Published On: 18 Jun 2023
Navigating the dynamic and multi-layered world of ecommerce can feel like walking through a maze without a compass. Every click, every ad, every email—it all leads to the ultimate goal of conversion. But which of these myriad touchpoints is most influential in guiding the customer to make a purchase? The answer to this question lies in marketing attribution models.
Marketing attribution is the Rosetta Stone of ecommerce marketing—it decodes the complex customer journey, providing invaluable insights into the effectiveness of various marketing channels and tactics. Yet, not all attribution models are created equal. Different models offer different perspectives, and choosing the right one can dramatically impact your understanding of your marketing ROI.
Among the myriad attribution models available, two stand out for their widespread usage and distinct perspectives: single source attribution and multi-touch attribution models. The single source model simplifies the customer journey to a single pivotal touchpoint, whereas the multi-touch model embraces the complexity, attributing conversion value across multiple touchpoints.
But which one is right for your business? Does the simplicity of the single-source attribution model hold the key to understanding your conversions, or does the comprehensive perspective of multi-touch attribution models offer more valuable insights? This blog post aims to unravel the intricacies of these two models, comparing their advantages and disadvantages to help you make an informed decision. Let's dive in and uncover the power of marketing attribution.
The single source attribution model, often referred to as the "last click" or "first click" model, attributes all credit for a conversion to a single touchpoint. In essence, it simplifies the customer journey down to one key interaction—either the very first or the very last one that led to the customer's decision to purchase.
Let's further break down these two main types of single-source attribution models:
This is the most commonly used form of single-source attribution. It assigns 100% of the conversion value to the last touchpoint before the purchase. For instance, if a customer clicked on a Google Ad, then an email link, and finally a Facebook ad before making a purchase, the last-click model would assign all credit to the Facebook ad.
As the name suggests, this model gives all the credit to the first interaction that a customer had with the brand. If a customer first discovered your brand through a blog post, then interacted with a series of social media posts, and finally clicked on an email link before making a purchase, the first-click model would attribute the conversion to the blog post.
The single source attribution model offers a clear and straightforward method for tracking conversions, making it a popular choice, especially for businesses new to the world of marketing attribution. However, while its simplicity can be advantageous, it often oversimplifies the customer journey, neglecting the influence of other touchpoints that may play a crucial role in the customer's path to purchase.
In the next sections, we'll further delve into the advantages and disadvantages of this model to provide a comprehensive understanding.
Despite its simplicity, single source attribution models offer several advantages that make them appealing to marketers.
While single source attribution models offer simplicity and clarity, they also have several limitations that businesses should consider:
Now let’s look at the multi-touch attribution model.
As opposed to single-source attribution, multi-touch attribution models recognize that customer journeys often involve multiple touchpoints, all of which contribute to the final conversion. The primary idea behind multi-touch attribution is that it attributes the conversion value across all interactions a customer has with a brand before making a purchase, thus providing a more holistic view of the customer journey.
There are several types of multi-touch attribution models, including:
This model gives equal credit to each touchpoint in the customer's journey. For example, if a customer interacts with a brand through a blog post, a social media post, an email, and a search ad before making a purchase, each of these touchpoints would receive 25% of the credit for the conversion.
In this model, the touchpoints closer to the time of purchase receive more credit. The logic here is that the actions closer to the conversion are likely more influential in the purchasing decision.
This model assigns 40% of the credit to the first and last touchpoints, and the remaining 20% is distributed evenly among the other touchpoints. This acknowledges the importance of the first interaction that piqued the customer's interest and the last interaction that finally led to the conversion, while still giving credit to the touchpoints in between.
This model assigns 30% of the credit each to the first interaction, the interaction where the lead was created, and the final interaction before the purchase. The remaining 10% is spread across any other touchpoints.
However, these models can also be more complex and require more data to implement effectively. As with the single source attribution model, the next sections will dive deeper into the advantages and disadvantages of multi-touch attribution models.
The comprehensive nature of multi-touch attribution models presents several advantages to businesses looking for a holistic view of their marketing efforts.
While multi-touch attribution models offer these advantages, they are also more complex and require more data than single source models. Therefore, it's important for businesses to consider their specific needs, resources, and capabilities before choosing to implement a multi-touch attribution model.
Although multi-touch attribution offers a more detailed view of the customer journey, there are a few challenges to be aware of:
In essence, while Single Source Attribution provides an uncomplicated view of conversion paths, its oversimplified nature might distort the true impact of your marketing efforts. Conversely, Multi-Touch Attribution shines in today's complex marketing landscape, acknowledging every touchpoint in a consumer's journey. Although it's more complex, tools like Lifesight, an eCommerce growth platform, simplify this process.
Lifesight's robust attribution model helps businesses navigate and interpret their marketing data, thereby enabling them to optimize campaigns more effectively. If you're seeking a more accurate and holistic view of your customer journey, then consider embracing Multi-Touch Attribution with Lifesight. It's time to upgrade your marketing strategy - sign up for Lifesight and unlock a new level of insight into your customers' journey. The better we understand our consumers, the better we can serve them. Don't delay, start your Lifesight journey today.
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