Attribution would be easy if consumers tended to click on ads and immediately make a purchase. For example, one customer clicked on our Google search ad and bought a product. Simple. That Google search campaign gets 100% of the credit for the conversion.
Unfortunately for marketers, ecommerce attribution is usually not that effortless. A customer might browse our ecommerce site because of the search ad, but several other ads will also nurture them until they're finally ready to buy. Attribution modeling tries to make the challenge of assigning credit to different ad channels and campaigns a bit easier.
Depending on the type of model you use attribution models determine what amount of credit different touchpoints in a buyer's journey get for a sale. That way, you can analyze your marketing efforts, learn what's working, then improve and refine your tactics.
There are several models to choose from. In this article, we'll take you through an overview of the different types of attribution models and give you advice about when to use which one.
The different attribution models
By using the wrong model or by not using a model at all, you could be underestimating or overestimating the role that each different marketing channel plays in your sales process. That's why it's so important to understand the different attribution models available and use the one that's best suited for your business. Here's an overview of the different models.
1. First touch
First touch attribution model gives all the credit to the first touchpoint in a customer's journey. This means that any and all credit for the sale goes to the first ad that the customer interacted with, regardless of whether or not it was the ad that actually convinced them to make a purchase. This model is often used by ecommerce businesses that want to track the effectiveness of their initial marketing efforts.
2. Last touch
Last touch or last click attribution model is the default attribution model in Google Analytics. It assigns 100% of the credit for the sale to the most recent ad that the customer interacted with. This means that the last ad the customer saw before making a purchase is given all the credit for convincing them to buy. This model is often used by ecommerce businesses that want to track the effectiveness of their conversion-focused marketing efforts.
Read more: Last Click Attribution Explained
3. Time decay
Time decay attribution model credits touchpoints that occurred closest to the purchase. The earlier an ad happens in the customer's journey, the less credit it gets. For example, if a customer interacted with several ads before making a purchase, the ads that happened in the middle of their journey get less credit than those that happened closer to the end. This model is often used by ecommerce businesses that have a long and complex buyer's journey.
A linear attribution model assigns equal credit to all touchpoints in a customer's journey. This means that each and every touchpoint is given an equal share of the credit for the sale. This model is often used by ecommerce businesses that want to track the effectiveness of their marketing efforts evenly.
5. U-shaped (AKA position-based)
The U-shaped attribution model (sometimes called the position based model) assigns more credit for a conversion to the first and final touchpoints, and less credit to the touchpoints in the middle of the customer's journey. The first and last points both get 40% each, and the remaining 20% is divided equally across the remaining touch points.
This model is often used by ecommerce businesses that want to track the effectiveness of their initial marketing efforts and their conversion-focused marketing efforts without ignoring the touchpoints in the middle.
6. Data driven
In data-driven attribution, the model assigns credit for a sale to the touchpoints in a customer's journey based on data analysis. Data-driven models usually deploy machine learning technology to determine the amount of credit to give to each touchpoint. This allows businesses to more accurately track the effectiveness of their marketing efforts.
What's the best attribution model for ecommerce?
There is no one perfect marketing attribution model. The best model for your business depends on your business goals and the nature of your sales funnel. You should also use different models depending on what you want to measure.
To find out which ads are driving new traffic, use first touch attribution.
First touch attribution is useful for ecommerce businesses because it allows them to track which ads are driving new traffic. By using this model, businesses can determine which ads are most effective at bringing in new customers and adjust their marketing efforts to reproduce the success of those ads. That means this model is best if you're focused on building brand awareness and demand generation.
To find out which ads are converting people, use a last touch or time decay model.
Last touch and time decay ecommerce attribution models can be useful for ecommerce businesses that want to track the effectiveness of their conversion-focused marketing efforts. These models give more credit to touchpoints closest to a sale. So, by using these models, businesses can gain valuable insights into which types of ads are most effective at convincing customers to make a purchase and optimize their marketing strategies accordingly.
To get an overview of your marketing efforts, you have a few options...
U-shaped ecommerce attribution and linear ecommerce attribution are both useful for ecommerce businesses that want to gain a more holistic view of their marketing efforts. These models allow businesses to track the performance of all touchpoints in the customer journey, giving them valuable insights into which parts of their marketing strategy are working well and which could use some improvement. The difference is the U-shaped model treats the initial and final touch points as more valuable.
Although data-driven ecommerce attribution models are more accurate than other models, they can be expensive to implement and maintain. This is because they require a lot of data processing, which can be difficult and time-consuming. However, if you're using Google Ads, you can use the built-in data-driven ecommerce attribution model in Google Analytics to get accurate insights into your marketing efforts.
The Google Ads data-driven ecommerce attribution model uses all of the data that's available to Google Ads, including transaction data, conversion data, and impression and click data. This allows businesses to understand how different touchpoints are impacting their sales and make more informed decisions about their marketing strategy. On the other hand, if you're running ads outside of Google (for example, with Meta or Amazon), this external data won't be tracked.
There are a few factors to consider when choosing an ecommerce attribution model:
Business goals. What does your business want to achieve with its marketing efforts? Different ecommerce attribution models are better suited for different purposes.
Customer journey. How does your customer journey work? Which parts of the journey are you most interested in measuring?
The number of channels. If you have few marketing channels, it will be easy for you to use a simple single-touch attribution model. However, if your customer journey is more complex and involves more channels, you might want to use a more complex multi-touch model.
Data availability. What data is available to you? Which ecommerce attribution model is best suited to track the data you have access to?
Cost. Implementing and maintaining a data-driven ecommerce attribution model can be expensive. Consider whether the benefits of using this type of model outweigh the costs.
Ultimately, the best ecommerce attribution model for your business will depend on your unique needs and goals. To find the right ecommerce attribution model for you, it is important to carefully analyze your marketing efforts, track your conversions closely, and experiment with different models until you find one that matches your sales funnel best.
Once you've found the right ecommerce attribution model for your online business and have access to attribution data, it's time to focus on using that information to optimize your marketing strategy and make the most of your marketing budget. Data on which channels and campaigns are working well - or not working at all - is all useful. It allows you to adjust, iterate, and improve your tactics.
The goal is to get all parts of your marketing strategy – organic search, email orSMS marketing, and paid ads – working as efficiently as possible. But without the right data, you won't be able to identify where you need to take action. Readour guide to ecommerce analytics to learn more about the metrics you should be tracking.