Exploring the 5 Marketing Attribution Models for Revenue Growth
Marketing attribution models provide valuable insights into the effectiveness of your marketing efforts, helping businesses understand which touchpoints contribute most to revenue growth. These models offer different approaches to attributing credit to various marketing channels and campaigns. By exploring the five marketing attribution models, businesses can choose which model works best to gain a comprehensive understanding of their buyers' journey and optimize their strategies to drive revenue growth. In this blog post, we will delve into the top five models and their impact on business success.
Understand these models and compare each to your company’s style for demand generation and from there you can begin to measure your marketing touch efficacy.
First-Touch Attribution Model:
The first-touch attribution model assigns all credit for a conversion or sale to the initial touchpoint that brings a customer to your brand. This model highlights the channels and campaigns that successfully attract new customers. By analyzing first-touch interactions, businesses can refine their marketing strategies and allocate resources to their top-converting efforts, resulting in improved customer acquisition and revenue growth.
This model is limited, but can be especially effective for B2B orgs, those with very fast sales cycles, or for teams that do no sales outbound.
Last-Touch Attribution Model:
The last-touch attribution model attributes all credit for a conversion or sale to the final touchpoint that directly leads to the customer making a purchase. It focuses on the last interaction before the conversion. This model is valuable for understanding the effectiveness of direct response campaigns, such as email newsletters, retargeting ads, or personalized offers.
Optimizing last-touch interactions can drive buyers towards the final purchase, leading to increased revenue and higher conversion rates.
This model is also a limited one, but can be effective for companies who have a smooth marketing-to-sales handoff and a short sales cycle. Knowing what campaigns touched right before purchase leads you to invest in your higher performing touches.
Time Decay Attribution Model:
The time decay attribution model acknowledges that the impact of touchpoints diminishes over time. It assigns more credit to touchpoints that are closer to the conversion and less credit to earlier interactions. By understanding the diminishing influence of touchpoints, businesses can adjust their marketing strategies accordingly, focusing more on touchpoints closer to the conversion to maximize revenue potential and shorten the sales cycle.
This model is particularly valuable for businesses with longer sales cycles or complex customer journeys. It also requires advanced attribution technologies and a large database size to process the data, especially if your sales cycles are slow.
Multi-Touch Attribution Model:
The multi-touch attribution model considers multiple milestones along the customer journey and assigns credit to specific interaction that influences the conversion. Usually this is broken into three types: U-Shape, W-Shape, or Full-Path. This comprehensive approach provides businesses with a more holistic view of their customers' engagement with marketing efforts.
U-Shape gives equal credit to the First Touch and Lead Create touches only.
w-Shape gives equal credit each to First Touch, Lead Create, and Opportunity Create.
Full-Path gives equal credit to First Touch, Lead Create, Opportunity Create, and Sale.
By identifying the most credited touchpoints, businesses can optimize their marketing mix, allocate resources effectively, and enhance the overall customer experience, ultimately driving revenue growth.
This model is great for companies with many marketing channels and lots of demand generation methods, and lets them identify which assets and channels produce the most interactions before a sale. The downside is that all interactions are weighted equal and takes some time to weed through results. It also requires advanced attribution technologies and a large database size to process the data, especially if your sales cycles are slow.
Custom Attribution Model:
The custom attribution model assigns different weights to touchpoints based on their perceived impact on the conversion. This model allows businesses to customize the attribution model according to their specific goals and priorities. By assigning higher weights to touchpoints that have a greater impact on revenue generation, businesses can better understand the channels and campaigns that truly drive growth. This information empowers businesses to make data-driven decisions, optimize marketing efforts, and allocate resources effectively, resulting in revenue maximization.
This model is great for companies with many marketing channels. It also works great to assign value to multiple conversion points during the sales cycle. It also requires advanced attribution technologies and a large database size to process the data, especially if your sales cycles are slow.
Choosing the right model and platform
By exploring these models and choosing one to apply to your unique customer journey, you can make informed decisions, optimize marketing mix, and allocate resources effectively. Embracing the correct marketing attribution model will pave the way for revenue growth and long-term success.
The last 3 models also usually require the installation of an Attribution platform that plugs into your marketing channels to analyze them for you. These tools can be expensive or take time to configure. Examples include HubSpot Marketing Hub Professional or Enterprise, Adobe Marketo Measure (formerly known as Bizible), or other tools.
