Single vs. Multi-Touch Attribution Models

The Team at Sona

Businesses can access multiple marketing channels to reach their target customers. With a multi-channel marketing strategy, it becomes more complex for companies to determine which marketing channels provide value and return on investment. The customer journey is not a straightforward process since it can involve multiple stages and interactions with different marketing channels.

Customers, especially in B2B, typically interact with multiple touchpoints before they finally make a purchase. For example, suppose a customer finds out about your product on Instagram and likes it. Next, they browse your site to learn more about your products. Then, they click on the website link provided on the page, browse through your catalog and sign up for the newsletter. 

Finally, after a couple of months, they get a newsletter in their email informing them about a sale on the product they liked. This email finally convinces them to purchase the product. So, they click on the email, follow the link, and make the purchase on the website.

In this case, you might wonder, “Which marketing channel influenced the customer to purchase?” What role did Instagram play in the conversion process?” or “Did any other marketing channel play a role in the customer conversion?” Answering these questions is where marketing attribution comes into the picture. 

Marketing attribution helps businesses understand which marketing activities led to sales and revenue. Accurate marketing attribution requires people, processes, and technology to come together.

What Is Attribution Modeling?

Attribution modeling determines how credit for sales and marketing touchpoints gets distributed to different marketing channels and activities in the customer journey. Attribution modeling provides insight into which marketing channels are most effective in driving customer acquisition and revenue.

It shows which marketing activities drive results and how much credit all the touchpoints should receive. With attribution modeling, businesses make better-informed marketing investments and derive high ROI on their marketing and advertising efforts.

What Are Attribution Models?

Attribution modeling is the process of assigning credit to the actual and synthetic touchpoints in the customer journey. Attribution models are rules that determine how credit for marketing touches, milestone events, and conversions get assigned to buyer conversion paths.

Businesses can use different attribution models to assign credit to various touchpoints in the customer journey. Companies can use any attribution model depending upon several factors, such as the aim of attribution modeling, the final goal, and the complexity of the sales process and customer journey.

Here is a look at the different types of attribution models. 

What Are the Different Types of Attribution Models?

There's no one-size-fits-all answer for attribution models - each business has to consider the insights of different attribution models. That said, specific attribution models inform what marketing channels sourced leads compared to other attribution models that provide insights into what progressed the lead to a sale. With the correct data assembled, a range of attribution models available can help determine the amount of credit to different touchpoints in the customer journey. These models include single and multi-touch attribution, rules, and AI-based models. Businesses can also use custom attribution models based on their needs.

Attribution models broadly fall into two categories. Primarily, they are categorized based on the number of touchpoints they assign credit to a sale in the customer journey. These include:

  • single-touch attribution models
  • multi-touch attribution models

The single-touch and multi-touch attribution models can break down into different models based on the rules they use to assign credits to other touchpoints. Let’s take a look at each in detail.

What Is a single-touch Attribution Model?

A single-touch attribution model is a marketing attribution model that assigns credit for a conversion to a single-touchpoint in the conversion path. In a first touch attribution model, the credit for a conversion is given to the digital marketing campaign, channel, or display ad that initially sourced the user to the website. 

The first touch attribution model can be valuable and informative for businesses that solely want to track which marketing initiatives are driving initial interest. Still, it can also lead to oversimplification since it doesn't consider the role of other touchpoints in the conversion path. While single-touch attribution models can help understand the relative impact of different channels, they do not provide a partial picture of marketing performance. By combining single-touch attribution models with other types of attribution analysis, businesses can get a complete picture of how their marketing efforts are performing.

What are the Different Types of single-touch Attribution Models?

Single-touch attribution models are categorized based on the touchpoint to which they assign sales credit. They include:

First Touch Attribution Model

The first touch attribution model attributes conversion credit to the very first touchpoint that a customer has with your brand. For example, if someone clicks on an ad and then later purchases a product from your website, the sale would be attributed to the ad. 

While this model is simple and easy to understand, it can sometimes give an inaccurate picture of the customer journey. In particular, it doesn't consider any subsequent interactions the customer has with your brand. 

As a result, it's essential to use the first touch attribution model in conjunction with other attribution models to understand how customers interact with your brand online.

When to Ideally Use the First Touch Attribution Model?

First touch attribution models are best-suited for businesses who want to get information about marketing channels that bring in new customers.

Last Touch Attribution Model

The last touch attribution model is a marketing tool that assigns all the credit for a conversion to the last ad or the channel a customer interacted with before converting. For example, if a customer sees an ad on Facebook, clicks on it, and then purchases a product from the company's website, the last touch attribution model would give credit for the conversion to Facebook. 

This type of attribution model, like the first touch model, is often used by marketers because it is simple to understand and measure. However, there are some drawbacks to using the last touch attribution model. 

It does not consider the customer's interactions with the company before converting. For example, if the customer had seen a TV ad for the company before seeing the Facebook ad, the TV ad would not receive credit for the conversion. 

As a result, the last touch attribution model can be misleading and may not provide an accurate picture of how different marketing channels contribute to conversions. A complete understanding of the customer journey requires an analysis of the last touch model and other attribution models.

When to Ideally Use the Last Touch Attribution Model?

The last touch attribution model helps businesses understand the marketing channels influencing a sale. In B2B, there are several stages, and it is essential to measure marketing influence as leads progress to deals. 

Last Non-Direct Touch Attribution Model

The last non-direct touch attribution model is a media attribution model that credits the last interaction before conversion, excluding direct touch interactions. Marketers often use this model to attribute conversions to specific marketing channels, such as display advertising or email marketing. 

The last non-direct touch attribution model simplifies analysis and visualization related to how marketing channels rank in terms of performance.

Similar to the last touch model, the last non-direct touch attribution model should, along with other attribution models, provide a better understanding of the customer journey.

When to Ideally Use the Last Non-direct Touch Attribution Model?

For B2B, the last non-direct touch attribution model is helpful for businesses who want to rank which marketing activities advance an opportunity into a sale.

Lead Creation Attribution Model

​​The lead creation attribution model assigns 100% credit to the touchpoint when a prospect becomes a qualified lead. Businesses can determine which marketing activities are most effective at generating new leads. By tracking the conversion rate of leads to qualified leads across different marketing channels, companies can see which channels drive the most conversions. 

When to Ideally Use the Lead Creation Attribution Model?

The lead creation attribution model should be used to analyze lead source metrics. Businesses that want to rank the share of qualified leads by marketing channel should consider this model.

The Shortcomings of the single-touch Models

We can see that single-touch attribution models are highly limited as they assign credit to only a single-touchpoint in the customer journey. Thus, marketers that want greater visibility prefer to use multi-touch attribution models as they give a more complete and detailed understanding of all touchpoints in the customer journey.

What Is a multi-touch Attribution Model?

A multi-touch attribution model assigns credit to multiple marketing channels across the customer’s journey to conversion. The benefits include measuring the impact of online and offline marketing efforts and understanding how different touchpoints interact with each other. 

There are various multi-touch attribution models, but they all have one thing in common: they aim to provide a more holistic view of the customer journey. By understanding which touchpoints are most important at each journey stage, businesses can optimize their marketing dollars for more significant ROI. 

Like single-touch attribution models, multi-touch attribution models get classified into different types based on how they assign credit to varying touchpoints in the customer journey. Here is a look at the classification of multi-touch attribution models.

What Are the Different Types of multi-touch Attribution Models?

The different types of multi-touch attribution models include:

Linear Attribution Model

The linear attribution model assigns credit to all the touchpoints throughout the customer’s journey. It gives the same amount or equal credit to all the marketing touchpoints that the customer interacted with in the sales cycle.

For example, if the customer journey involves four marketing touchpoints, the same 25% credit will get assigned to all the touchpoints with the linear attribution model. Similarly, if there is only one marketing touchpoint, all the credit gets assigned to the single touchpoint in the linear model.

When to Ideally Use a Linear Attribution Model?

The linear attribution model is best-suited for businesses who want to start using multi-touch attribution modeling as it provides a macro-level understanding of marketing channel impact and does not require deep data science capabilities. 

Time Decay Attribution Model

The time decay model is similar to the linear model. It also assigns credit to all the touchpoints in the sales cycle. However, the difference with the time decay multi-channel attribution model is that it gives more credit to the touchpoints closer to the conversion event. The credit reduces gradually as we move further back in the time of the purchase.

For instance, the last lead conversion touchpoint will get the maximum credit; the second-last touchpoint will get a lesser credit; the touchpoint before that even less credit, and so on. With the time decay model, the first touchpoint receives the least amount of credit.

When to Ideally Use a Time Decay Attribution Model?

The time decay attribution model best suits businesses with longer sales cycles. It helps understand the channels that pull out the customers from the early nurture phase and which channels encourage them to make a purchase.

U-Shaped Attribution Model

The U-shaped model, also known as the position-based attribution model, assigns more credit to the first and last touchpoints (40% each). The remaining 20% gets distributed among the remaining touchpoints encountered in the middle of the customer journey.

When to Ideally Use a U-Shaped Attribution Model?

Businesses should consider the U-Shaped marketing attribution model when there’s a need to focus on channels that first attract the customers to the company and the channels that lead to the most sales (the entry and exit points in the customer path).

W-Shaped Attribution Model

A W-shaped attribution model assigns equal credit to the first, last, and lead-creation touchpoints. It gives each of the touchpoints 30% credit. The remaining 10% gets distributed among the remaining touchpoints.

When to Ideally Use a W-Shaped Attribution Model?

A W-shaped attribution model is best suited for holistic marketing attribution. It gives businesses detailed information about which channels source customers (first touchpoint), the channels that influence the sale (last touchpoint), and the mid-funnel channels that progress a lead to an opportunity or a sale.

Z-shaped Attribution Model

The Z-shaped attribution model also referred to as the full path attribution model is a position-based attribution model that assigns 22.5% of the credit to the four key pipeline stages and their accompanying touchpoints in the customer journey. The remaining 10% of the credit is split equally amongst the rest of the touchpoints.

When to Ideally Use a Z-shaped Attribution Model?

Businesses with a complex and lengthy sales cycle should ideally consider the Z-shaped attribution model. The model helps to provide detailed insights about the four most essential pipeline stages for B2B - first touch, lead creation, qualified lead, and last touch points in a customer journey. 

Custom Attribution Model

Custom attribution models allow businesses to attribute custom credit for conversions, key milestone events, and marketing touchpoints that influence the customer journey. Custom attribution models can be data-driven or rules-based. Data-driven attribution models assign custom credit to marketing touchpoints on a conversion path based on how adding each touchpoint to the conversion path impacts the estimated conversion probability. In contrast, rules-based custom attribution models have a fixed definition of how much credit a milestone, conversion, or touchpoint should receive.

A custom data-driven attribution model considers various pre-defined factors (historical data), including the timing, intensity, and recency of exposure to each touchpoint, before assigning credit to different touchpoints throughout the customer’s journey. A custom attribution model can assign credit to one or more touchpoints based on historical data and the custom rules set.

When to Ideally Use a Custom Attribution Model?

A custom attribution model can be effective when you have specific goals. You can tailor the model as per your needs. For instance, a business can use a custom model to determine how much credit a paid search touchpoint should receive.

Multi-touch attribution tools give businesses a more accurate picture of which marketing activities drive results. While custom models can be complex to set up and sometimes require updating, they can offer a significant advantage in understanding your marketing efforts' true ROI.

Why Is multi-touch Attribution Important?

Multi-touch attribution models provide advanced data insights and credit multiple points of interaction that help businesses fine-tune their marketing strategies. With longer sales cycles, this helps businesses fine-tune their marketing strategies, improve their marketing ROI, and to unlock revenue growth. Additionally, the insights delivered from multi-touch attribution can also help to accelerate the sales cycle since marketing channels will vary from the first interaction to the sale. 

While multi-touch attribution models are generally better than single-touch ones, that doesn't mean you should immediately switch to a multi-touch attribution strategy. Marketers must weigh the benefits and the complexities associated with multi-touch attribution before making such an investment. 

How to Determine the Right Attribution Strategy For Your Business?

Earlier, we briefly discussed when to leverage different attribution strategies. However, selecting an attribution strategy raises several questions. At the outset, there is the build vs. buy decision, the goals behind implementing a single-touch vs multi-touch attribution strategy, exec and board-level considerations, cost, time to market, and more. Accurately attributing revenue to marketing activities is critical for high-performing organizations. Without the right partner, tackling revenue attribution can be time-consuming and overwhelming. Revenue attribution platforms help to automate these processes so you can make informed marketing decisions and generate more reliable forecasts with minimal effort.

Some of the critical aspects businesses need to consider before deciding on an attribution strategy include:

Sales Cycle

Each business has a different sales cycle depending on its products and services. The sales cycle can be either long or short. For example, the B2B sales cycle tends to be longer. In contrast, the direct-to-consumer sales cycle tends to be shorter.

The sales cycle plays a vital role in choosing an appropriate attribution strategy. For instance, businesses with a shorter sales cycle are more likely to find the single-touch attribution model more useful as they can get detailed insights about the first touchpoint from the lead source. They can then focus on investing in and optimizing lead sources with an optimal sales cycle.

Similarly, businesses with longer sales cycles prefer a multi-touch attribution model as it helps provide detailed insights throughout the customer journey. Companies can then adjust their marketing spending accordingly.

Business Goals for Single vs Multi-Touch Attribution

Another factor that plays a significant role in determining the attribution strategy relates to business goals. For instance, a single-touch attribution model might be adequate for a business that wants to understand how customers discover the company and the related customer acquisition costs (CAC). In such a case, a first-touch attribution strategy can suffice.

Next, let’s suppose that a business wants to get deeper insights into how different marketing campaigns interact and how each campaign advances the customer through the sales funnel. In this case, a multi-touch attribution strategy will collect and assemble the data to provide insights into how different marketing channels and campaigns progress the prospect through the sales funnel.

Data Science Capabilities

Advanced attribution modeling requires experienced professionals in the data science domain. They can fine-tune and assign the appropriate credit to the different touchpoints in an attribution model. 

Thus, if a business has an in-house data science team, custom multi-touch attribution models are possible. Typically, this will require infrastructure such as a data warehouse, data engineers to manipulate data, and data scientists to design custom attribution models. if a business doesn’t currently have data science capabilities, this can be a risky path given the complexity and multiple organizational functions that would be involved.

The Offline Touchpoint Dilemma

Most single and multi-channel attribution strategies are reasonable at extracting detailed insights into online marketing touchpoints. This alone can significantly help businesses maximize their digital marketing and advertising ROI.

However, attribution solutions often consider just online customer interaction data and are missing valuable data from offline marketing. With missing data from offline marketing, attribution models will be less accurate for marketing decisions.

For example, suppose a customer learned about your brand through a paid search ad and a direct mail postcard with a discount code for in-store purchases. That prompted the prospect to visit your retail store and physically check the product. The prospect completes the purchase at the store given the discount code. In this case, the paid search ad, direct mail postcard, and store visit all convinced the customer to buy the product.

Merging Online and Offline User Level Data From Marketing Channels

Thus, to get the best results with attribution modeling, businesses need to find a way to blend online and offline touchpoints to get access to customer data on a granular level. This enhanced data, in turn, will help with accurate attribution modeling and to craft enhanced marketing strategies, both online and offline, to attract more customers and improve sales.

Merging online and offline touchpoints can turn out to be a daunting and tricky task. However, ignoring it can limit visibility and provide misleading information about the customer journey.

Businesses can implement specific attribution strategies to enhance visibility and better understand the customer journey. 

Improving Online and Offline Customer Data Collection

Businesses can enhance user data collection to improve attribution modeling with various methods. These may include:

Carrying out Surveys

One way to find out more about how your online marketing campaigns influence your customers is by conducting post-purchase surveys. You can ask your customers how they first heard about your business. The implementation of self-attribution surveys will have a big impact on data insights derived. Text input vs multiple choice fields in surveys can make a notable difference in the quality of attribution data collected. The right attribution partner can provide guidance and insights into the different options and their tradeoffs.

Other Methods

Businesses can use other methods, such as call tracking, to improve customer data and enhance attribution modeling.

Conclusion

Attribution strategy helps businesses understand how marketing activities are attracting customers and which marketing activities influence prospects to make a purchase. Multi-touch attribution models are becoming an increasingly important tool for businesses to understand how their customers interact with their brand and which marketing channels are most effective in driving ROI. 

For businesses with multiple online marketing channels or offline marketing channels, multi-touch attribution can enhance the accuracy and efficacy of marketing decisions. Rules-based vs data-driven attribution models serve different purposes for marketers. The insights delivered from multi-touch attribution can help businesses accelerate sales cycles by understanding which marketing activities have the most significant ROI

However, implementing a multi-touch attribution model isn't without its challenges, so marketers need to weigh the benefits and complexities associated with this type of endeavor before deciding if it's the right strategy for their business.

Don’t know where to start?

We specialize in multi-touch revenue attribution and marketing data unification at Sona Labs. Additionally, we help companies collect first-party data, aggregate it in a unified warehouse, and streamline their data for analysis. Our synchronization capabilities can update ad platforms, data warehouses, and go-to-market tools such as Salesforce as often as you need. Schedule a call to learn how you can gain advanced data insights and understand how to unlock revenue growth with better attribution. 

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