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What Is an Attribution Model?

Businesses reach their customers in a multitude of ways. Some reach them through social media, others reach them through digital ads. But if you want your marketing efforts to be successful, you need to reach your customers through various marketing channels.

But once you've created these various marketing channels, you need a way to track their success, which you can do with an attribution model. But what is an attribution model and why is it so important?

An attribution model is a way to determine the value of your marketing channels. It's crucial to know which marketing channel has the most impact on the customer journey, and using an attribution model can help you figure out exactly that.

In this article, we'll discuss why attribution modeling is valuable, the common types of attribution models, and more. Continue reading to find out more about how attribution models can improve the customer journey for your business.

Attribution modeling explained

Attribution modeling is a method of assigning credits to the marketing channels and touchpoints that lead to a conversion.

The goal behind attribution modeling is to carefully track and analyze how each marketing channel is performing so that you can identify which ones are the most effective at driving conversions.

With attribution modeling, you assign credits to each of your marketing channels, which can help increase conversions by allowing you to identify aspects of the buyer's journey that you can improve.

Attribution modeling is used to evaluate the impact of various advertising efforts—attribution models assign a proportional value to each touchpoint along a customer's journey, leading up to a successful conversion or sale.

Why is attribution modeling valuable?

In order for your marketing campaigns to be successful, you need to track and analyze their performances, which you can do with attribution modeling.

With attribution modeling, you can hone in on different aspects of the buyer's journey to understand what parts are performing well and what needs improvement. Some of the reasons why attribution modeling is valuable includes:

Improve aspects of the buyer's journey

Understanding your buyer's journey is crucial so that you know what leads a customer to make a purchase.

Fortunately, attribution modeling can give you more insight into marketing analytics and how your channels are performing so that you can make necessary improvements and direct traffic to your business.

Spend your money more wisely

It's crucial to spend your money wisely, especially when it comes to marketing, which attribution modeling can help with. Attribution modeling can help you determine the best ways to spend your budget so you're not wasting money on channels that aren't making any conversions.

Create the best marketing campaigns

Attribution modeling can help to improve your marketing strategy in more ways than one. Since attribution modeling allows you to identify the best-performing channels, you can create better marketing campaigns that are tailored made for your target audience.

Determine the ROI for your channels

ROI measures the return on investment of every marketing channel you use. Attribution modeling can help to determine the ROI for each of your channels so that you can improve your marketing strategies for the future and make better business decisions.

Common types of attribution modeling

So now that we've answered "what is an attribution model in marketing?", let's go over the different attribution models.

Types of attribution modeling

There are five main types of attribution modeling that you'll see advertisers use, so it's important to choose the right one for your business's goals.

Last-touch attribution modeling

A last interaction model is a type of attribution modeling that gives full credit to the last touchpoint a lead had with a campaign.

For example, say someone interacted with your website, signed up for your email newsletter in exchange for a discount, and eventually responded to an email campaign before converting.

In this case, 100% of the credit would go to the email campaign because that was the last touchpoint before the customer converted.

Last-touch attribution modeling is best for businesses with short buying cycles because it's easy to implement and understand. With last-touch attribution modeling, you can quickly identify the exact touchpoint that leads to customer conversion.

First-touch attribution modeling

A first-interaction attribution model is the complete opposite of a last-interaction model because all the credit for the conversion goes to the first touchpoint.

For example, in the case above, full credit would go to the website because that is where the customer journey started. First-touch attribution modeling is best for businesses with a short buying cycle because you need to focus on that initial interaction someone has with your business.

Linear attribution modeling

A linear attribution model disperses equal credit across all the channels and touchpoints a customer interacts with. So in the case above, equal credit would go to the website, newsletter, and email campaign.

Linear attribution modeling is an easy way to identify the ROI of each channel because it doesn't take into consideration complex metrics or analytics.

Time-decay attribution modeling

The time-decay attribution model gives credit to all the touchpoints and channels, but it also takes into consideration how long a person spent at each point. This can help advertisers determine which channels are most effective and which could use improvement.

The touchpoints that occurred closest to the point of conversion have the most value. This type of attribution model is best for longer sales cycles to determine which channels your customers spend the most time on.

Position-based attribution modeling

Position-based attribution model, also known as a U-shaped attribution model, distributes credit between the first and last touchpoints.

In most cases, 40% of the credit is given to the first touchpoint, 40% is given to the last, and 20% is spread out across all the touchpoints that happened in between.

A position-based attribution model is best for businesses with several touch points before a conversion. This allows you to see each touchpoint individually so you can identify which are performing the best.

Attribution models assist companies in understanding graphic

What is the best type of attribution modeling?

The right attribution model ultimately depends on your business and what you're looking to achieve with your marketing campaigns.

There isn't necessarily a "best" type of attribution modeling as they can all provide valuable insights into which channels are performing the best. Before deciding on an attribution model to use, figure out what type of information you're most interested in learning.

To determine the right type of attribution model for your business, you'll want to ask yourself questions like "how many stages are there in the marketing funnel?" and "what are my customer's goals?".

If you have an idea of the customer journey and what your customers are looking for with your brand, you can make a more informed decision about which type of attribution model is best for your business.

Can you use multiple attribution models at once?

Yes, you can absolutely use multiple attribution models at once, and in some cases, it may even be more beneficial to do so.

By using multiple attribution models at once, you can gain more valuable insight into the sales cycle and how much your different channels impact your sales. Using multiple attribution models allows you to see the full picture so you can better measure the success of your advertising campaigns.

It can also help tailor your customer experience because you can see which specific channels influence your customer's decisions, rather than putting all the focus on one channel or touchpoint.

Use attribution modeling to refine your marketing efforts

If you want to gain insight into which of your channels are performing the best with your customers and direct traffic to your business, you need to use attribution modeling.

Attribution modeling can help you better understand your customer's journey so you can make more informed decisions about your marketing efforts. For example, if most of your conversions happen through social media marketing and digital ads, you should focus more on those to ensure they are the best they can be.

With attribution modeling, you can improve your marketing strategies and create the best marketing campaigns that drive revenue and increase sales for your business. But if you need help with developing these marketing campaigns or understanding your customer's journey, use Mailchimp.

Mailchimp is an all-in-one email marketing platform that can help with everything from designing campaigns to tracking and analyzing them.

With Mailchimp, you can gain valuable insights into your target audience and how well your campaigns are performing so you can make better decisions for your business. Mailchimp also has a customer journey builder, which you can use to automate your marketing and deliver better results. Use Mailchimp to optimize your marketing strategies so you can increase conversions and reach your business goals.

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