The Online Attribution Conundrum
Attribution is commonly used to refer to the value assigned to a particular sales channel (keyword, display advertisement, coupon code, ect…) for pushing customers to purchase your product. Attribution is used to calculate the Return on advertising spend or ROI for each of your sales channels. The picture below shows how a customer can touch your brand several times before finally being coerced into being comfortable enough to purchase.
In the example displayed above our customer, Susie, has interacted with the brand on four occasions before seeing a billboard on her afternoon commute and purchasing the widget online. In this example which of the five different advertisements (Email, Organic Search Traffic, TV, Blog or Billboard) should get the value of her purchase? This is the typical attribution conundrum!
Attribution allows the marketer, who has built the proper tracking mechanisms on their advertising channels, to choose how to distribute the value of Susie’s purchase. This could be straight forward by giving the billboard 100% of the value or could be more liberal by spreading the value across all five channels that touched the consumer on their journey towards purchase. Gauge Potential recommends spreading the value across all 5 channels but giving the billboard a larger percentage of the sale because it was most effective in converting Susie into a customer.
By tracking marketing channels this way you start to see how your marketing mix holistically improves sales. These individual touch points do not become fully operational until they are coupled with other touch points that act as reinforcement. Individually these mediums work but holistically they work wonders to lift your overall sales. To truly have an effective online strategy you have to understand how these mediums are driving sales individually and holistically which is where attribution normally comes up. Marketing attribution is core to developing your online maturity but is more of an advanced topic that I would like to table for today. Instead, I would like to talk about an earlier stage attribution problem facing traditional offline businesses today.
Website Sales vs Offline Sales Attribution
Website attribution experienced at an earlier stage can halt your web strategy if you are not careful. When moving a traditional offline business online you have to carefully consider the ramifications that your online channel will be delivering higher value, lower cost customers to your brick and mortar business or may even be cannibalizing your offline sales. Depending upon your business model this may be a huge concern. Many companies reward their teams for reaching sales goals but if an offline team has to compete with the website team than you may have a mutiny on your hands.
I recommend thinking long and hard to find a happy medium where both your online and offline leadership benefit from the new found growth of your organization instead of pitting them in a cage fight to the death.
