Modern branding is evolving at a rapid pace. Companies no longer expect their customers to buy on the first click to their website.
Customers, these days, make their decisions carefully. They read and watch your content, look at reviews, follow you on social media platforms, and often visit your website dozens of times before making a purchase.
Lead attribution aims to measure this process, and you’ll be surprised to know that there’s more than one way to tell this story.
It’s a story whose ending can determine the success or failure of a business. In short, the ability to attribute revenue to marketing leads is no longer a “nice to have” option. It is a “must have.”
Without lead attribution, strategists and marketers do not have a clear view of what’s working and what’s not. And the inevitable consequence would be wasted time and money on campaigns that fail to generate value. Most marketers realise that they need to connect their marketing leads with later-stage funnel metrics, but developing an effective lead attribution strategy has its own challenges.
That’s why we put together a detailed, comprehensive guide to lead attribution and some tips for attributing sales to marketing leads.
Ready? Let’s do it!
What Is Lead Attribution?
Lead attribution, also known as marketing attribution, is a technique for evaluating the success of sales channels by analysing and allocating credit to each touchpoint that leads to a conversion or sale.
Lead attribution is extremely valuable because it informs companies which marketing activities do and don’t result in leads, and it’s the most effective way to optimise their marketing investments.
“Half the money I spend on advertising is wasted; the trouble is I don’t know which half,” John Wanamaker said more than 100 years ago. And in today’s competitive market, you can’t afford not to know which half was wasted.
Lead attribution is often quite underrated because it doesn’t have the creative glory of other marketing practices like copywriting, design, content marketing, or branding. But it should become your go-to strategy for organising, refining, and adapting your overall marketing efforts.
Let’s explain the process with an example. Let’s say you’re part of the marketing team using a software company that offers multi-touch attribution and applies last-click attribution reports in Google Analytics. A user googles “marketing attribution software,” clicks on an ad, books a demo, and becomes a lead. Based on this model, you’d attribute 100% of the conversion credit to Google Ads.
Well, that wasn’t so hard; then what’s all the fuss about? It is incredibly challenging to figure out what ultimately caused a customer to act the way they did. Perhaps the customer clicked on the ad because they read a newspaper ad from the company the other day. Later, they saw the digital ad and thought, “This brand seems reputable,” and viola New customer!
If a company attributes the lead solely to the digital ads and sees print ads as a waste, it can hurt lead flow/generation. This is because future customers will have a harder time trusting and clicking on digital ads
Lead Attribution Models
Having said all this, it is not surprising that there has been an explosion of attribution models. These models may differ in many ways, but they all serve one purpose. They help companies track and allocate marketing-generated revenue back to leads. In other words, attribution models act as a framework that tracks how your website visitors and customers engage with your marketing channels before converting them into leads or sales.
Within attribution models, there are two general categories: single and multi-touch. As the name implies, single-touch attribution models allocate 100% of the credit for a lead to a single touchpoint. Multi-touch attribution, on the other hand, allows marketers to analyse the entire conversion path in more detail and assign credit to more than one touchpoint.
With multi-touch attribution, credit is split between different interaction points. For example, 50% is credited to the email signup, 40% to the Facebook ad, and 10% to the print ad. This can be quite a complicated way to track attribution but has the advantage of higher accuracy. Now let’s go through the most common marketing attribution models.
First Click Lead Attribution
The first-click marketing attribution model is probably the most common and simplest model for tracking conversions and lead generation. In this model, 100% of the value is assigned to the very first interaction. First-click attribution has its own shortfalls, but it’s still a phenomenal model for assessing how people learn about you.
Last-Click Lead Attribution Model
Another popular marketing attribution model is the last click. It measures the final touchpoint on the conversion path, the point closest to purchase completion. In many cases, the last click model is undoubtedly more reliable than the previous model, but does it deserve 100% of the credit? The answer is rarely yes.
It is conceivable that when a user types your brand into a search, they have already decided to make a purchase. What led them to this last step is entirely missing in this model since the last search itself didn’t contribute much to the purchase decision. In this case, the last click does not provide any real insights into the effectiveness of your individual marketing strategies and tactics.
Last Non-Direct Click Lead Attribution Model
We need a slightly different perspective on the conversion journey to understand how this attribution model works. Last non-direct click attribution works similarly to the last click model but with a tiny twist. The direct click is ignored, and 100% of the credit is assigned to the last marketing channel that captured the user’s attention before converting to a lead.
So the last non-click attribution model ignores the direct touchpoint, based on the assumption that the organic visit must be credited for the conversion.
Linear Lead Attribution Model
The linear attribution model divides the conversion credit evenly across the customer journey, giving equal weight to each touchpoint. This is an ideal model for a conversion path with few touchpoints and low complexity.
The logic behind this model is simple. Each touchpoint – even the one you assume contributes the most – is useless without the others. They function as a system. So if the system seems to be working well, we should reward each interaction point equally.
That may be a good argument, but only as long as the conversion path works 100% of the time. If it does not, which is almost always the case, we need to find weaknesses in the way and improve the model or replace it with a new, more refined marketing channel.
Time Decay Lead Attribution Model
Time-decay attribution is a trendy multi-touch attribution model that gives some credit to all channels that lead to your customer’s conversion. The amount of credit decreases the further in the past the interaction occurred.
The guiding principle behind this model is that the first advertising channel your customer interacted with merely planted the seed. The customer’s interest in making a purchase grew over time through repeated exposure to various marketing channels. Over time, each channel generates more and more interest and engagement from the customer.
Time-decay attribution is particularly helpful in measuring longer sales cycles, but it has one major drawback. The customer journey may not necessarily be best represented by lowest to highest value interactions.
Position-Based Lead Attribution Model (U-shaped)
The position-based attribution model splits the credit for a sale between a potential customer’s first interaction with your brand and the moment they convert into a lead. Each of these points is attributed 40% of the credit, and the remaining 20% of the credit is shared equally among all other touchpoints, regardless of how many there are.
This is a robust model for businesses with multiple touchpoints before a conversion. However, it gives more weight to two interactions that may or may not have contributed to the conversion based on this attributed credit.
Full-Path Lead Attribution Model
Full-path models allocate credits to interactions throughout the customer journey. In these models, 22.5% of revenue credits are given to each of the first touches, the lead generation touch, the opportunity creation touch, and the closed-revenue touch. The remaining 10% is distributed among all other touchpoints.
This model accounts for sales initiatives and helps you connect the dots between sales and marketing. However, you may need to adjust the weight attributed to each stage to fit your company’s channel mix.
How To Get Started?
So far, we’ve established that lead attribution is a must for any business, but without the right strategy and tools, you may end up wasting even more time and energy. So here’s your roadmap:
Direction: Revenue Generation
The most significant step in matching marketing leads with revenue is setting your revenue generation goals. Then explore different strategies and see which one delivers the best results in terms of marketing leads and conversions. Remember that trial and error are unavoidable.
Map Out the Customer Journey
The customer journey map is a visual representation of the steps a customer goes through, from initial interaction to purchase, loyalty and retention. It allows marketing, sales, and customer support teams to ensure that every potential opportunity is thoroughly explored.
Use Marketing Attribution Software
With lead attribution software, you can cross the line between marketing and sales by gaining insight into how, where, and when your marketing efforts impacted a lead. There are many options, but the best software is the one that best fits your business interests and efficiently delivers what you want.
Google Analytics; An Easy Way In
The Google Analytics tool can be an excellent free alternative to paid lead attribution tools if you don’t have the budget to spend on them. Google Analytics isn’t the ultimate best solution, but it does have a wealth of powerful features to help you get started.
Get To the Source
Ask your customers how they discovered you! They are the best source of actionable data and the best way to determine your effective communication channels. Once you find your strengths, you can optimise your marketing performance based on customer feedback rather than guesswork.
Bottom Line
Understanding the different attribution models takes time and experience, but they are essential to improving your campaigns, reducing wastage, and attracting more qualified leads to your business. But a one-size-fits-all solution is never right for you.
That’s why at BroadWeb, we can help you build a need-specific path to lead generation.
Contact us now, and we will develop a tailored digital marketing strategy and launch marketing campaigns for your business.
