A recent survey carried out by Adverity Research indicates that 67% of Chief Marketing Officers have “been overwhelmed by the quantity of marketing data available.”
There are many different tools for marketing attribution that integrate all the various marketing channels, with new ones are popping up every month. The amount of data being collected is also growing at an exponential rate.
The sheer number of marketing channels, the rapidly evolving tools, and the growing volume of data makes integrating and understanding marketing data a challenge. How do we make the best use of all this data and determine the marketing budget to spend on each of our marketing channels?
In other words, how should an organization allocate their marketing budget to return the highest return on investment (ROI)?
In this article we will illustrate the importance of marketing attribution and how RevGen Partners can help your organization identify the best marketing channels, attribute value to each channel, and use marketing data insights to make actionable decisions.
What is Marketing Attribution?
Marketing attribution is the science of analyzing and determining the best marketing strategy to manage lead conversions, total sales, and, ultimately, return on investment. There are several methods of valuing customer interactions with your organization or brand and developing a systematic approach to determining how to value different marketing channels. Determining which marketing attribution strategy is best for your brand will help you get the most value out of your marketing spend.
The growing number of marketing channels has created the need for new multi-channel marketing strategies that take both online and offline channels and integrate them into a holistic process where marketers can customize the journey of the customer through every step in the sales funnel.
Simply using the attribution software isn’t enough to identify how users’ actions, events, or points of contact during the lead generation and sales process support marketing agendas. Attribution models get outdated, new technologies are developed and new data sources become available, all of which can lead to missing out on viable opportunities.
What are the Benefits of Marketing Attribution?
Now more than ever, there are new, disconnected marketing channels. This makes it a challenge to identify which channels are giving you the highest conversions. Marketing attribution allows you to attribute a value to the marketing dollars spent. In short, it helps identify the channels with the highest ROI.
Marketing attribution data is collected by different methods depending on the channel. These sources can be Online such as Digital Ads, or Offline such as TV or Radio. The first and most high-level data is how much budget is spent by marketing channel. Then, how much revenue is directly attributed to each marketing channel.
Other customer data such as demographic and psychographic data can also be useful additions to collected marketing data. Knowing your audience and who converts to a paying customer will help your organization select your target market more successfully and increase your advertising ROI.
The most granular data follows the lead or customer’s journey. What ads did they click and in which order? Which ads made an impression on the customer? Which ads were clicked before conversion? This data will be useful in identifying the best marketing strategy for individual customers and distinct customer segments.
There are more marketing channels now than ever existed before, and within them, there are multiple strategies to convert leads into customers. The major marketing channels include: Email, Print, Web, Articles, TV, Radio, Social Media, Networking, Community, Digital Ads, SEO, User Reviews, Content, Mobile Ads, Newsletters, Webinars, Workshops, and Events.
However, that list is non-exhaustive, and new channels seem to spring up overnight. Having a clear understanding of which channels your organization uses — and which are the most valuable — is a necessary first step to making better decisions.
How Do we Attribute Value to These Channels?
Currently, there is no comprehensive system to evaluate all the above marketing channels. Google Analytics has tools to evaluate all the Google related ads. The same with Facebook, Twitter, and LinkedIn. Some services integrate Google and various social media ads. But how do we attribute value to Print, TV, Radio, Newsletters and Digital Ads, too? This system doesn’t exist.
The only solution today is to build a custom marketing attribution system that looks at all these marketing channels. Here at RevGen we can build a custom attribution model that can identify where to spend your marketing dollars for the highest ROI.
How Does an Attribution Model Work with Machine Learning?
Attribution methods have evolved significantly in the era of machine learning. As always, these models are a balance between explainability and accuracy. Google, for instance, has slowly increased its usage of more advanced models for click attribution.
Because of the variety of signals and time component, attribution has never been an easy problem, however with careful connection of data systems and model design that can integrate multiple modalities, accurate multi-touch, multi-modal attribution is closer to being in reach than ever before.
There are many methods for attributing value to a marketing channel. And in coming years, there will likely be even more ways for people to connect with your brand. Utilizing all these marketing channels is a challenging effort.
How do I best spend our marketing budget? Which channel should we increase spending, and which should we reduce to increase conversions? These are difficult questions that require a custom, data-centric approach.
At RevGen Partners, we can help your organization methodically optimize your marketing budget by creating a custom attribution model using your marketing channel data. To learn more about the services we offer, visit our Analytics & Insights page.
Derek Plemons is a Consultant in RevGen’s Analytics & Insights practice. He specializes in data science, machine learning, and big data.
Anne Lifton is a Principal Architect of Data Science and Machine Learning at RevGen. She has over 10 years of experience in building, deploying and managing the lifecycle of data science models across several industries and all three major cloud platforms.
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