There are numerous types of marketing attribution theories, methods, and frameworks that are used to measure the effectiveness of marketing campaigns.
Each uses a different approach and set of principles to understand the customer journey, track interactions, and assign credit for conversions – but what exactly are marketing attribution models, and how do they work?
While they all have an end goal of identifying the most effective marketing channels and campaigns (which many of us are familiar with), the actual theories behind them may not be as well known.
By understanding these theories, marketers can better evaluate and improve their strategies to drive successful campaigns. And some of these frameworks will be more valuable to your business than others.
We’re going to take you through each of the different multi-touch marketing attribution theories and give you a rundown of their principles so that you can better understand how they work and how to use them.
The Key Points…
- Marketing theories, such as marketing attribution frameworks, are used to explain how different marketing activities influence customer behaviour and contribute to conversions across the customer journey.
- In attribution, theories on marketing determine how credit is assigned to individual touchpoints, such as first-touch, last-touch, linear, and multi-touch models.
- Different marketing theories produce very different performance insights, which can significantly impact budget allocation and strategic decision-making.
- Understanding marketing theory helps businesses identify the strengths and limitations of traditional marketing attribution models that focus only on digital or final interactions.
- Data-driven and multi-touch marketing theories provide a more accurate view of performance by accounting for every meaningful customer interaction.
What is the Multi-Touch Marketing Attribution Model?
Just to cover the basics, let’s start with what the marketing attribution model actually is.
In simple terms, it is a framework used to determine how much ‘credit’ each marketing touchpoint receives for a sale or any other conversion you are tracking.
| For example, a customer may come across an ad on social media for an electric bicycle, then see a banner ad for the same product on a website, and eventually make their purchase by directly visiting the company’s website. |
In this scenario, each of these touchpoints played a role in the customer’s decision to make a purchase and can be credited for it.
Marketing attribution models help businesses understand which channels and campaigns are most effective at driving conversions and, ultimately, revenue.
Why is it Important for Marketers to Understand Marketing Attribution Theories?
Having a clear understanding of attribution theory can greatly benefit marketers in several ways:
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If a business isn’t taking note or deep-diving into their marketing attribution, it could be missing out on valuable insights and opportunities for growth.
Resources are limited, and understanding attribution theory can help ensure you are making the most of your investment.
Different Types of Theories on Marketing Attribution
The way in which these customer journey touchpoints are credited depends on the type of marketing attribution theory used in the model. Depending on the theory, each touchpoint will be given a different weight or value in the customer’s path to conversion.
Let’s explore some of the most commonly used marketing attribution theories:
| Marketing Attribution Model | Explanation of Model |
| Time-Decay Attribution | Gives credit to the touchpoints closest to the conversion, with the most recent touchpoints receiving a higher value. |
| First-Touch Attribution | Attributes all credit for a conversion to the first touchpoint in the customer journey. |
| Last-Touch Attribution | Attributes all credit for a conversion to the last touchpoint in the customer journey. |
| Linear Attribution | Gives equal credit to all touchpoints along the customer journey. |
| Multi-Touch Attribution | Assigns weight to every touchpoint in the customer journey based on its value contribution to the conversion. |
1) Time Decay Attribution
This theory gives credit to the touchpoints closest to the conversion, with the most recent touchpoints receiving a higher value. In this model, the first touchpoint receives less credit than the last touchpoint before conversion.
| Example: In the electric bicycle scenario mentioned earlier, the banner ad on the website would receive more credit than the social media ad as it was closer to the conversion (i.e., the purchase). |
Essentially, this theory assumes that the closer a touchpoint is to the conversion, the more influential it is in making the sale, so it is considered to be more valuable.
The UniFida Marketing Attribution model uses machine learning to assign weights to each touchpoint using the time-decay theory, alongside crediting events that keep customers interested before the sale closes.
2) First-Touch Attribution
This model attributes all credit for a conversion to the first touchpoint in the customer journey. It assumes that the initial contact with a brand has the most significant impact on a potential customer’s decision.
| Example: In our electric bicycle scenario, social media would receive all the credit for the sale. |
This theory may be useful for businesses looking to increase brand awareness and reach new customers, as it emphasises the importance of the initial touchpoint.
Of course, the downside of using this model is that it doesn’t take into account any other touchpoints that may have also influenced the conversion. The display ad could have been the deciding factor in making the sale, but it would not receive any credit under this theory.
3) Last-Touch Attribution
As the flip side to FTA, Last-Touch Attribution attributes all credit for a conversion to the last touchpoint in the customer journey.
| Example: In our electric bicycle scenario, the direct visit to the company’s website would receive all the credit for the sale. |
This model is useful for businesses looking to focus on the final actions that lead to conversions.
However, it also ignores any other touchpoints that may have contributed to the customer’s decision.
Using our example again, you could argue that, were it not for the social media and display ad, the customer may never have been aware of the product in the first place.
4) Linear Attribution
This model gives equal credit to all touchpoints along the customer journey. It assumes that each interaction with a brand holds equal weight in influencing a potential customer’s decision.
| Example: In our electric bicycle scenario, the social media ad, website ad, and direct visit to the company’s website would each receive 33.3% credit for the sale. |
This theory may be beneficial for businesses that want to take a holistic approach to attribution and give value to all touchpoints in the customer journey.
The problem with this model is that it doesn’t consider the individual impact of each touchpoint.
Some touchpoints may have a more significant influence on conversions than others, so giving equal credit may not accurately reflect their actual contribution, either over-reporting or under-reporting their impact.
5) Multi-Touch (or Data-Driven) Attribution
As the name suggests, this model is tailored to a business’s specific needs and takes into account their unique customer journey and touchpoints. It uses machine-learning to assign weights to each touchpoint (multi-touchpoints), taking into account their individual impact on conversions.
| Example: In our electric bicycle scenario, the custom attribution model may consider factors such as the customer’s past interactions with the brand and their behaviour on the website before making a purchase. |
This model offers a more accurate and comprehensive view of marketing performance, taking into account all relevant touchpoints and their impact on conversions.
While it requires a large amount of data and analysis, it is the most effective way to understand a business’s specific customer journey and make informed decisions on marketing strategies.
Other theories include: Full-Path Attribution, W-Shaped Attribution, and U-Shaped Attribution.
What is the Best Marketing Attribution Model?
We firmly believe that a multi-touch attribution model is the most effective for businesses looking to gain a comprehensive understanding of their marketing performance.
Many of the other frameworks are limiting in their approach, either overestimating or underestimating the impact of specific touchpoints. Some also don’t consider the full customer journey, which can result in missed opportunities for improvement.
Ultimately, the best marketing attribution model will be unique to each business and their specific goals. But if you want to gain the deepest and most accurate insights into your marketing performance, an MTA model is the way to go.
What is Marketing Mix Modelling (MMM) – & How Does it Relate to Attribution?
With the goal to hone in on the ROI of marketing efforts, the MMM approach takes into account various offline as well as online marketing channels and external factors to determine their individual contribution to sales or conversions.
The key difference between MMM and other attribution methods is that it considers both online and offline touchpoints, whereas traditional attribution models often focus solely on digital (or direct) touchpoints.
Just think about the electric bicycle example – factors such as weather, competitor activity and demand levels for electric bicycles could all impact sales. MMM takes these into account to provide a more accurate view of marketing ROI.
Combining MTA & MMM
While MMM provides valuable insights into the overall impact of marketing efforts, it doesn’t provide a granular view of individual touchpoints’ performance. By combining MTA and MMM, businesses can gain both a macro and micro perspective on their marketing strategy.
With MTA providing an in-depth analysis of each touchpoint’s contribution and MMM giving a broader view of overall performance, together, they provide a more holistic understanding of marketing effectiveness.
Here at UniFida, we use MTA and Econometrics (or MMM) to provide a complete view of your marketing performance, giving you the insights and tools you need to drive successful campaigns and maximise ROMI.
Our approach combines data analysis, machine learning, and our proprietary algorithms to deliver a comprehensive view of your customer journey and attribution.
Learn More About Our Marketing Attribution Solution
Summary: Understand Marketing Attribution to Understand Your Customers
Marketing attribution is a crucial concept for businesses looking to understand their customer’s journeys and the effectiveness of their marketing efforts.
Becoming knowledgeable in the different attribution theories and finding the right model for your business can provide valuable insights into how to drive conversions and increase ROI.
If you are looking to take your marketing attribution efforts to the next level, UniFida can help. We’ll work with you to create a bespoke attribution solution, using our combination of MTA, Econometrics (MMM), and our proprietary algorithms.
Contact us today to find out more about how we can help you gain a deeper understanding of your customers and optimise your marketing strategies for success.
Enquire Today for More on How UniFida Can Help
UniFida is the trading name of Marketing Planning Services Ltd, a London based technology and data science company set up in 2014. Our overall aim is to help organisations build more customer value at less marketing cost.
Our technology focus has been to develop UniFida. Data science business comes both from existing users of UniFida, and from clients looking to us to solve their more complex data related marketing questions.
Marketing is changing at an explosive speed. Our ambition is to help our clients stay empowered and ahead in this challenging environment.
Jo is a leading expert in the field of marketing measurement, particularly in integrating marketing attribution and econometrics for holistic customer journey mapping and optimised marketing returns. Jo actively promotes best practices in media measurement and sustainable marketing within the wider business community. Jo co-wrote the marketing attribution book ‘The key to proving the true value of marketing’.
