The session 6 talked about the measurement of e-marketing, which intrigues me a lot. Since what I have learnt is more about qualitative analysis and strategy in the early phase, instead of the implementation and measurement in the later phase.
An article I find interesting focuses on the marketing metrics for channel attribution process. http://sherpablog.marketingsherpa.com/research-and-measurement/analytics-capturing-why-customers-buy/ Based on the different contribution rates of various media channels, you could attribute the limited marketing budgets to its best. The attribution models are the tools that could help you evaluate the effectiveness of channels. Below are some common models (from Google Analytics https://support.google.com/analytics/answer/1665189?hl=en):
- The Last Interaction model
The Last Interaction model attributes 100% of the conversion value to the last channel with which the customer interacted before buying or converting.
When it’s useful: If your ads and campaigns are designed to attract people at the moment of purchase, or your business is primarily transactional with a sales cycle that does not involve a consideration phase, the Last Interaction model may be appropriate.
- The Last Non-Direct Click model
The Last Non-Direct Click model ignores direct visits and attributes 100% of the conversion value to the last channel that the customer clicked through from before buying or converting. Google Analytics uses this model by default when attributing conversion value in non-Multi-Channel Funnels reports.
When it’s useful: Because the Last Non-Direct Click model is the default model used for non-Multi-Channel Funnels reports, it provides a useful benchmark to compare with results from other models.
In addition, if you consider direct visits to be from customers who have already been won through a different channel, then you may wish to filter out direct visits and focus on the last marketing activity before conversion.
- The Last AdWords Click model
The Last AdWords Click model attributes 100% of the conversion value to the most recent AdWords ad that the customer clicked before buying or converting.
When it’s useful: If you want to identify and credit the AdWords ads that closed the most conversions, use the Last AdWords Click model.
- The First Interaction model
The First Interaction model attributes 100% of the conversion value to the first channel with which the customer interacted.
When it’s useful: This model is appropriate if you run ads or campaigns to create initial awareness. For example, if your brand is not well known, you may place a premium on the keywords or channels that first exposed customers to the brand.
- The Linear model
The Linear model gives equal credit to each channel interaction on the way to conversion.
When it’s useful: This model is useful if your campaigns are designed to maintain contact and awareness with the customer throughout the entire sales cycle. In this case, each touchpoint is equally important during the consideration process.
- The Time Decay model
If the sales cycle involves only a short consideration phase, the Time Decay model may be appropriate. This model most heavily credits the touchpoints that occurred nearest to the time of conversion.
When it’s useful: If you run one-day or two-day promotion campaigns, you may wish to give more credit to interactions during the days of the promotion. In this case, interactions that occurred one week before have only a small value as compared to touchpoints near the conversion. The Time Decay model allows you to appropriately credit touchpoints during the day or two leading up to conversion.
- The Position Based model
The Position Based model allows you to create a hybrid of the Last Interaction and First Interaction models. Instead of giving all the credit to either the first or last interaction, you can split the credit between them. One common scenario is to assign 40% credit each to the first interaction and last interaction, and assign 20% credit to the interactions in the middle.
When it’s useful: If you most value touchpoints that introduced customers to your brand and final touchpoints that resulted in sales, use the Position Based model.
However, easier said than done. The real-life situation can be more complicated.
Imagine this. Tim first interacted with my brand when his friend shared a product review on Facebook. Then he visited my Facebook page to dig more, and left. Weeks later, Tim saw my new product on the Facebook page and was quite interested. He opened the Google.com to compare similar products and a PPC ad appeared to convince his choice. Later he decided to search for some promotion code so that he could get a good bargain. Finally, he used the code from an affiliate and completed the transaction on my website.
Many marketers looking at this process will attribute the sale to the natural search and/or affiliate channel, since the customer found the brand in natural search and converted through an affiliate promotion. Moreover, the models above rely on Web cookies, which cause underrepresentation on social media and other mediums that are frequently accessed from mobile apps and offline channels. Therefore, while some channels didn’t result the channels directly, they are indispensable distributors of the sale.
In the next post, we’ll handle the issue in more details.