A really simple method for solving the attribution dilemma
If you take a step back and take in the swirling chaos that is the current marketing communications universe two things become clear. First, 2017 is going to be the mother of all years for media mix decisions. Google has locked in its position, Facebook wants to grow more, all the other digital players fight for crumbs, TV is not ready to cede dominance to digital, news media refuses to step back any more and OOH is newly revitalised from its digital capabilities. All of this comes to a head in 2017.
Second, brands and the people in charge of them are going to find themselves in the middle of this marketing maelstrom next year. Faced with the same budgets but with more options competing all the more vehemently for your money, marketers have never needed to know what communications options work and don’t work for their brand more keenly than right now.
We call this mission to assess the value of various touch points and channels attribution. It’s always been a key topic for marketers, but the battle for budget means it will rise to the very top of the tree next year. How does a marketer assess which channels and tools and agencies that make up their campaign are delivering? It’s certainly an essential question to address, but attribution methods have been badly contorted in recent years as the usual nonsense and biases take hold.
For starters, beware the digital-only model of attribution. Thanks to the more advanced nature of targeting and the ability to monitor and interact with customers through digital channels, it’s tempting to simply monitor the various digital channels you are using and attribute ROI exclusively to these channels. That’s somewhat akin to declaring the Olympic 100-metre champion to be the fastest man from lanes one through to four, even though the athletes in lanes six and eight ran more quickly than anyone else. The whole point of attribution is being able to compare all the touch points you are using, not just the ones that make comparisons relatively simple.
It’s crucial therefore to be able to look at all the respective channels in your mix and compare across them during attribution. Again, however, that can prove problematic. Many marketers simply look at ROI from the perspective of which media channels deliver the most sales for their brand. At first sight that makes perfect commercial sense – if it’s not about sales what is the point?
Well, it is about sales, but before you can make a sale you have to have preference. Prior to preference you need awareness – and so on.
Seen this way, it’s clear that while converting prospective customers into actual customers is a crucial step, so is making them prospective in the first place. But if attribution is myopically focused on which tool will deliver sales, we inevitably end up favouring the touch points at the end of the funnel, rather than those that bring customers into the top or send them through.
This so called ‘last click’ or ‘last touch’ approach to attribution is pernicious. I could list three very big clients of mine right now that have all, independently, realised that they have been overly focused on the bottom of the funnel and suddenly – as the conversion rates have started to drop down there – have realised that they have neglected the earlier steps in the purchase path.
What is needed is therefore a cross-media, cross-funnel model of attribution that genuinely enables a marketer to see how all respective media interact and impact on the target market. But once again we run into a problem. There are companies and tools out there that can do this. They use a combination of very complex analytics and usually a regression-based model to assess the impact of each and every tool you use.
At this point I am going to sound like a Luddite, but I have to confess that in all the years I have seen this process in practical application – ie. not in an academic setting or just in an isolated hypothetical case – the end result is never practically applicable to making marketing decisions. Too many moving parts – segments, competitors, retailers, changes in brand equity, even weather – conspire to make proper attribution all but impossible.
So we will need attribution more than ever in 2017 and yet the process of doing it right is all but impossible. What should a decent marketer do? Well, I have a solution, but you may not like it.
First, build a proper sales funnel. Ignore those people telling you the funnel is dead, it’s never been more useful. But make sure your funnel is a custom one based on your customers in your market buying your brand – not some generic textbook thing.
Next, populate your funnel with the proportion of customers that make it to each stage using a big dollop of quantitative market research.
Third, look at the conversion ratios from stage to stage and work out which stages in the funnel will be your focus for 2017. Brief your agencies and set some hairy goals for what you want to achieve. Select the agencies and proposals that appear best placed to deliver on your objectives with the best return and execution.
When it comes to attribution you are now in a magical place. You have a series of clear objectives and a number of agencies signed up to help you achieve them. Let the campaign begin. At the end of the period repeat your quant market research and see if the populations have moved in the right directions. If you said you wanted to increase consideration from 12% to 25% and you are now standing at 28%, it’s time to pay your agencies a bonus and enjoy the moment.
Of course, this is not actually attribution. What if you had three tools – PR, digital ads and OOH – all focused on this objective. What influenced it the most? What offered the best ROI?
Well, this is the bit you may not like. I’d recommend ending your assessment of marketing success at the objective level. If you achieved your strategic objectives assume all three played their part and pay out accordingly. You may want to tweak the effort in the year ahead based on your overall assessment, but don’t sweat the small stuff. Treat all tools like champions.
I know this sounds like an attribution-free approach to attribution, but trust me it does the job and will serve you in the tricky times ahead in 2017.