Single vs. Multi-Touch Attribution Models

The Team at Sona
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Single vs. Multi-Touch Attribution Models

In today’s data-driven marketing landscape, demonstrating the impact of marketing efforts on the bottom line is more critical than ever. This is particularly pertinent considering that research indicates marketers adept at calculating their return on investment (ROI) are 1.6 times more likely to secure increased marketing budgets compared to their counterparts. However, some marketers still struggle to effectively demonstrate their marketing efficacy.

Attribution models emerge as key tools to address this challenge. These frameworks offer a comprehensive approach, tracking customer interactions across various channels. By accurately identifying which touchpoints contribute to lead generation, conversions, and revenue growth, these models empower marketers to shift from guesses to data-informed decision-making, optimizing marketing campaigns and maximizing marketing ROI.

This blog delves deep into the world of attribution models, exploring various options - from basic first-touch to advanced multi-touch models - helping businesses choose the right fit for their business goals. The blog will also guide implementation and analysis, effectively transforming marketing into a strategic driver of growth.

What Is Attribution Modeling?

Attribution modeling is the framework used to implement marketing attribution. It is the entire process and methodology utilized in analyzing and attributing credit to various marketing touchpoints throughout a customer’s journey to conversion. These touchpoints include clicking on an ad, visiting a website, engaging with social media posts, or receiving an email. Essentially, it determines which marketing efforts truly contributed to a sale.

What Are the Benefits of Attribution Modeling?

Leveraging attribution modeling in your marketing strategies unlocks valuable benefits, with the primary advantage being precise revenue attribution across diverse marketing efforts. This granularity helps understand and demonstrate the impact of different channels on revenue growth and overall ROI. For a deeper dive, read our article, "The Importance of Accurate Revenue Attribution," which explores the critical role of precise revenue attribution in optimizing marketing strategies.

Beyond revenue attribution, key benefits include:

  • Enhanced Customer Journey Insight: Gain a clearer picture of how distinct marketing channels influence customer decisions and conversions.
  • Data-Driven Decision-Making: Efficiently allocate resources by understanding how each marketing channel contributes to conversions.
  • Campaign Optimization: With performance insights, marketers can refine strategies for better results.
  • Increased Return on Investment: Focusing on high-performing channels demonstrably improves overall marketing ROI.

Having established a foundational understanding of attribution modeling, we now turn our attention to the specific frameworks that make this possible: attribution models. These frameworks serve as the analytical instruments within attribution modeling, each offering a unique perspective on the customer journey through specific analysis and interpretation methods.

What are Attribution Models?

Attribution models play a crucial role in marketing analytics, offering a systematic way to evaluate and improve the impact of diverse marketing activities. These models analyze how customers interact with marketing materials, revealing which aspects effectively contribute to the decision-making process. This analysis helps businesses make informed decisions about where to make marketing investments for maximum return.

Understanding the nuances and strengths of these models is essential for selecting the one that aligns seamlessly with your marketing objectives, thus revealing the wealth of insights within your customer data.

Definition and Core Functionality

Attribution models are the specific configurations within the practice of attribution modeling that dictate how credit for sales and conversions is distributed across various marketing touchpoints along a customer’s journey.

Marketing involves multiple touchpoints, but understanding which ones contribute to conversions can be challenging. Attribution models help by allocating credit to different channels and interactions influencing a customer’s conversion path.

Marketers can refine their approaches by choosing the most suitable attribution models, ensuring that every touchpoint plays a valuable role in the conversion journey.

Role in Marketing Analytics

Attribution models are crucial in marketing analytics, guiding data-driven decision-making. Integrated into tools like Google Analytics, they offer marketers a comprehensive view of performance across both online and offline channels. Businesses can use data from these models to pinpoint trends and patterns in customer behavior, evaluate the ROI of various initiatives, and refine their strategies for greater impact.

Moreover, in today’s data-centric landscape, quantifying the impact of each marketing effort is essential. It empowers businesses to justify their marketing spend and focus on strategies that yield measurable results.

Overview of Different Types of Attribution Models

Attribution models are broadly classified into the following two types, each offering a unique method for assigning credit to marketing touchpoints: single-touch and multi-touch models.

Single-touch models simplify the customer journey by assigning the conversion credit to a single key interaction, either at the beginning or the end of the customer’s path to purchase. This simple approach, while effective in certain scenarios, can overlook the multi-faceted nature of modern marketing strategies.

On the other hand, multi-touch attribution models take a more comprehensive approach, distributing conversion credit across multiple touchpoints, including both online and offline interactions. This method acknowledges the complex interplay of various marketing channels and interactions a customer experiences before a purchase. It’s especially relevant in multi-channel attribution, where understanding each channel’s impact on the customer journey is vital to an effective marketing strategy.

To gain a deeper understanding of incorporating offline channels in your attribution strategy, refer to "The Essential Guide to Offline Attribution: Maximizing ROI Through Offline Channels," which provides extensive insights into offline attribution.

Each model, whether single-touch or multi-touch, presents distinct insights and advantages. Choosing the right model depends on the specific needs and intricacies of a business’s marketing strategy. In the following sections, we’ll explore both attribution model categories, helping you identify the most effective approach for your B2B marketing goals.

Example of a Customer Journey For Examining Attribution Models

Consider a customer journey example (the “Customer Journey Example”) to better understand these models. This journey will demonstrate how different types of attribution models operate:

  • Touchpoint 1 - Pay-Per-Click Ad: A potential client first discovers your brand through a pay-per-click ad from a paid search campaign.
  • Touchpoint 2 - Newsletter Link Click: They then click on a link in a newsletter they received after subscribing to your email list.
  • Touchpoint 3 - Webinar Attendance: The client attends a webinar hosted by your company, which they learned about from the newsletter.
  • Touchpoint 4 - Website Visit: Finally, the client makes a purchase after directly visiting your website a few days later.

This journey will be our reference as we explore how each attribution model interprets and credits these touchpoints, guiding you to choose the most effective model for your marketing objectives.

What is a Single-Touch Attribution Model?

A single-touch attribution model allocates all the credit for a conversion, such as a purchase or a sign-up, to a singular marketing touchpoint in the customer’s journey. This approach is similar to giving the MVP trophy to one player on a winning basketball team, despite the collective efforts of the entire team.

Advantages and Limitations of Single-Touch Models

While single-touch models offer simplicity and clarity, it's important to weigh these advantages against their limitations to fully assess their suitability for an organization's marketing strategy. Here are a few key points of each:

Advantages of Single-Touch Models

  • Simplicity: Implementing and measuring single-touch attribution is relatively straightforward, making it accessible for businesses with limited resources or technical expertise.
  • Easy to Understand: The results are clear and easily digestible, even for non-technical users.
  • Focus on Specific Channels: It can help identify the effectiveness of specific marketing channels or campaigns that directly lead to conversions.

Limitations of Single-Touch Models

  • Oversimplification of Journey: They overlook the influence of other touchpoints that contribute to the conversion, potentially leading to biased and inaccurate insights.
  • Limited Optimization: Due to its limited view of the customer journey, single-touch attribution provides limited data for optimizing the marketing mix and resource allocation.
  • Misattribution of Credit: Campaigns that nurture and support conversions may be undervalued or ignored altogether.

When to Use Single-Touch Attribution

Single-touch attribution is generally a practical choice for businesses seeking a straightforward, cost-effective way to gauge the impact of their marketing efforts, especially when dealing with simple sales processes and limited data complexity.

Here are a few specific scenarios where single-touch attribution models are best employed:

  • Limited Budget and Resources: Small businesses or those with constrained resources find single-touch attribution more manageable and cost-effective due to its simplicity.
  • Simple Customer Journeys: If the business operates with a straightforward sales model with linear and uncomplicated customer journeys, single-touch attribution can be sufficient.
  • Quick Analysis Needs: For initial, high-level analyses of marketing campaigns, single-touch attribution offers a quick way to assess channel performance.
  • Limited Marketing Channels: When a business uses only a few marketing channels, the impact of each channel can be more easily attributed through this method.
  • Short Sales Cycles: In scenarios where the sales cycle is short, and decisions are made quickly, single-touch attribution can effectively highlight the key touchpoint leading to conversion.
  • Testing and Learning: It’s useful for businesses in the early stages of marketing analytics to start with single-touch attribution, allowing for a simpler understanding before moving to more complex models.

What Are Types of Single-Touch Attribution Models?

There are two primary types of single-touch attribution models, each distinguished by the touchpoint to which they allocate credit: the first touch model, focusing on the initial interaction, and the last touch model, which assigns credit to the final touchpoint before conversion.

First Touch Attribution Model: Highlighting Awareness

First touch attribution models assign all the credit for a conversion to the customer’s initial interaction with your brand. This model deems the initial engagement—whether a display ad, digital marketing campaign, or a channel—as the sole influencer in the customer’s purchase decision.

Let’s look at the Customer Journey Example set forth above. In the first touch model, the entire credit for the sale is attributed to the initial pay-per-click ad from the paid search campaign (Touchpoint 1) – the customer’s first interaction with the brand. However, this model overlooks other touchpoints that might have nurtured the customer’s interest and contributed to the purchase.

While the first touch model offers simplicity and highlights the effectiveness of early engagement, it risks undervaluing the customer journey. As our example shows, the initial pay-per-click ad might ignite interest, but later interactions like newsletters or webinars can fuel decision-making and drive conversions. Overlooking these crucial steps paints an incomplete picture.

Last Touch Attribution Model: The Decisive Interaction

Contrary to first touch attribution models, last touch attribution models give all the credit to the final interaction before conversion. This model emphasizes the last engagement, deeming it the key influence in the customer’s decision to convert.

Let’s return to the Customer Journey Example again. In a last touch attribution model, the direct website visit (Touchpoint 4) would receive full credit for the sale as the final interaction before purchase. However, this model overlooks all previous touchpoints, which might have influenced the customer’s journey.

Many marketers prefer the last touch attribution model because it is straightforward and values the effectiveness of closing strategies. However, this example shows that focusing solely on the last touch may paint an incomplete picture by disregarding the cumulative influence of earlier interactions.

Recommended reading: First Touch vs. Last Touch Attribution Models

Exploring Specific Variations of Single Touch Models

Certain attribution model variations cater to specific, nuanced marketing objectives and scenarios. Two notable examples are the last non-direct touch attribution and lead creation attribution models. Derived from the single-touch attribution framework, these models introduce unique perspectives and a strategic depth to B2B marketing applications.

Last Non-Direct Attribution Model: Prioritizing Indirect Final Interactions

The last non-direct attribution model is a refined version of the traditional last touch model. It excludes all direct traffic, such as direct URL entry or bookmark clicks, crediting the last indirect channel before conversion. This model suggests that the final conversion decision might originate from an indirect marketing touchpoint, such as an email campaign, social media ad, or organic search.

Revisiting our Customer Journey Example illustrates this concept. In last non-direct attribution, all direct interactions, like the direct website visit (Touchpoint 4), are excluded from attribution. The focus is on the indirect touchpoints leading to conversion. Consequently, the model assigns 100% credit for the conversion to the webinar (Touchpoint 3), recognizing it as the sole conversion driver despite various channel engagements.

This example highlights the strengths and limitations of the last non-direct model. It effectively pinpoints critical conversion drivers, such as the webinar. However, it may overlook the combined influence of previous interactions, both direct and indirect, that contribute to building initial interest and influencing the customer’s decision-making.

Lead-Creation Attribution Model: Focusing on Lead Generation Impact

Lead-creation attribution models concentrate on a critical phase in the B2B sales funnel: lead generation. Unlike a single-touch attribution models, which attributes credit to the first or last interaction, this model exclusively assigns credit to the interaction that converts a prospect into a lead. This might involve a downloadable resource, a webinar sign-up, or an interaction at a trade show.

This model is especially relevant in the B2B context, where lead generation is not just a precursor to sales but a pivotal moment in the consumer journey. However, it may overlook later stages such as nurturing and conversion, possibly diminishing the focus on activities crucial for lead conversion.

What is a Multi-Touch Attribution Model?

Multi-touch attribution is a sophisticated approach in marketing analytics that acknowledges the complexity of the customer journey by attributing credit to multiple touchpoints along the path to conversion. These models enable attributing credit fairly and understanding the true drivers of conversion, which is critical for effective marketing strategies and business success.

Think of multi-touch attribution like recognizing all players’ contributions in a basketball game, rather than just awarding the MVP trophy to the last basket scorer in isolation. It differs from single-touch models by recognizing the collective influence of all the touchpoints, which is crucial in B2B marketing where purchases involve multiple stakeholders and numerous touchpoints.

Advantages and Limitations of Multi-Touch Models

While multi-touch attribution offers a more nuanced picture of campaign effectiveness, it comes with its own set of advantages and limitations. Here are a few key points of each:

Advantages of Multi-Touch Models

  • Holistic Marketing Performance View: This approach enables marketers to see how each touchpoint influences conversion, aiding in the optimization of marketing strategies and investments.
  • Data-Driven Decision Making: Marketers can allocate marketing dollars and optimize campaigns more effectively, knowing the value of each touchpoint.
  • Enhanced Customer Experience: Understanding how customers interact with a brand across multiple channels enables more personalized and efficient marketing, improving the customer journey.

Limitations of Multi-Touch Models

  • Complexity: Implementing and maintaining multi-touch attribution can be complex, requiring sophisticated tracking analytics and data integration.
  • Cost: The necessary technology and expertise can be expensive, especially for smaller businesses.
  • Model Selection: Choosing an appropriate model that aligns with your business goals and customer journey can be challenging. Different models prioritize various touchpoints, leading to varying results.

When to Use Multi-Touch Attribution

Multi-touch attribution is typically ideal for businesses seeking a nuanced understanding of how each marketing effort contributes to customer conversion, especially in environments with multiple influencing factors and touchpoints.

Here are a few specific circumstances where businesses should consider using multi-touch attribution models:

  • Complex Customer Journeys: Suitable for businesses with intricate customer paths involving multiple touchpoints before making a purchase decision.
  • Multi-Channel Marketing Strategies: When using several marketing channels, this model helps understand each channel’s impact on the final conversion.
  • In-Depth Campaign Analysis: Ideal for businesses seeking detailed insights into campaign effectiveness across various stages of the customer journey.
  • Long Sales Cycles: Particularly relevant in sectors like B2B, where purchasing decisions involve numerous interactions over extended periods.
  • Data-Driven Decision Making: Useful for companies dedicated to optimizing their marketing strategies through comprehensive data analysis.
  • Customized Marketing Efforts: Aids in tailoring marketing strategies based on insights gleaned from various customer interactions.

What Are Types of Multi-Touch Attribution Models?

Multi-touch attribution models offer varied approaches to assigning conversion credit, acknowledging the complex nature of customer interactions in the B2B journey. These models range from linear, emphasizing equal credit distribution, to more nuanced frameworks like time decay and U-shaped models, each addressing different aspects of the customer journey. This section explores the diverse options available.

Linear Attribution Model: Equitable Credit Distribution

Linear touch attribution models assign the same credit to each touchpoint in the customer journey. This approach highlights the model’s premise that every interaction contributes equally to the customer’s decision to convert, regardless of its sequence position.

Remember our Customer Journey Example, where a customer interacts with various touchpoints before converting. Under the linear attribution model, each touchpoint gets the same amount of credit (25%) for the conversion.

While this evenly distributes credit, offering a basic understanding of the overall journey, B2B customer journeys are rarely linear. This equal weighting of touchpoints offers no insights into their value to guide the marketing team on where to focus efforts or budget.

Time Decay Attribution Model: Emphasis on Recent Interactions

Time decay attribution models assign more credit to touchpoints closer to the conversion event than to earlier ones. This is based on the principle that interactions nearer to the decision point are likely more influential.

In our Customer Journey Example, under a time decay model, the direct website visit (Touchpoint 4) receives the most credit (30%) due to its proximity to the conversion. The pay-per-click ad (Touchpoint 1), the initial brand awareness driver, receives less credit (20%) due to its earlier position in the journey.

This model aligns well with a longer sales cycle, highlighting recent actions. However, they may undervalue early touchpoints critical for brand discovery and interest, potentially neglecting the journey’s foundational elements that lead to the final decision.

U-Shaped Attribution Model: Balancing Initial and Closing Impact

U-shaped, or position-based attribution models, assign more credit to the first and last touchpoints in a customer’s journey, recognizing their significant roles in initiating and concluding the conversion process. It assigns a higher percentage of credit to these two interactions. The remaining credit is distributed equally among the middle touchpoints that the customer interacted with, creating a U-shaped credit distribution.

Let’s go back to our Customer Journey Example once again. Under a U-shaped model, both the pay-per-click ad (Touchpoint 1) and the direct website visit (Touchpoint 4) receive the most credit (40% each) for their roles in initiating and closing the sale, respectively.

This model effectively emphasizes key initial and final touchpoints that drive customer engagement and sales, aiding acquisition and conversion strategies. However, position-based attribution may not fully represent the middle touchpoints’ impact on decision-making, as they only receive 20% credit collectively.

W-Shaped Attribution Model: Capturing Key Customer Milestones

The W-shaped attribution model assigns credit across a customer’s journey touchpoints, forming a W-shaped distribution when visualized. This model emphasizes three key touchpoints, with each receiving 30% of the credit:

  1. the initial touchpoint,
  2. the lead creation touchpoint, where interest in purchasing is expressed (e.g., downloading a brochure or signing up for a newsletter), and
  3. the final touchpoint before conversion.

The remaining touchpoints share the final 10% equally, reflecting their supportive role in the journey. The image above visually represents the W-shaped model’s emphasis on pivotal touchpoints, which marketers often target for improved lead generation and conversion rates.

W-shaped attribution models offer a more comprehensive view of the customer journey, from discovery to post-sale. However, their complexity can pose challenges in implementation and interpretation.

Z-Shaped Attribution Model: Integrating Key Touchpoints

The Z-shaped, or full path attribution model, extends the W-shaped model by incorporating the lead qualification touchpoint—an interaction confirming a customer’s readiness for purchase. Like the W-shaped model, it gets its name from the visual representation of credit distribution, which resembles the letter Z.

This model assigns the following four key touchpoints equal credit (22.5% each), with the other touchpoints sharing the remaining 10% equally:

  1. the initial touchpoint,
  2. the lead creation touchpoint,
  3. the lead qualification touchpoint (e.g., attending a webinar or requesting a quote), and
  4. the final touchpoint before conversion.

This full path attribution model provides a balanced approach to multi-touch attribution, ideal for businesses with defined sales cycles and multiple touchpoints contributing to conversions. However, implementing the Z-shaped model can be complex and may underrepresent certain engagements between major touchpoints, missing some subtle but impactful interactions in the customer journey.

Custom Attribution Model: Tailoring to Specific Needs

A custom attribution model is specifically designed to meet unique business needs, enabling companies to assign credit in alignment with their particular goals, customer journey patterns, and marketing strategies. This approach leverages historical data for data-driven attribution, providing a customized view of how various marketing touchpoints contribute to conversions.

This custom model is highly relevant to specific business contexts, providing insights into effective marketing activities. However, it demands significant resources to develop and can be complex to implement. Regular updates using historical data are also needed to gauge marketing ROI accurately.

What Factors Should Be Considered When Adopting an Attribution Model?

Choosing the right attribution model is crucial for businesses to identify effective marketing and advertising efforts and optimize their budgets. This decision hinges on several key factors that align with marketing strategies and goals. A thoughtful evaluation of these factors enables businesses to select a model that not only fits their current marketing environment but also adapts to evolving strategies and market conditions.

By carefully considering these aspects, companies can empower their marketing decisions, fuel business growth, and ensure the chosen model aligns with their objectives. Here are some key considerations:

Aligning Business Goals and Key Performance Indicators

The chosen attribution model should directly support the business’s objectives, providing clear insights into how marketing efforts contribute to these goals.

  • Conversions: For a primary goal of maximizing conversions, models like last touch or W-shaped are suitable, as they emphasize the final conversion drivers.
  • Brand Awareness: If the focus is on building brand awareness, a first touch or a U-shaped (position-based attribution) model might be helpful to understand initial interactions.
  • Nurturing Interactions: If understanding how various touchpoints nurture leads throughout the journey is important, a time decay model can show which interactions contribute most at different stages.

Customer Journey Complexity

The intricacy of the customer’s path to purchase is critical in deciding on an attribution model.

  • Simple Journey: If your customers typically convert after a few interactions (e.g., ad click > purchase), first touch or last touch models might work well.
  • Complex Journey: For longer, multi-touchpoint journeys (e.g., blog post > webinar > email > purchase), multi-touch models like time decay, W-shaped, or linear model are recommended to distribute credit more equitably across touchpoints.

Sales Cycle Length

The duration of the sales cycle greatly influences the choice of an attribution model.

  • Shorter Sales Cycles: Shorter sales cycles may be effectively analyzed with simpler models, such as first touch or last touch.
  • Longer Sales Cycles: In comparison, longer cycles often require the nuanced approach of multi-touch attribution models to capture extended interactions.

Customer Acquisition Channels

The marketing channels for acquiring customers can dictate the most effective attribution model.

  • Dominant Channel: If one channel (e.g., email) consistently drives most conversions, a single-touch model focused on that channel might be sufficient.
  • Multiple Channels: If you use diverse marketing channels, a multi-touch model will provide a more holistic view of their combined impact.

Data Availability and Tools

  • Limited Data: With limited user-level or customer interaction data, a simpler model may be more feasible to implement and interpret.
  • Advanced Data: With rich data sets and analytics tools, you can explore sophisticated models like data-driven custom models tailored to your specific business needs.

Technical Expertise

Assess the technical expertise needed to implement and analyze the chosen model, as some can be complex and necessitate specialized knowledge.

Conclusion: The Power of the Right Attribution Model

In today’s data-driven marketing landscape, understanding the impact of marketing on business outcomes is more crucial than ever. Single vs. multi-touch attribution models play a key role in this process. Single-touch attribution models, offering simplicity and clarity on specific channels, might not capture the full complexity of the customer journey. Conversely, multi-touch attribution models provide a more comprehensive view by accounting for the collective influence of various touchpoints.

Choosing an attribution model depends on various factors, such as business goals, customer journey complexity, and available data. A careful evaluation of these factors helps businesses select an attribution model that aligns with their current strategies and remains adaptable to future market changes and objectives.

Selecting the right attribution model is critical for optimizing marketing budgets and refining campaign effectiveness, ultimately driving business growth. This strategic choice is essential for demonstrating the impact of marketing initiatives, meeting current needs, and adapting to evolving business goals and market trends.

FAQs

Q: Can I change my attribution model once it’s implemented? A: Yes, attribution models are not set in stone. As your business and marketing strategies evolve, you may find that a different model better suits your needs. Regularly review your model’s effectiveness and be open to making changes.

Q: Why is multi-touch attribution important? A: Multi-touch attribution is important because it offers a more holistic view of the customer journey. It recognizes that multiple touchpoints contribute to a conversion, providing insights into how each interaction influences customer behavior. This understanding is crucial for optimizing marketing strategies and allocating resources effectively.

Q: Are there privacy concerns with using attribution models? A: Yes, compliance with data privacy laws like GDPR and CCPA is essential. Ensure you have consent to use customer data and that you’re transparent about how you use it in your attribution model.

Sona: Mastering Marketing Attribution for Unparalleled Growth

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Take the first step towards unlocking the full potential of your marketing campaigns. Schedule a call with us today to explore how Sona can help you gain advanced data insights and master multi-touch revenue attribution for unparalleled growth.

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