U-shaped attribution is a marketing term that refers to attributing 40% of conversion credit to the first and last user engagement, with the remaining 20% dispersed amongst other touchpoints.
U-shaped Attribution, also known as Position Based Attribution, is a multi-touch attribution model that is typically used in online marketing strategies. It assigns credit to different customer interactions leading up to a conversion. Notably, 40% credit is attributed to both the first customer interaction point (often a user's first visit to the site) and the last interaction point (the final interaction before a purchase decision). The remaining 20% is evenly distributed across other interactions or touchpoints that occur in between.
Consider a scenario where one of your potential customers interacts with your brand in the following sequence: visits your website through a Google ad (First Interaction), reads a blog post on your site (Middle Interaction), receives an email newsletter (Middle Interaction), and finally purchases a product from your retargeting ad on Facebook (Last Interaction). In a U-shaped Attribution model, the Google Ad and the Facebook Ad would each receive 40% credit, while the two middle interactions- the blog and the email newsletter would share the remaining 20% credit.
U-shaped Attribution is an important concept for understanding and optimizing marketing strategies because it acknowledges the influence of all touchpoints on a customer's purchase decision. It allows marketers to identify the effectiveness and strength of different marketing channels and adjust strategies accordingly. By emphasizing the first and last customer interaction points, it inherently credits the awareness and closing stages, typically the most critical stages of the decision-making process.
Improving the U-shaped attribution requires a thorough and continuous analysis of the attribution data followed by strategic adjustments. Regularly testing and modifying the outdoor marketing strategies, tracking all potential touchpoints, and tweaking them based on performance can significantly improve the attribution model.
The effectiveness of U-shaped attribution can potentially be influenced by a variety of factors, including but not limited to advertising channels, content quality, frequency of interaction, customer behavior, and market competition. Marketers need to stay on top of these factors to ensure the best attribution results.
U-shaped attribution can impact many eCommerce metrics. For instance, a high-converting first or final touchpoint would increase conversion rates. Additionally, recognizing the role of each touchpoint can improve the return on advertising spend (ROAS) by enabling more informed budget allocation decisions. Furthermore, noting the customer interactions can generate insights into customer behavior and preferences that can be used to enhance customer lifetime value (CLV).