The Simple Answer to Solving the Attribution Equation
In the digital world we live in today, the average shopper uses at least three devices to access the internet. Across those devices, consumers encounter numerous types of engagement from retailers — promotional text messages, email offers, product ads, etc. The path to purchase has become so complicated that it's almost impossible to determine which touchpoint triggers a customer's purchase. As a result, attribution is an increasingly challenging feat for retailers, and many are relying on old-school models that simply aren't effective for omnichannel shoppers.
Why 'Last Click' Should Be a Last Resort
The "last click" method, where retailers attribute a sale to a customer's last engagement before purchase, is still one of the most prevalent attribution models. Though this approach simplifies things, it fails to recognize the "path" and the influence that each stage along that path has. As all of us know from our own experiences as a consumer that there are many interactions that happen along the way that influence a purchasing decision.
Let's say a person is in the market for a new pair of boots. Before actually purchasing the boots, she searched for them on a store's website, responded to a promotional email, returned to the store's website after seeing a display advertisement and received a promotional SMS message. Right before she buys the boots, however, she decides to take a shortcut and just types "brown UGG boots" into Google's search bar. If she buys them then, Google gets the credit for the sale.
When you look back at this woman's path to purchase, you can see that several factors helped solidify her purchase. This goes to show that a customer's last click (in this case, the Google search bar) isn't always the primary driver of a purchase.
Proportional Credit Means Multiple Payments
Recognizing the shortcomings of the last click model, some retailers rely on proportional credit, which uses an algorithm to give partial credit to all of a customer's interactions before purchase. In the case of the boot example from above, the retailer would give partial credit to its website, email program, display ad, SMS message and Google's search bar. Proportional credit is certainly more representative — and fair — but retailers are still forced to pay multiple vendors, which is complicated and, in most cases, more costly.
Less is More for Attribution
The most cost-effective way to solve the attribution dilemma is to rationalize the number of vendors you use. The idea of using one vendor for everything is clearly utopian, but retailers can work with a smaller set of vendors to consolidate the myriad of touchpoints. Retailers should look for vendors that cover the entire customer life cycle, from new customer acquisition to conversion and reactivation, to facilitate a more simplified model.
Using one vendor for multiple channels is the modern solution to attribution. When you minimize your vendor partners and consolidate interactions across multiple touchpoints, you can simplify the complicated attribution process and achieve significant cost savings.
Chip Overstreet is senior vice president, marketing, business and corporate development at MyBuys, a provider of coordinated, cross-channel personalization services for display ads, email and websites.