then the next week, suppose the customer goes to our website directly and signs up. This means – there are 3 digital touchpoints in this situation and each would get equal credit.

5. Time Decay Attribution

This is similar to the “linear attribution” model in a way but in the Time Decay attribution model, the touchpoints closest in time to the sale or conversion get most of the credit. In this particular case, the campaign through which the purchase happened would receive the most credit.

6. Position-Based Attribution

In the Position-based attribution model, 40% of the credit is assigned to each – the first and last interaction, and the remaining 20% of the credit is distributed evenly to the middle interactions. Like in the above example, the first and the last interacted campaign got 40% credit each.

For example, if a prospect first makes contact with our business through a Google organic search, clicks on one of our Facebook posts and signs up for our monthly newsletter, then signs up on our website after clicking on the email, the first (organic search) and third touch (email) each receive 40% of the credit, and the Facebook click receives the remaining 20%.

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