How to calculate your Marketing Attribution success

1. How to calculate your Marketing Attribution success Long gone are the days of blindly spending marketing dollars without first thinking data to calculate clearly and prove that you are driving a return on your marketing investment (the "ROMI"). This previously linked post shows how to track your ROMI at the 30,000-foot view, based on your overall business revenue vs. cost, or at an average transaction unit level. But, if you really want to fine-tune your efforts to maximize your ROMI, the best marketers will turn to marketing attribution tools to help optimize marketing across every sub-channel of their business. Let me just explain. What Is Marketing Attribution? Marketing attribution is the identification of a set of user actions that contribute to a desired outcome in some way, and then assign a value to each of those events. Let me translate, there are many ways your customers interact with your business. Let's say you're a retailer, and one customer can visit your store, your website, your mobile app, your direct mail catalog, and so on. Marketing attribution tools helps assign value to which (if not all) of those channels should receive credit for sale. So, when you go for that business unit to calculate your ROMI, you match revenues fairly with marketing costs. Calculating Attribution Is Hard The above makes it sound like marketing attribution is a relatively straightforward thing to calculate which can be when the customer visited only one channel clearly. But, what happens when they visit multiple channels simultaneously; that is when the calculation becomes much more difficult. Continue on with our example from above. Let's say a customer gets a catalog in the mail, decides to go to the website for more information and decides to buy the product in the store? Who should be getting the credit now? The answer: they should all receive partial credit, and this is where Data driven marketing tools come in to help calculate that.

2. Who Should Get the Most Credit? The big debate is determining who's getting the most credit for a sale. Should the first touch-point get the most credit, since they most likely started the transaction? Or, should the last touch point get the most credit, since that's where the customer actually pulled out their credit card and bought the product? Clearly the arguments can be made both ways, especially by marketing managers in each of those departments!! To help me determine my ROMI, I tend to bias the first touch point (e.g. the catalog that came in the mail) to help me assess whether or not I should continue to spend money on that particular tactic. Marketing Attribution Tools To help them many businesses turn to sophisticated software packages. Some of the more sophisticated tools are found in Adobe's and other costly enterprise-grade solutions. You can learn more about those products from their websites, or from the software user review sites' marketing attribution sections. How to Calculate It On Your Own Are you in the growth curve too early to be able to afford software here? That is all right, here's how you can calculate your own marketing attribution software. Let's say you're spending $10,000 on a piece of direct mail, and you get 1 percent (100) of those people to buy a $200 product from you—50 from your call center and 50 from your website. You know the website orders were linked to the piece of direct mail, because the user needed to enter a unique promotion code to redeem the mailer offer. Potential Pitfalls in Your Calculations There are many instances creating challenges in calculation. For example, who gets credit for the sale of REPEAT — the channel that started the customer relationship or the channel that got the order repeated? We would bias the most recent channel here, but don't lose credit for the first channel's lifetime value calculations. Or, what happens if the tracking data is incomplete and you're not sure who should receive the sale credit? Then take the untracked orders and in the same percentages of the tracked orders allocate them pro rata. Concluding Thoughts Hopefully, you now have a better understanding of what marketing attribution model is, and why tracking is so important: it helps you to fine-tune your ROMI calculations by marketing channel to ensure that you optimize your channel marketing spending. The better with a customer-centered Omni- channel mindset you understand your customer behaviors ( e.g. touchpoints), the better you will be able to really take your marketing efforts to the next level.