Marketing Attribution Models

What are Marketing Attribution Models and how are they used?

Inextricably linked to marketing attribution are attribution models. Attribution models are basically the formulas used to divide the value the touchpoints brings in the customer journey.

There are many different attribution models, the most important thing to know is that there is no one size fits all. Each organization should seek to discover wich attribution model fits best to their business and customers. This could even vary in different time periods, for example when running a sale campaign.

In this article we’ve explained the six most common attribution models, and two of our own created attribution models at Odyssey Attribution.

A short definition of attribution models

Marketing attribution is increasingly important for any endeavor in digital marketing, as the volume of e-commerce transactions steadily increases and thus the importance of digital channels rises dramatically.

At Odyssey, we define Marketing Attribution as the following:

“Marketing Attribution is the process of analyzing your data in order to give credit to the touchpoints in a customer journey, enabling you to identify the incremental performance of every traffic source based on its role in the customer journey. This analysis should result in actionable insights that help you to spend your marketing budget as efficiently as possible.”

Attribution Models are calculations used to determine the value that should be attributed to different channels. A distinction can be made between single-touch attribution models and multi-touch attribution models. Examples of attribution models are first click linear, last click, last non-direct click, etc.

There are several different attribution models that each can be used for different purposes. Below you can find a selection of the most common attribution models that are broadly applicable in marketing attribution analysis.

Single touch attribution models

On the highest level we can make a distinguishment between single-touch and multi-touch attribution models. Single-touch attribution models only credits one touchpoint in the journey, whereas multi-touch attribution credits multiple touchpoints in the customer journey. Below you can find an image of some of the most used attribution models.

Last Click

The Last Click attribution model is the most commonly used attribution model in digital advertising. The model does as the name implies and gives 100% of the credit to the last touchpoint your organization had before the customer purchased.

First Click

A First Click linear model is the opposite of the Last Click attribution model. With the First Click attribution model, 100% of the credit is given to the first touchpoint in the customer journey.

Last Non-Direct Click

The Last-Non-Direct Click attribution model is a little bit more complicated. It’s still a single-touch attribution model, meaning that 100% of the credit is being given to a single touchpoint. However, if in this attribution model the last touchpoint is ‘direct’, 100% of the credit is being given to the touchpoint prior to that touchpoint. The Last Non-Direct Click attribution model is the standard attribution model in Google Analytics.

Multi-touch attribution models

Linear

In the Linear attribution model all the credit for the transaction is being split eventually over the different clicks in the customer journey. Every click get’s the same amount of credit, regardless of the position of the click.

Time Decay

In a Time Decay attribution model all the clicks are being credited, but the amount to which the click is rewarded depends on the position of the click. As the click is closing towards the transactions, the click will receive more credit.

U-Shaped (Position Based)

The U-Shaped attribution model (which is being called Position Based by Google Analytics) gives most of the credit to the first and the last touchpoint, and then divides the rest of the credits over the other touchpoints in between. The first and the last touchpoint, each receive 40% o the credit. The remaining 20% of credit is being split between the touchpoints in the middle.

First Click Linear

The First Click Linear attribution model is created by Odyssey Attribution and gives most of the credit to the first touchpoint and then linearly decreases the amount of value as the touchpoint is further away from the first touchpoint.

Last Click Linear

Similar to the First Click Linear model, the Last Click Linear attribution model is also created by Odyssey Attribution. The Last Click Linear attribution model is the exact opposite of the First Click Linear model. Most of the credit is being rewarded to the last touchpoint, the credit is then linearly being decreased as the touchpoints are further away from the last touchpoint.

Which attribution model is the right one for me?

With the variety of models possible in Marketing Attribution, it might look difficult to determine which one is the right fit for your company. In general, choosing the right model depends on the specifics of your business.

This is not necessarily one optimal attribution model, you simply need to choose it based on your business and the market it operates in. So first, the choice of the attribution model needs to be in line with your business goals, key traffic sources and strategy. When applying attribution analysis, think about how you drive your business, what your strategies are and how the perfect customer journey looks like.

As an example, if you want to primarily get initiating clicks (i.e. the first click in a purchasing path) it is worthwhile using a model that credits the initiating touchpoints of the customer journey. If you value the converting touchpoints of your ideal journeys more, then it is more sensible to choose a model crediting the last (or later) clicks.

In any case, it is very important to consider that customer journeys work together in synergy and thus every touchpoint enjoys a certain importance. If you want to credit this, you may want to consider choosing a model based on multi-touch attribution. We have explained what multi touch attribution is [here]. The basic concept of these is, like explained in the models before, to divide value to each touchpoint of the path - thus crediting each with a value that can help analyzing the importance of certain touchpoints in your journey.

Because every company and its business models differ, it is possible that you may have to alternate with your models and see which ones fit the best. This is very sensible as it allows you to view your data and insights from different angles.

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In case you want to find out more about digital marketing or attribution, make sure to check out our blog or our other academy posts. You can also schedule a demo and start experiencing it for yourself!