Learn More About Attribution Software
What is Attribution Software?
Attribution software, or marketing attribution software, is used to determine the marketing tactics that are contributing to sales or conversions. Marketing teams use a variety of software and marketing tools to funnel prospects from product awareness all the way down to purchase. During this customer journey, prospects go through various channels or touchpoints; there is usually a point where a prospect goes from being interested to becoming a committed buyer. Attribution platforms allow marketers to determine which touchpoint or channel was most effective in convincing that prospect to become a committed buyer and finally make a purchase.
There are various attribution models that marketers use to determine which touchpoints are the most effective for their business, such as first-touch, last-touch, and multi-touch attribution. To choose a model, it is important for a business to evaluate their sales cycle and determine how much of it is done online and offline. For example, most e-commerce sites rely heavily on touchpoints such as display advertising and native advertising. Conversely, a local service such as an auto mechanic may prefer traditional methods like newspaper advertising. Ultimately, most organizations may utilize several attribution models to evaluate which marketing campaigns are the most effective. The best way to begin using attribution software is by mapping out a typical customer journey and identifying which channels and touchpoints are the most important for the particular business model.
Lastly, it’s important to note that attribution software should not be mistaken for mobile attribution software. Rather than focusing on which touchpoints convert a prospect into a buyer, mobile attribution software focuses specifically on the techniques that drove each user to install a mobile application. Mobile attribution provides insight into where each mobile application install came from across every marketing channel, device, and advertising network.
What Types of Attribution Software Exist?
Since there are so many different touchpoints and channels that a buyer sifts through during the sales funnel, there are various types of attribution software to help determine the channel that influenced a purchase the most. Listed below are some of the types of attribution software:
Multi-touch attribution
Multi-touch attribution helps determine which touchpoint is the most responsible for a final sale. Rather than testing major sales channels, multi-touch attribution focuses on granular touchpoints such as marketing messages and native ads. For example, if a customer is searching for new phones on the internet, they may soon see ads from various phone companies. If a customer sees an ad for a phone they like and immediately proceeds to the company website, then marketers can accurately determine that particular ad is what influenced that buyer to come to the website. Multi-touch attribution is beneficial because it offers specific granular data for marketers rather than broad assumptions on what contributed to a sale.
Additionally, there are two major types of multi-touch attribution: first-touch attribution and last-touch attribution. First-touch attribution gives credit to the first marketing touchpoint as the most influential touchpoint that contributed to a sale. For example, if a customer’s first interaction with a company is by clicking on a display advertisement, then the display advertisement would be considered the most important touchpoint in a first-touch attribution model. Even if the customer went through various other touchpoints after clicking on the display advertisement, it wouldn’t matter in this model because the first touchpoint is considered the most important. Last-touch attribution is the complete opposite, where the last touchpoint is considered the most important. Let’s say a customer clicked on the display advertisement and then proceeded to a video advertisement before making the final purchase. In a last-touch attribution model, the video advertisement would be considered the most important touchpoint since this is the last touchpoint before the purchase.
There are other models of multi-touch attribution that consider all touchpoints equally important or weigh each touchpoint differently. The key takeaway is that attribution software allows marketers to choose from many different models to measure touchpoints and their importance. Marketers can play around with various models and choose the ones they consider most effective in their strategy.
Marketing mix modeling
Marketing mix modeling is a more complex type of attribution because it takes into account a variety of factors that contribute to a sale. The four major factors that marketing mix modeling focuses on include product, price, place, and promotion. Marketing mix modeling tries to find the optimal balance across these four marketing efforts to determine the weight of importance that should be given to each. This offers insight into which marketing channels are working and which ones are not.
What are the Common Features of Attribution Software?
From custom attribution modeling to conversion summary reports, attribution software provides all the necessary tools to track how buyers funneled through the customer journey and converted into a purchase.
Attribution modeling: Attribution modeling allows users to select from a variety of attribution models. Whether it’s single-touch or multi-touch attribution, users can select from a variety of attribution models that place varying importance on marketing touchpoints across the customer journey.
Cross-channel attribution: It’s important that marketers are able to use attribution software to connect campaigns across channels and fully understand a customer’s journey. Cross-channel attribution means that marketers can follow prospects and understand the different steps they take across the entire customer journey.
Offline attribution: Offline attribution allows users to track touchpoints through offline channels such as traditional ads, marketing events, or in-store promotions.
Dashboards: Marketing dashboards consolidate all data on touchpoints and marketing channel performance. This allows users to view and manage this data to evaluate which campaigns are working better than the others.
Promotion analysis: Promotion analysis tools allow users to measure the performance of sales and promotions. By evaluating how often users click on ads that display promotions or sales, users can evaluate the effectiveness of price cuts.
Integrations: It’s important for attribution software to integrate with different tools and systems, like CRM software and marketing automation software, to ensure that all marketing data is being utilized across the entire marketing strategy.
What are the Benefits of Attribution Software?
Spend optimization: Attribution platforms allows businesses to optimize spend across all marketing efforts. For example, marketers can use attribution software to pull cost data from all major ad platforms, correlate those costs to specific accounts, and then track revenue from touchpoints over time.
Personalized content: Marketers can utilize attribution software to present more effective personalized content to potential buyers. This software provides companies with visibility on how digital assets impact sales opportunities and revenue, which enables marketers to automatically optimize user journeys with personalized, revenue-driven recommendations.
Improved product development: This type of software enables businesses to improve product development through attribution data analysis. Contact-level attribution offers a unique insight into the needs and wants of customers, and this data can be referenced during product updates so teams can focus on the features and functionalities that matter most.
Revenue tracking: Attribution software allows marketers to accurately determine if sales and promotions are effective drivers of revenue. This type of software enables marketers to track, connect, and credit marketing efforts to their downstream revenue generation.
Who Uses Attribution Software?
Attribution platforms are used across a wide variety of industries. From business to business software providers, as well as service industries, every business must evaluate the performance of their marketing efforts. With this in mind, attribution software is usually found within the marketing departments of these businesses. Below are some of the most common industries that take advantage of attribution software:
E-commerce: Any business that sells goods online can greatly benefit from using attribution software. E-commerce businesses generally funnel their consumers through many touchpoints and marketing channels, which makes it difficult to determine which ones contributed the most to a final sale. From native ads to video advertising, attribution software helps e-commerce businesses ascertain which channels are the most effective.
Retailers: While e-commerce businesses only have to focus on online conversions, retailers must focus on both online and offline conversions. Although it might be more difficult to track, retailers that log sales in store can gather customer information such as emails to target their marketing efforts on that particular customer. This can help track if promotional emails lead to customer conversions in stores.
Software Related to Attribution Software
Related solutions that can be used together with attribution software include:
CRM software: A CRM is usually one of the core products in a businesses’ software stack that helps them track and manage customer interactions in a single system of record. It houses all relevant customer data including contact information, history, and transaction summaries. It makes sense for users to integrate attribution software alongside CRM software to monitor how a certain deal closes in the sales funnel. Once that is recorded, users can also use customer information to reiterate back into the attribution process. This facilitates the use of customer information to understand products they like and send out personalized messages and offers. The two can work in tandem to complete sales on a more regular basis.
E-commerce platforms: It can be very beneficial to integrate attribution software with e-commerce platforms to more accurately track sales conversions. Every time a purchase is made online, users can then analyze if the product sales was due to a particular ad or any other marketing touchpoint.
Marketing automation software: Marketing automation software automates marketing actions or tasks, streamlines marketing workflows, and measures the outcomes of marketing campaigns. Since attribution software also focuses on measuring the outcome of marketing campaigns, it makes sense to integrate both marketing automation software and attribution software.
Challenges with Attribution Software
A lot of the issues that arise out of attribution software are due to incorrect attribution. This can be caused by biases in data or other factors. Here are some of the most common pitfalls to look out for.
Correlation-based biases: Correlation-based biases occur when marketers believe that certain marketing efforts caused a chain of events when they did not. For example, if attribution software picks up on clicking a display advertisement as being the first touchpoint in the customer journey when it was really a customer going to the physical store, then this can be an incorrect correlation. This may make marketers weigh more importance on display advertising, leading to misguided efforts.
In-market bias: In-market bias refers to customers who would have purchased a product whether or not they clicked on an advertisement in the first place. Once again, this can cause marketers to increase spend on display advertising because this is what they think caused the customer to make a purchase.
Integrations: There is an abundance of marketing touchpoints, or any interaction between the company and a potential buyer, that customers experience. These touchpoints could be any activity, from viewing marketing content mentioned on social media or attending a company’s virtual event or webinar. As the number of marketing touchpoints increases, it is even more imperative that all of a company’s marketing technology stack integrates with attribution software correctly so marketers can measure the impact of all these touchpoints.
Which Companies Should Buy Attribution Software?
Any company that invests in marketing efforts could benefit from purchasing attribution software. Attribution software assists businesses in determining the most appropriate channel to focus their marketing efforts on and the best time to reach buyers. Businesses don’t want to spend money on a particular marketing campaign or channel that isn’t driving results; attribution software helps solve that problem.
E-commerce: When a business sells products online, it is important to effectively market those products using various channels. Attribution marketing is imperative for e-commerce businesses to track their marketing campaign’s performance across various channels as many e-commerce brands have a multichannel digital marketing strategy.
How to Buy Attribution Software
Selection of Attribution Software
When a company is ready to start evaluating different attribution tools, there are a few aspects that are important to consider.
Security: It’s important to choose an attribution software that is secure and will safely house customer data. Due to an increasing number of data privacy regulations, like the GDPR and CCPA, it is imperative that attribution software has exceptional security features.
Integrations: Ease and breadth of integrations is also an important factor to consider when choosing an attribution tool. There is an abundance of sources that attribution software pulls in data from, and that is contingent on having exceptional integrations with other types of software (i.e., CRM, marketing automation, email marketing, digital advertising, SEO, etc.).
Attribution sources: Varying attribution software specialize in certain types of attribution, so companies should evaluate which type of marketing activities they want to track and measure. Some attribution tools specialize in tracking offline marketing activities, mobile-only marketing activities, social media advertising activities, etc. When evaluating for which attribution tool is best for the organization, buyers must consider if they need a specialized or a general tool.
What Does Attribution Software Cost?
The cost for attribution software varies depending on multiple factors, including the amount of channels it supports, the breadth and ease of APIs and integrations, the robustness of reporting and drill-down capabilities, support hours, and the ability to set up custom attribution models.
Return on Investment (ROI)
While some attribution tools will include offline marketing activity channels, other attribution tools may charge extra to set up offline marketing attribution. Additionally, attribution tools that support multichannel methods may cost more as they enable marketers to see the ROI across all marketing channels, which can ensure marketing budgets are being allocated effectively. To measure the ROI of the attribution tool of choice, buyers should look at the drill down of every click, conversion, and budget allocation for all marketing campaigns and determine how these campaigns are performing against how much revenue is coming into the company.
Implementation of Attribution Software
How is Attribution Software Implemented?
There are multiple steps marketers should take before implementing attribution software. First, it’s important for marketers to evaluate what questions they want their attribution tool to answer. For example, if the director of customer success is involved in this decision process, it might be important to see if the attribution tool can measure the impact of marketing campaigns on customer renewals.
Then, during implementation, marketers should be ready to connect their other marketing technology. Marketers should think about all the tools that make these touchpoints possible so all the tools are communicating with each other. IT teams may need to help out when connecting various systems with the attribution tool that is selected. Finally, when implementing attribution software, marketers should keep in mind that it takes time to implement the attribution model that works best for a company. It will take time to understand and test which model is performing well against company goals.
Attribution Software Trends
Account-based marketing attribution
Some attribution tools specialize in account-based marketing attribution, which surfaces each touchpoint for each lead and contact under specific accounts. These tools help marketers better understand engagement with multiple contacts associated within an account or buying group, as well as gain complete visibility into touchpoints across contacts and leads within a matched account. Attribution tools with the specialization can also tie how much revenue each engagement within an account is worth and measure the progress of a customized account journey.
Offline tracking
Offline tracking, in combination with tracking digital channels, is becoming increasingly important for marketers. Tracking leads, conversions, and engagement from offline channels (i.e., events) alongside channels like digital advertising enables marketers to measure the effectiveness of all marketing touchpoints throughout a customer journey.
