In today’s fast-paced digital landscape, marketing isn’t just about firing off campaigns in one channel and hoping for the best. Oh no, it’s a wild, multi-stop journey with potential customers darting through various touchpoints, such as ads click, direct click, or organic search. And you cannot track all of these manually. You need a tool that can assist you, and a model that is suitable to analyze your marketing activities. This is where the digital marketing attribution model steps in the game and helps you with it.
In this blog, we’ll guide you through everything you need to know about the digital marketing attribution model. We’ll start with a simple explanation of what they are, then explore the different types of attribution models available. Finally, we’ll provide you with tips on how to choose the best attribution model for your business. So, find a comfy spot and join us as we delve into our topic today
Table of Contents
What is the marketing attribution model?
Marketing attribution helps you track all of the touchpoints of customers to your digital marketing channels and gives credit to the one that has an impact on your sales. The ways the attribution gives credit to each channel will depend on the framework that you use. That framework is the so-called: Marketing attribution model.
Various marketing attribution models provide different insights into which channels are contributing the most to your store’s sales. For example, let’s say a customer makes a purchase from your store, With the help of marketing attribution, you can track the channels they interacted with during their decision journey. Depending on the attribution model you use, the credit for the sale can be assigned solely to the first channel, the last channel, or evenly split among all three channels.
Why do we need marketing attribution models?
Choosing the right model that matches your goals can bring many advantages to your business. Let’s explore some of the most important benefits you’ll enjoy when you use an appropriate marketing attribution model:
Save your spending on marketing activities
The attribution model assists your business in allocating the marketing budgets more effectively. They enable you to identify which campaigns are working effectively, so you can invest more in those channels and improve sales numbers. By implementing this approach, you can conserve resources and maximize return on investment (ROI).
Let’s look at an e-commerce bakery equipment business. They spent a lot on Google Ads but weren’t sure if it boosted sales. Hence, they decide to use attribution modeling that is suitable to their business goals. And by doing this, they realized that most conversions started with Facebook ads and then Google searches. With this insight, they shifted the budget to Facebook ads, saving money while maintaining sales.
Improve campaign effectiveness
Attribution models provide crucial insights into the effectiveness of marketing efforts at different stages of the customer journey. These insights enable businesses to fine-tune their campaigns, optimizing their strategies for better results. This approach helps allocate resources more efficiently and ultimately fosters brand loyalty and sustained success.
Now, let’s keep talking about that bakery equipment-selling business. After they used their marketing attribution model, they found out that their top customers first found them through organic search results. With this info, they realized they should put more effort into SEO. When they made this change, their organic traffic and conversions went up, and it worked out great!
Customize the experience of customers on their journey
By using the right marketing attribution model, you can refine your marketing strategies by tailoring messages specifically to individual customers. And guess where the messages come from? Yes, you have the data right from the customer’s unique interaction history. When customers receive content that resonates with their prior interactions and preferences, it naturally sparks their interest and encourages them to engage with your brand.
Let’s stick with our bakery tools example. When they used marketing attribution models, the marketing team saw that most customers found their store through Pinterest. They also found out that Pinterest users loved their cookie cutters the most. So, to sell more, the business started running more sales programs for those popular products.
Measure the long-term impact
By using the right attribution models, you can look at the whole customer journey, even if it takes a long time for someone to buy something. This helps your business understand all the different interactions that influence a customer’s decision, starting from when they first learn about a product to when they actually make a purchase. When you see how each interaction matters in the customer’s journey, you can make better decisions.
For instance, in the case of our bakery equipment store, they noticed that lots of customers started with small buys like baking utensils and then moved on to bigger purchases. By knowing this journey, the business could tweak its marketing and offers to bring folks back and encourage them to buy more.
Types of marketing attribution models
The marketing attribution model has lots of variety that businesses can use flexibly for their own purposes. Each model has its own way of looking at different touchpoints and customer journeys. Here are some of the most common and easy-to-use models for tracking your marketing campaigns:
First-click attribution model
Firstly, we’ll talk about one of the single-touch attributions: The first-click attribution model. If you use the first-touch attribution model, you’re assuming the first channel that leaves an impression on customers is what counts the most. So, you give all the credit to the very first marketing channel that a customer bumped into.
This model is extremely handy when you want to know which campaigns are attracting new customers and capturing their interest. Also, if you have a new marketing channel and you want to test it out, this model will also be optimized for this objective.
For example, you’re a new e-commerce store that sells shoes. You have a new shoe model, and your goal now is to let everybody know that it’s available within your store. So, you run a marketing plan with the objective to increase the awareness of the customers and reach out to as many people online as you can.
You decide to use the first-click attribution model and find that despite various channels in the customer journey, most people’s first impressions come from TikTok ads. Therefore, now you need to focus on TikTok ads to achieve this marketing goal.
| Advantages | Disadvantages |
| – Easy to apply into practice – Useful for businesses that are focused on brand awareness or lead generation | – Ignores the influence of other touchpoints on the conversion – Doesn’t account for the complexity of the customer journey |
Last-click attribution model
In contrast to the first-touch attribution model, the last-touch model allocates 100% of the credit to the last marketing touchpoint. Even if your customers interact with multiple channels, it considers only the last thing they clicked on or saw. This model can be really handy when you only want to focus on the conversion, or you just want to simplify your data.
Imagine this: You’re running a discount for your gaming mice, and you decide to promote this news through channels including TikTok ads, Google ads, and email marketing. Your customers have a really complicated journey, as they run back and forth in these channels until they finally decide to make a purchase.
However, in this case, the only thing you care about is which channel directly leads to the conversion during this discounting season. By using the last-click attribution model, you have highlighted the channels that have the most responsibility for converting your potential customers quickly.
| Advantages | Disadvantages |
| – Easy to apply into practice – Useful for businesses that are focused on driving conversions | – Ignores the influence of other touchpoints on the conversation – Doesn’t account for the length and complexity of the customer journey |
The last non-direct click attribution model
The last non-direct click is really easy to understand, as the name itself says everything. This model gives credit to the last thing a customer saw before they bought from your store through a direct click. You can use this attribution when you want to focus on the channels that probably leave a strong enough brand impression that customers can search for your name right away.
For example, a business uses this model to track the effectiveness of its marketing campaigns. The business finds that email is the last non-direct interaction before customers make a purchase. So, by using this attribution model, 100% credit will be given to email, as this is most likely to have a direct impact on customers’ impressions before their purchase.
| Advantages | Disadvantages |
| – Track the effectiveness of marketing campaigns at the end of the customer journey – Have a chance to which marketing channel leave a strong impression that customers can remember your store’s name | – Track the effectiveness of marketing campaigns at the end of the customer journey – Have a chance to which marketing channel leaves a strong impression that customers can remember your store’s name |
Linear attribution model
The Linear Attribution Model is quite straightforward. It distributes the credit for a sale equally across all the steps a customer takes before making a purchase. It doesn’t pinpoint which step had the most impact, making it a great starting point if you’re unsure which step matters most in the buying journey. However, it’s important to periodically reevaluate the impact of each marketing channel over time.
| Advantages | Disadvantages |
| – Easy to use and apply into practice – Suitable for businesses who are unsure of which step matters most – Provide insights into the overall effectiveness of your marketing campaigns | – Doesn’t take into account the varying levels of impact that different touchpoints can have – Doesn’t account for the timing or sequence of touchpoints |
Position-based attribution model
The position-based attribution (or U-shaped model) model gives most credit to the first and last customer clicks, while everything in between shares the credit equally. So, if your attribution can track 3 touchpoints, the first and last each gets 40%. The remaining middle one will get 20% ultimately. If there’s only one touch before a sale, it gets all the credit, and if there are only first and last touches, they each get half.
This model works well if you really value the credit of the first and last touchpoints in the customer journey. However, you also want to account for the long-term impact of marketing touchpoints.
For example, your online clothes business is running marketing campaigns on 3 channels: TikTok ads, Google ads, and email. Using this model, you see that TikTok ads and email are the first and last channels in the customer journey. However, you still take into account Google ads. The reason is that without this channel, your customers may never find your store and subscribe to your email newsletter. It doesn’t have a direct impact on conversion, but still an important channel for your long-term plan.
| Advantages | Disadvantages |
| – Doesn’t overemphasize the importance of the early and late touchpoints – Good choice for businesses that focus on lead generation – Can see other channels that impact the long-term marketing result | – Doesn’t take into account the length of the conversion path – The credit may not be equivalent to the real number |
Time decay attribution model
If someone clicks on many channels before making a purchase, then in the time decay model, the clicks that happened closer in time to the purchase will get more credit. The first click will be allocated the least credit in this model. Imagine customers see your TikTok ads first, then Google ads when they search, and finally click an email before buying. Credit is split like this: TikTok gets the least, email gets the most.
This attribution model is probably the only one that considers the importance of the time order. Therefore, you can track even products with a really long sales cycle. Some businesses find it useful, however, as the credit spreads out to all channels, it may not allow you to bigger picture compared to other models.
| Advantages | Disadvantages |
| – Consider the time order of the channels – Great for products with long sales cycles | – Hard to find the exact decay rate – Hard to allocate the exact credit for each touchpoint |
Data-driven attribution model
If you’re using a data-driven attribution model, it’s like crafting your own rulebook for assigning credit to your marketing actions. This model allows you to leverage machine learning to determine which touchpoints deserve the highest credit. It’s highly adaptable and fully customizable, making it an ideal choice for businesses with abundant data and deep insights into their customers’ purchasing behaviors.
| Advantages | Disadvantages |
| – Most accurate as it is tailored to the specific needs of the business – Can be used to measure the impact of all marketing channels | – More expensive to implement and maintain than off-the-shelf attribution models – More complex to set and use |
How to choose the best marketing attribution model?
Now, we understand all the attribution models that can be used to track and analyze the impact of our marketing campaigns. However, not every model will be suitable for your business. Therefore, you should choose one based on your business objectives and the marketing channels you are using. Here are some tips for selecting a marketing attribution model:
Set clear goals for your marketing campaigns
Another important thing you need to do is know what you want to achieve. This will be the navigation so that you will always go the right way. Want more sales, better brand recognition, or more loyal customers? Your goals will steer you toward the right model.
Understand your industry
Every industry is unique, and they need different marketing strategies. Each industry also has its own best ways to get customers to buy. So, to make your marketing model work best for your business, make sure you know a good bit about how marketing works in your industry.
Know your customer journey
Think about how your customers do their thing before buying. Do they click around a bunch, or do they usually buy after one click? By determining these factors, you can have an overview of your customer journey
Take into account the sales cycle length
If your sales cycle is on the longer side, go for an attribution model that can keep up with it. Models like time decay are great for tracking interest that builds up over time.
Count your touchpoints
Another important thing to consider is how many touchpoints you offer to customers. If you have just 2-3 touchpoints, a simple attribution model can work fine. But if you have more, it might mean your customer journey is more complex. In that case, your attribution model needs to handle this complexity to provide better analysis. It’s like using the right tool for a more intricate job!
How to measure performance with attribution modeling
To start measuring your performance with attribution models, it’s a good idea to grab yourself some marketing attribution software. This tool will be your buddy, collecting data from all your marketing stuff, like your website and social media. With this data in hand, the tool will figure out which channel is making the most significant impact on your conversions, based on the attribution model you pick.
Try out NestAds – our marketing attribution software that can make finding customer insight so much easier. Along with the common attributions that we mentioned above, NestAds also provides you with a new attribution solution: the NestAds attribution model.
It’s our own way of allocating credit to channels contributing to the customer decision journey. With this model, will be given 100% to the last ad interaction per ad channel. With this attribution, you can see which channels are impacting the decisions of customers and planning a more effective customer journey.
So, there you have it – another option that you can choose to elaborate your analysis! So, get ready to do some experiments with our NestAds, and find out all the magic that a suitable attribution model can bring to you!
