Jonas Hagströmer Theodorsson

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What is Attribution modelling and why is it important for your e-commerce?

Google Ads | 13 Min

In this article we will look at the basics of attribution modelling and why it can play a crucial role for your e-commerce. We will discuss what, why and how to deal with attribution.

What is Attribution Modelling?
Attribution modelling is a system which can help you get the most from your marketing mix. Today many shoppers are used to searching for information and best prices so they will not necessarily purchase the first offer they see online. However, each time they return to your page they might do so through a different channel. Attribution modelling means that you look at these different channels and encounters or interactions and give them a value so let's have a look at the different types of interactions that can take place:

Types of Interaction

  • Direct: A customer types your URL into their browser and lands on your website without any marketing influence.
  • Organic: A customer searches for your company, or a relevant search word which is very niched to your business and quite instantly is presented several links.
  • PAID: A customer searching for products you sell sees your adverts usually at the top of his page if you have a successful marketing campaign. This campaign comes at a cost.
  • Referral: You have a link on another site which directs customers to your site.

Types of Attribution Model
Now that you know how a user can come to visit your site lets have a look at the different ways of how you can put value on their interaction.

Last Interaction -

attribution-modelling-last-interaction

A very often used setting this method assigns 100% of the value of the conversion to the last interaction the customer had on the site. This is a very simple way to establish value but it does not accredit any previous touchpoints.

First Interaction -

attribution-modelling-first-interaction

100% of the credit goes to the fist interaction the customer makes with your website. Some marketers use this value base because they feel that without the paid advertisement the customer would not have found the website. So all the other interactions post that one are less important to them.

Linear -

attribution-modelling-linear

So if a user visits your site 4 times out of 100% one would accredit each interaction 25%.

Position Based -  

attribution-modelling-position-based-1

This is quite a popular method and is often referred to as the Bathtub model. This model gives most value to the first and last interactions.

Time Decay -

attribution-modelling-time-decay

Some marketers prefer this model which is basically increasing value to every step of the journey.

Data-Driven attribution

This could be done in many different ways. Based on your data you could build your own attribution model to capture your consumers unique behaviour. 

How does your different marketing channels contribute or predicting your customers Life Time value? These types of questions are something we typical build custom made attribution models and use them to optimise the budget allocation.

Google Ads has their own data driven attribution model, that you could use if you have enough conversion.

Youtube video, Google Ads Data Driven Attribution 

So why is Attribution Modelling Important?
Simply put, attribution modelling helps you understand which marketing channels work and which do not. By looking at attribution modelling a bit deeper you can start understanding which channels are truly valuable for you and you will notice that there is a large process behind leading up to a conversion.

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Dec 10, 2018 11:20:25 PM 13 Min Yes