First touch vs. last touch attribution models

The Team at Sona

The customer journey can be a long process. Customers can have tens or even hundreds of interactions with a brand through various marketing channels before they finally make a purchase.

You might have capture about the customer journey's final touchpoint prior to a conversion. But, what about the other marketing channels, such as social media posts, blogs, paid advertisements, and others, throughout the customer's journey that in some way or the other also influenced them to buy from your business?

To maximize your marketing efforts, you will need to measure the role of all your marketing channels throughout the customer journey. Given the complexity of the customer journey, the task is easier said than done.

This is where attribution modeling comes into the picture.

Attribution modeling is the process that makes it possible to analyze and assign credit to different touchpoints throughout the customer's journey. This process makes it possible to better understand which marketing efforts work and which do not work, using attribution models. This, in turn, helps them refine their marketing strategies and to better understand which activities are impacting a particular milestones in the customer journey.

What are attribution models?

What are attribution models? Photo by Towfiqu barbhuiya on Unsplash

Attribution models are a framework or set of rules used for analyzing the different touchpoints, such as blogs, landing pages, email marketing, google ads, and other marketing campaigns, throughout the customer journey.

The analysis provided by a particular model helps determine which touchpoints should receive the customer conversion credit. There can either be only one marketing touchpoint or multiple touchpoints that can receive an attribution credit.

Attribution models can be primarily classified into two types based on the number of touchpoints they take into consideration. There are single touch point attribution models and multi-touch attribution models. Moreover, the models can also be classified as rule-based models and data-driven models based on their methodologies.

The marketing attribution model to choose for your business will depend on several factors, such as the products and services you provide and the length of the customer journey.

Marketing teams do not need to limit themselves to using just one of the above standard models. You can choose multiple models to compare the performance of various touchpoints. This can help better understand the importance of the touchpoints in the buying journey.

Generally, the first and last touch attribution models are businesses' most commonly used marketing attribution models. In this blog, we will take a detailed look at the first touch and last touch attribution models, their pros and cons, and other aspects in detail later in the blog.

We will start with looking at some of the general benefits of using attribution models.

What are the benefits of attribution models?

Benefits of attribution models Photo by Towfiqu barbhuiya on Unsplash

Attribution modeling provides numerous benefits that help businesses derive a more significant ROI from their marketing campaigns. Some of the benefits of using attribution models include the following:

  1. Understand Buying Trends
  2. Attribution modeling helps marketers understand the patterns and trends in how customers move through the path to purchase. This helps in creating and optimizing marketing campaigns.
  3. Enhance Return On Investment
  4. Attribution modeling helps marketers understand what's working and what's not. Thus, they can optimize the messaging and timing of future marketing strategies that better resonate with and reach a broader target audience. This eventually leads to an increased return on investment.
  5. Develop Personalized Marketing Campaigns
  6. Every business has different types of customers, each with a different engagement method, marketing message they connect with, and the channel through which they make a purchase. The models help understand these factors in detail, which enables marketing teams to develop personalized marketing campaigns that better connect with each member of the target audience.

Now that we have understood the benefits of attribution models, let's take a look at single touch and multi touch attribution models.

What is single touch attribution vs. multi-touch attribution?

Touchpoints for customer journey

As stated earlier, attribution models can be classified as single touch attribution models or multi-touch attribution models based on the number of touchpoints to which they assign credit in the customer journey.

Single touch attribution models

Single touch attribution model

A single touch attribution model gives all the credit to only a single customer touchpoint in the customer journey. The credit is usually assigned to the first or the last marketing touchpoint, where the customer interacted with your business.

For example, suppose a customer finds out about your product through a Facebook ad. They then go on Google to find more information about your company. Finally, they click a link shown on your Instagram page, which redirects them to your website, from where they finally make a purchase.

In this case, the single touch attribution model will assign credit to either the Facebook advertisement (first touchpoint) or the Instagram page (final touchpoint).

The types of single touch attribution models include:

  • First touch model
  • Last touch model
  • Last non-direct model

Multi touch attribution models

Multi touch attribution model

A multi touch attribution model assigns credit to every touchpoint in the customer journey with an appropriate amount of value. Let's consider the previous example to understand multi-touch attribution models.

The multi-touch attribution model will assign credit to each of the touchpoints, the Facebook advertisement, the Instagram advertisement, and the website. However, not every touchpoint will get equal credit. The credit will be assigned based on its importance in the buyer's journey. So, the Instagram page can be assigned more credit, whereas the Facebook advertisement can be assigned less credit by the multi-touch attribution models.

The types of multi touch attribution models include:

  • Linear attribution model
  • Time decay modeling
  • W shaped model
  • Z shaped model

Custom model

Businesses can also create a custom attribution model if they want a nuanced look at how marketing touchpoint(s) are impacting sales. Businesses can assign custom weights to whichever touchpoints, such as the last channel, they think are the most important in the purchase journey. This type of model provides a custom and complete understanding of the vital touchpoints. The only drawback, however, is that it requires an enormous amount of data and is difficult to create.

Businesses can use any of the attribution models based on several factors, such as the type of business, the marketing resources, marketing performance, the analytics required, and other factors.

Now that we have looked at the definition for single touch and multi-touch attribution models, let's go through the benefits of each.

What are the benefits of single touch attribution?

The benefits of single touch attribution models include:

Easy to setup

Single touch attribution models are easy to set up and use. Since the customer journey is long and complex, many marketers prefer to use single touch attribution models for their simplicity.

Focus on important touchpoints

Single touch attribution models focus on the two important touch points in a customer's journey - the first marketing touchpoint and the last marketing touchpoint. This helps to provide a broader picture of the marketing campaign's performance without spending much time, effort, or resources.

What are the benefits of multi-touch attribution?

The benefits of multi-touch attribution models include:

Granular data at a high-level of detail

Multi-touch attribution provides in-depth data about all the customer touchpoints, such as the first-touch, e-mail, organic search, paid search, and others. This helps marketing teams uncover valuable information to identify effective and ineffective channels and to develop future campaigns that attract a broad base of new customers.

Differential weights to each touchpoint

Multi-touch attribution models assign an appropriate amount of weight or value to a touchpoint based on its importance to the customer journey. For example, they can assign 20% credit to an email campaign which resulted in the first-touch, 40% credit to Instagram ads which resulted in the last-touch, and 40% credit to a organic search website visit which resulted in a middle touch, based on their importance in the final sale.

What is a first touch attribution model?

First touch attribution model

The first touch attribution model, also referred to as the first click attribution model, is a single touch attribution model where the entire credit is assigned to the first point of customer interaction in the customer's path, irrespective of where the final conversion occurs.

This model can be helpful to understand how a customer discovered your business in their journey to making a purchase. If they never come across your business, there will be no interaction and engagement and eventually no sales. The first touch model works best for businesses that have a short buyer's journey or buying cycle.

Example

Suppose a customer finds out about your product on Instagram first, then Instagram gets 100% credit, even if the purchase is made through a separate visit to your WooCommerce store.

First touch attribution is generally used by companies who have a lengthier sales cycle, looking for long-term opportunity creation rather than a one-time sale, and who want to find out which marketing touchpoints most commonly source customers to their business.

What are the pros of a first touch model?

The pros of using a first click attribution model include:

Easy to setup and understand

The biggest advantage of the model is that it is simple and straightforward to set up and understand. There is no rocket science involved as 100% of the credit is assigned to the first touchpoint.

Increase brand awareness

The model is great for understanding the best channels at the top of the funnel. Businesses can use this information to enhance the first touchpoint, such as an email campaign, that can boost brand awareness.

What are the cons of a first touch model?

The cons of the first touch attribution include:

The entire buyer's journey is not taken into consideration

First touch attribution focuses only on one marketing touchpoint, i.e., the first interaction. However, to better understand what exactly caused the customer to make a purchase, you need to consider the entire buying journey.

Best for businesses with a short buying cycle

The first touch model is the best model for businesses where customers make a purchase within days or weeks after first interacting with the brand, such as clothes. However, the model fails if the buying cycle is generally long, e.g. customers take months to make a buying decision such as cybersecurity solutions.

When should a business leverage a first touch marketing attribution model?

Businesses should use first touch attribution when they want to have a better understanding of what marketing channels bring the most customers to the top of the sales funnel. This is helpful for new and old businesses who are focusing their marketing efforts on improving brand awareness among its target audience.

Similarly, businesses who have high click through rates on various marketing mix but low overall sales can use first click marketing attribution.

Finally, if businesses have a limited marketing budget to spend or don't have in-house data science capabilities, then they should leverage first touch attribution.

What is a last touch attribution model?

Last touch attribution model

A last touch attribution model, also referred as last click attribution model, is a type of marketing attribution model that gives credit to the last interaction that a customer has with a brand before making a purchase.

This means that if a customer sees an ad, clicks on it, and then makes a purchase, the sale will be attributed to the ad. Last touch attribution models are often used by marketers to assess the effectiveness of their advertising efforts.

Example

If a customer sees an ad for your product on Facebook first and does not click on it but later sees another ad on Instagram and clicks on it before making a purchase, the first ad seen by the customer on Facebook would not be given any credit in a last touch attribution model. Rather, it will be assigned to the Instagram ad.

What are the pros of a last touch attribution model?

The pros of last touch click attribution include:

Easy to setup and understand

Similar to first touch, last click attribution is easy to setup and understand as it assigns 100% of the credit to the last touchpoint in the consumer's journey.

Most accurate model

This model provides the most accurate details of where exactly the customer made a purchase. Thus, it helps t find out which marketing channels persuade the customer to take a purchase action.

When should a business leverage a last touch marketing attribution model?

Businesses should leverage this model when they have already created a strong brand presence and awareness among the target audience but are facing difficulties in converting them into customers.

Similarly, if the business have a low marketing budget or don't have an in-house data science team, then they should utilize the last touch marketing model.

What is the difference between rule-based vs. data-driven attribution models?

Attribution models can be classified as rule-based and data-driven based on how they are constructed. Rule-based models are multi channel attribution models that rely on predefined rules to determine how much credit different channels should get, while data-driven models use actual customer data to calculate the credit each touchpoint deserves.

Rule-based attribution models

Rule-based attribution assigns credit for a sale to a particular marketing channel based on predefined rules. For example, a rule might be that the first touchpoint gets 100% of the credit for the sale, while all subsequent touchpoints get 0% of the credit. This type of attribution is not very flexible and can't adapt to changes in customer behavior.

pros of rule-based models

A major advantage of rule-based models is that they can be customized to match your business' unique needs. For example, you can create rules that consider the customers' purchase history or the channels they typically use to interact with your brand.

Also, rule-based models are often easier to set up and maintain than data-driven models. This makes them a good option for smaller businesses that don't have the resources to implement a sophisticated data-driven attribution model.

Data-driven attribution models

On the other hand, data-driven attribution uses actual customer data to calculate the credit each channel deserves. This type of attribution is more flexible and can adapt to changes in customer behavior. It also takes into account how customers interact with different channels, which can give you a more accurate picture of how your marketing is performing.

Pros of data-driven models

The biggest advantage of data-driven attribution models is that they are more accurate than rule-based models. They are able to take into account all the interactions a customer has with a brand, not just the interactions that fit into a pre-determined set of rules. This makes them much more effective at identifying the most important touchpoints and assigning the correct credit to them.

Conclusion

You need to be selective about choosing the appropriate model for your business. You need to focus on the end goal, the complexity of the customer journey, sales cycle, and other factors to determine the best model.

That being said, there is no one definitive best model for a business to track attribution along the customer journey. We hope this blog will help you in making an informed decision regarding choosing the best attribution model for your business.

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