- Mar 03, 2023
Attribution is the process of assigning credit to different marketing touchpoints along the customer journey for their contribution to a conversion or sale. Marketing mix modeling (MMM) is a statistical analysis that helps to measure the impact of various marketing channels and tactics on business outcomes such as sales, revenue, and customer acquisition.
By combining attribution and MMM, marketers can gain a more comprehensive understanding of how their marketing efforts are working and optimize their marketing mix accordingly. Here are some ways attribution can improve marketing mix modeling.
Get to the Finer Details With Your Insights
Attribution – particularly multi-touch attribution (MTA) – allows marketers to identify the specific touchpoints, or combination of touchpoints, that contributed to a conversion. This granular level of detail can help marketers understand which channels and tactics are most effective and which ones are not. This information can be used to optimize the marketing mix, making it more efficient and effective.
Unlike single-touch attribution models that give all the credit to a single touchpoint, MTA models consider all the touchpoints that a customer interacts with on their path to purchase. Multi-touch attribution provides granular insights in several ways:
- Identifying the most effective touchpoints: MTA can identify the touchpoints that have the highest impact on conversions. By analyzing the data on all touchpoints that customers interact with, it can provide insights into which touchpoints are the most effective and contribute the most to conversions.
- Understanding the customer journey: MTA models provide a more complete picture of the customer journey by tracking all the touchpoints that customers interact with. This can help marketers understand the various stages of the customer journey, such as awareness, consideration, and decision-making. It can also provide insights into how customers move between different channels and touchpoints.
- Optimizing the marketing mix: MTA can help marketers optimize their marketing mix by understanding the impact of different touchpoints on conversions. By identifying the most effective touchpoints, marketers can allocate their budget more effectively, prioritize the channels and tactics that are working best, and adjust their campaigns to optimize the customer journey.
- Testing and experimentation: MTA can be used to test and experiment with different marketing strategies. By measuring the impact of different touchpoints on conversions, marketers can identify opportunities for improvement and run experiments to test different tactics and channels.
MTA provides granular insights by tracking and analyzing all the touchpoints that customers interact with. By understanding the impact of each touchpoint on conversions, marketers can optimize their marketing mix, improve the customer journey, and drive better business outcomes.
By attributing credit to different touchpoints, marketers can better measure the impact of individual marketing channels and tactics. This information can be fed into the marketing mix model to improve its accuracy and reliability. MTA improves measurement in several ways:
- Provides a more complete picture: It considers all touchpoints that a customer interacts with, from the first click to the final conversion, giving a more complete picture of the customer journey. This allows marketers to understand which channels are most effective at driving conversions and which are not.
- Helps optimize marketing spend: By understanding which touchpoints are most effective, marketers can allocate their budget more efficiently to the channels that drive the most conversions. This can help optimize marketing spend and improve return on ad spend (ROAS).
- Helps identify gaps and opportunities: MTA helps identify gaps in the customer journey where customers may be dropping off or not engaging. This can help marketers identify opportunities to improve the customer experience and increase conversions.
- Provides insights into customer behavior: MTA provides insights into how customers engage with brands and what motivates them to make a purchase. This information can be used to improve marketing messaging and product offerings.
More Accurate Budget Allocation
Attribution can help marketers determine how much budget to allocate to each marketing channel and tactic. By understanding the contribution of each touchpoint to conversions, marketers can optimize their budget allocation to maximize ROAS. Here are a few ways multi-touch attribution can improve marketing budget allocation:
- More accurate measurement: MTA allows marketers to measure the impact of each marketing touchpoint on a customer’s journey. This means that they can see which channels and tactics are driving the most conversions, and adjust their budgets accordingly.
- Improved optimization: With a better understanding of how each marketing touchpoint is contributing to conversions, marketers can optimize their campaigns to improve performance. For example, if they see that a particular channel is driving a lot of clicks but few conversions, they can adjust their messaging or targeting to improve results.
- Increased ROAS: By allocating budgets more effectively, marketers can improve the return on ad spend (remember, that’s ROAS) of their campaigns. They can focus their spending on the channels and tactics that are driving the most conversions, rather than investing in channels that may be less effective.
- Better decision-making: With attribution, marketers have access to more data about their campaigns, which can help them make more informed decisions. They can see which channels and tactics are working best for different customer segments, and adjust their strategies accordingly.
- Improved collaboration: MTA can help teams work together more effectively, as everyone has access to the same data. This can lead to better communication and collaboration across teams, which can lead to better results overall.
- Improved forecasting: Attribution can provide valuable insights into the impact of marketing efforts on future sales. These insights can be used to improve forecasting accuracy and enable marketers to make data-driven decisions about future marketing investments.
Multi-touch attribution can help marketers gain a more accurate and granular understanding of how their marketing efforts are impacting business outcomes. By incorporating attribution data into MMM, marketers can optimize their marketing mix and improve the effectiveness of their marketing campaigns.