Fractional Attribution is a marketing analytics model which allocates credit across multiple touchpoints in the customer journey.
In traditional ecommerce analysis, marketing specialists often lean towards 'last-click' attribution — where the final touchpoint before a sale gets all the credit. However, this method ignores the role played by various other interactions leading up to the sale. This is where Fractional Attribution sets in; it attempts to break down and distribute the credit of a sale across multiple touchpoints the customer interacted with during the conversion journey, thereby providing a more holistic understanding.
For instance, a customer might first encounter an ecommerce store via a Google Ad (First Touch), later receive an email campaign (Middle Touch), and finally make a purchase after interacting with a Facebook Ad (Last Touch). In a Fractional Attribution model, all these touchpoints would get a share of the sale credit.
Fractional Attribution bridges the gap between different marketing techniques and their actual impact on the consumer’s purchase decision, providing a comprehensive view of what works and what needs improvement. It helps give credit where it's due and optimizes the marketing channels' efforts by ensuring the allocation of budget and resources is data-driven.
Improvement can be made by refining the logic of dividing credit among touchpoints. This can be based on factors like engagement metrics, recency of interaction, or even custom business rules (performance-based, for instance). Additionally, with continuous monitoring and updating the model as per the latest customer interaction trends, the accuracy of Fractional Attribution can be enhanced.
The efficiency of Fractional Attribution largely depends on the nature of the marketing channels, the buyer's journey, the number and frequency of touchpoints, the conversion path followed by a consumer, and the chosen attribution model.
Fractional Attribution is intrinsically linked to metrics like Return on Ad Spend (ROAS), Customer Acquisition Cost (CAC), and Lifetime Value (LTV). The allocation of credit influences the calculation of these metrics, thereby impacting the overall understanding of marketing performance.