Understanding Attribution – Who Gets the Credit For The Conversion
Last week I discussed about the importance of being very familiar with your Key Performance Indicators (KPI) throughout the different stages of your sales funnel. Today, I will expand even further by getting into one of the most coveted words in the world of marketing and digital advertising. The word is ATTRIBUTION.
Every agency claims to be a rock star when it comes to taking credit for as many conversions as they can. But are they really as good as they say? Or are they just positioning themselves at the very bottom of the sales funnel and taking credit for harvesting the existing demand and brand preferences that were established elsewhere through a variety of other marketing channels?
But first things first. What is “attribution?” Very simply, attribution means or denotes who gets credit for the final conversion. Sounds simple, right? Well, not really. Here’s why. Let me give you a very basic analogy. Let’s say you work at a corporate office and your company’s CEO tasks your department to prepare a report detailing how to improve the overall production process. At this point, you would use all of your available resources and enlist your department’s team to work on it. One person may be doing research about getting better equipment to decrease production time, another person may be contacting vendors to negotiate faster turn-around times, you may be looking at ways to minimize work interruptions or avoid unnecessary meetings, etc. Four weeks go by and the report is finally ready. You hand it to your CEO and she loves it! You walk away feeling like a champ and she writes an inter-office memo giving you credit for it. Why? because you were the LAST person in the process (last click) and the person that effectively completed the task for your boss. In other words, the attribution for the “conversion” or in this case, the success of the report goes to you. But what about the rest of your team and researchers that contributed to the creation of the report?
In the advertising world, everyone wants to take credit for every (good) outcome and that’s why you need to have a clear understanding of how the entire process works. While Attribution is critical because it allows marketers to measure results and evaluate what ads or marketing channels provide better ROI, it can also lead to a lot of confusion and misleading numbers. Consider the fact that AdRoll’s “State of Performance Marketing Report” found that almost 75% of marketers believe attribution is critical or very important to marketing success. Over 40% said that they spend the lion’s share of their yearly budgets on campaign measurement.
IT’S ALL ABOUT THE AD CLICK – OR NOT.
Ad clicks do matter. A lot of advertising KPI’s are based on ad clicks: cost-per-click, cost-per-conversion, click-through-rate, just to name a few. However, if you’re tracking ad clicks alone, you’re also missing a large portion of your audience; those who don’t click on ads, but may still be influenced to convert later.
There are several reasons to include ‘non-clicks’ as part of your campaign metrics.
- According to Ad Roll, “A small portion of people click on ads: Only 16% of users click on ads, and half of those, 8% account for 85% of all clicks on display ads. This means that this pool of what the industry calls “natural born clickers” is the only audience you track.”
- Last-click attribution models are fundamentally incentivized to find users already likely to purchase-a practice referred to as “funnel jumping.” Ideally, advertising should influence users to consider purchasing a product or service they wouldn’t otherwise have been exposed to. In other words, attracting customers from the top of the funnel (awareness stage) to the bottom of the funnel (action or purchase stage).
- Credit is not accurately assigned across all of your marketing channels; last-click gives all the credit to the final click and ignores any other marketing that occurred before the purchase. This means any previous messaging users were exposed to, in addition to any content they consumed that discussed your brand, isn’t appropriately valued.
All of the above points lead us to the question about View Through Conversions (VTC). VTC data tells you when customers see, but don’t interact, with your ad, and then later complete a conversion (more on this below) on your site. This is different from any of the click-related data that records conversions when customers interact with an ad and then complete a conversion on your site.
The challenge is that different advertising channels also measure VTC differently. For Google’s Display Network ads, the last viewable impression will get credit (attribution) for the view-through conversion. According to Google’s Active View technology, an impression of a display ad is considered viewable when at least 50% of the ad is onscreen for at least 1 second. Google’s VTC automatically exclude conversions from people who have also interacted with any of your other ads. Google AdWords console also separates “View-through conversions” and regular click-through “Conversions” into separate columns.
Since a VTC is based on a customer conversion that happens “later” on your website, the other key factor is how much later is “later.” Google announced that starting March 29th, 2017, they are updating the default window for view-through conversions from 30 days to 1 day. This means only conversions that happen within one day of an ad impression will be reported as VTCs by default. Other advertisers such as Sojern, claim to use a default one-week look-back window to take credit for a view-through-conversion.
If you’re still with me, you may be wondering what happens when ads served by different platforms overlap or more basically who gets the attribution in those cases. This is the equivalent of driving down the freeway and seeing a Clear Channel managed billboard promoting a hotel offer, and the same offer being advertised a few miles down the road by a similar CBS Outdoor managed billboard. If you later -when you get to your destination- decide to “book” the advertised offer, who would you give credit for the view-through-conversion, Clear Channel or CBS Outdoor? What if instead of two outdoor billboards, you just see two different banners on separate websites without clicking them. And what if you just go to Google, search for the hotel that you saw on the billboard or the banners and then booked your stay? Does Google Search get the last-click attribution ignoring altogether the view-through-conversion?
As you can see, neither last-click attribution or view-through-conversion attribution tell the whole story. But at the same time, both serve critical stages of your advertising strategy. Rather than competing with each other, you should think of them as complementing each other. That’s why it is very important to target the message of your ads to the proper audience, from the top of the funnel (awareness) to the bottom of the funnel (action).
If you have any questions about how to optimize your digital marketing campaigns, please contact our team at MGR Consulting Group. Until next time, this is Manuel Gil del Real (MGR).
Sources: AdRoll, Sojern, AdWords,
Photo Credit: WeWork