Marketing is expensive, and marketing insights are as crucial for your business as accounting insights. It is of utmost importance that you understand what’s working and what isn’t to make the best use of your resources–this is where data-driven attribution comes in.
In this article, we’ll discuss what data-driven attribution is, its advantages, and who should use it.
What Is Data-Driven Attribution?
Data-driven attribution is a marketing measurement technique that uses data from multiple channels to attribute conversion events to the channels that drove them. In simple terms, it allows you to see which marketing activities are driving conversions and how each channel contributes to the customer’s journey.
For example, let’s say a customer sees an ad on Facebook, clicks on it, and visits your website, but doesn’t buy anything right away. A few days later, they see another ad on Instagram and click on it. This time, they do end up buying something from your website. In this scenario, data-driven attribution would attribute the conversion to both the Facebook and Instagram ads, because they both played a role in driving the sale.
What Are the Advantages of Data-Driven Attribution?
There are many advantages of using data-driven attribution over other methods like last-click attribution.
1. You Can See the Full Journey
Data-driven attribution allows you to see the full customer journey, from initial awareness all the way to conversion. This is a valuable insight that can help you understand what’s working and what isn’t, so you can optimize your sales funnel for conversion.
2. You Can Attribute Value to Each Channel
Data-driven attribution allows you to attribute a value to each marketing channel based on its contribution to the conversion. This is valuable information that can help you allocate your resources more effectively.
3. You Can Identify Which Channels Are Most Effective
Lastly, data-driven attribution can help you identify which channels are the most effective at driving conversions. Not only will this allow you to allocate more resources to the right marketing channels, but it will also help you optimize those channels for even higher conversion rates.
Who Should Use Data-Driven Attribution?
Data-driven attribution is an important tool for any business that wants to understand how its marketing activities are driving conversions. If you’re looking for a way to get more insight into your marketing strategy and make better decisions about where to allocate your resources, data-driven attribution is a great option. This is especially true for businesses with a multi-channel marketing strategy. Data-driven attribution can help you understand how each channel contributes to the customer’s journey so you can make better decisions about where to focus your efforts.
Data-driven attribution is also beneficial for businesses where buyers have complex buying journeys. For example, data suggests people make thirty-seven searches on average before making a travel-related purchase–this increases to 139 searches for car-related purchases.
On the other hand, data attribution might not be a great option for businesses with simple marketing strategies or for businesses in which the buyer takes a short and simple buying journey. For example, if you’re a local plumbing business with a small marketing budget and most of your customers come from word-of-mouth, data attribution might not be worth your time and resources. Similarly, if you’re an emergency business—such as a vet’s office—where customers usually come to you in a time of need and don’t have time to comparison shop, data attribution might not be necessary. In these cases, last-click attribution might be a better option because it’s a simpler way to attribute conversions.
Data-driven attribution is a powerful tool that can help you understand your marketing strategy and allow you to better allocate your resources. If you’re looking for a way to get more insight into your marketing efforts, data-driven attribution is a great option. If you’re interested in growing your business through the power of data, check out our recent posts on what data-driven insights are and what to include in a business report.