Are you wasting your marketing money?
You are in charge of your company marketing budget. You invest a fair amount of marketing money in a vast ecosystem of partners, ad networks, and affiliates.
- Your paid search manager is asking for more budget, based on an analysis made by Google that shows how efficient this investment would be.
- Your affiliate marketing manager is explaining that pushing more coupon codes to the affiliates generate immediate higher returns (and she needs more budget for that).
- Your display manager needs more budget because advertising on the home page of this specialized online magazine raises your brand awareness.
You listen, crunch numbers and take the appropriate decision: the only budget hike will be for the most profitable option, paid search. Just like most advertisers, your reporting is based on a last-click attribution model. With this type of model, the most profitable campaign you’ll ever run is advertising your brand through search engines. Once you get a user to type your brand in Google, there’s a pretty good chance that he/she already knows your products and that he/she has made up his mind to buy it on your site. Therefore you increase your pay per click investment in search engines.
What happened prior to that last click before the sale?
Imagine the number of interactions between your brand and a user before this user is actually doing that last click to purchase. Let’s take the antivirus industry (I have many clients in this space). Before you are able to sell a multi-device protection to an end-user, you need to make quite a few contact points before he tries the security software on his devices, and then quite a few more before he finally buys it. All these contact points need to be orchestrated in a world where the user switches from his mobile phone to his office computer, and then to his tablet, and guess what, he only read his emails on his connected watch. These contact points are made online but also over the phone thanks to customer care agents, offline with print advertising, TV or radio ads etc.
User journeys are multi-device and omni-channel. Your marketing campaign needs to be as well, and they need to be articulated on a broad number of supports!
The marketing dream team
Marketing levers operate as a team. Some act as initiators: they expose new prospects to your offer, raise your brand awareness, and generate a first visit to your website (e.g. display ads, print, TV or radio commercials usually followed by a search on Google). Then come the influencers, which help users ripen their intention to buy. At this stage users will be gathering information about the product, evaluating it, comparing it with your competitors. Influencers are typically paid-search campaigns with keywords related to your product features or editorial affiliates publishing an article about your product. Finally, some levers act as finishers and bring in users who are making the purchase: email, branded paid-search and display retargeting campaigns are champions here. Another popular approach to this Initiator — Influencer — Finisher concept is AIDA: Awareness — Interest — Decision — Action.
Positioning your dream team
Marketing levers operate as a team. Some levers are complementary, some are competing with each other, some are efficient, some are not. The difficulty lies in figuring out and measuring these efficiently. Attribution and contribution are your best friends… if you don’t get lost in the way.
Attribution is giving credit for a sale to one or many levers in your marketing mix. Attributing revenue to a lever that generated it allows you to calculate the return on ads spend (ROAS) by dividing revenue with investment.
- The last touch model grants 100% of the revenue to the last lever before sale.
- The first touch model credits 100% of the sale revenue to the lever that exposed the client for the very first time.
Looking at different attribution models allows you to understand the contribution of each lever in your marketing mix: last-click model reveals the “finishers”, first-click reveals the “initiators”.
This is how you can position your marketing levers team: identify clearly which lever plays which role, make sure they are efficient in their role, and take your budget decisions in regards to this role. For example, raising your paid search investment may not be the best choice if you’re looking for initiators.
What is the best attribution model?
First touch? V-shape multi-touch? Linear multi-touch?
The answer is none. Each model is like a window to apprehend reality from different points of view, but never reveals the whole picture. Understanding the contribution of your marketing investment is like looking through each of these windows and then reconstructing the full picture.
Nonetheless, it is important to choose one model and stick to it. Your reporting needs consistency over time so that you can analyze the evolution of the results. You still may have to evaluate the contribution of each lever on a regular basis by looking at the other attribution models. The understanding of contribution then can be done with other types of analysis as well (profile changes, lever sequence…).
The way to attribution and contribution
The first requirement is proper tracking. All your campaigns (links, impressions) and website need to be tracked properly, with one single tool. This will allow you to deduplicate sales among your different levers and enable attribution modeling. Don’t neglect post-view tracking, especially if you are investing in display. Your prospecting banners are viewed, not necessarily clicked. You need to know whether being exposed to a banner has an impact on your prospects or not.
Selecting & deploying the right solution
Choosing the right attribution tool isn’t an easy task as there are plenty of vendors, with different approaches: the expensive ones (Adobe), the black-box one (and expensive too!) (Visual IQ), the hands-on ones (Eulerian, Tag Commander, Mazeberry…), the new ones (Google 360). I guess the budget is the first thing to consider. The cost of the solution shouldn’t exceed the gain you expect from optimizing your marketing budget using it. If the solution costs more than 10% of your marketing investment, you should probably look in another direction to make it more cost-efficient.
