Ad Attribution: The Definitive Guide

Overview

What ad attribution is and best practices for measuring it.

Ad attribution dominates retail media attention as demonstrating return on investment (ROI) is critical to attracting and retaining advertisers. In fact, a QueryClick survey found that 98% of respondents cite attribution as an important part of their tech stack. Clear ad attribution, equipped with first-party data and customer journey insights, is one of the best ways retailers can demonstrate ROI.

RMNs must effectively report attribution if they want to surpass other advertising channels moving forward.

What Is Ad Attribution?

Ad attribution is the process of determining which user actions led to a desired outcome, like a sale or conversion, from an initial user ad click to the final conversion. ClearCode defines attribution as “ ...the process of identifying which touchpoints a consumer interacted with or was exposed to during a period of time before they completed a goal set by an advertiser or marketer.”

Simply put, attribution is the mechanism of figuring out what customer actions led to a conversion. When a retailer reports that a user’s click on an ad led to a purchase, advertisers and marketers can better determine which ads and tactics contribute to sales or other goals. This way, they can improve and iterate on their campaigns since they understand which touchpoints are most effective and identify which parts of their marketing strategy drive results.

Important Terms

• Customer journey. According to ClearCode, a customer journey is the path from initial brand awareness to the completion of a goal (e.g. a purchase or download).

• Touchpoint. A touchpoint is any interaction a user has with a brand during their customer journey, including both active engagements (like clicks) and passive ones (like viewing an ad).

When researching attribution, you may encounter the term “incrementality.” However, attribution focuses on short-term measurement, while incrementality covers mid-term measurement. For more information on incrementality, see our guide here ( see section “Incrementality vs. Attribution.”)

Why Attribution Matters

Attribution provides advertisers the insights necessary to optimize campaigns and maximize ROI by accurately crediting specific touchpoints. This data-driven approach eliminates guesswork and identifies the most effective content or strategies to drive results and improve performance.

Benefits of Ad Attribution

• Easier planning. Learn from past campaigns for better future strategies.
• Improved reporting. Generates detailed, data-backed reports.
• Customer journey insights. Understand the role of multiple touchpoints in conversions.
• Cost-effective. Reallocate resources away from underperforming campaigns.
• Reach customers sooner. Influence customers earlier on their purchase cycle.
• Optimize bidding. Refine bidding strategies based on ad performance.
• Focus on revenue. Prioritize actions driving sales rather than vanity metrics.

Overall, ad attribution is indispensable for understanding the customer journey and making informed decisions to drive success.

Attribution In Advertising: 9 Types Of Attribution Modeling

1. Last-Click Attribution

• Definition: Gives 100% of credit to the last known interaction before the conversion.
• Pros: Easy to implement; Good for analyzing final touchpoints.
• Cons: Oversimplified and ignores other influential touchpoints.
• Best for: Businesses with shorter sales cycles.

2. First-Click Attribution

• Definition: Assigns all credit for a conversion to the first interaction.
• Pros: Easy to implement; Useful for tracking initial discovery.
• Cons: Ignores subsequent touchpoints.
• Best for: Advertising limited to two channels.

3. Linear Attribution

• Definition: Distributes credit evenly across all touchpoints.
• Pros: Comprehensive overview of customer journey.
• Cons: Treats all touchpoints equally, neglecting their real impact.
• Best for: Long-term marketing measurement.

4. Lead-Conversion Touch Attribution

• Definition: Assigns credit based on perceived impacts of touchpoints on conversions.
• Pros: Pinpoints moments of lead generation.
• Cons: Requires resources and may misallocate credit weight.
• Best for: Channels performing well for specific brand goals.

5. Time Decay Attribution

• Definition: Gives more credit to touchpoints closer in time to the conversion.
• Pros: Reflects real-world influence on conversions.
• Cons: May misallocate credit to later touchpoints.
• Best for: Businesses with longer sales cycles.

6. Position-Based Attribution

• Definition: Assigns 40% credit to first and last interactions, 20% to the rest.
• Pros: Tracks every touchpoint for a fuller view of the customer journey.
• Cons: Time-inefficient and may over-credit middle touchpoints.
• Best for: Businesses relying on repeat purchases.

7. W-Shaped Attribution

• Definition: Assigns varying credit (30%, 30%, and 30% for key moments) to significant touchpoints.
• Pros: Comprehensive view of the customer journey.
• Cons: Over-prioritizes certain events.
• Best for: Long sales cycles with multiple decision-makers.

8. Z-Shaped Attribution

• Definition: Distributes credit equally across four key stages of the customer journey.
• Pros: Accounts for every interaction prior to conversion.
• Cons: May inaccurately allocate credit.
• Best for: Large businesses with complex sales cycles.

9. Custom Attribution

• Definition: Allows customization of credit rules based on campaign characteristics.
• Pros: Highly accurate and tailored.
• Cons: Complex to set up and requires expertise.
• Best for: Businesses with resources to develop sophisticated models.

Choosing An Attribution Model

Factors to consider:

• Length of sales cycle.
• Customer journey distribution.
• Campaign objectives.
• Business type.
• Number of marketing channels.
• Sales team interactions.

How To Integrate Ad Attribution

Best practices include:

• Take an omnichannel approach.
• Investigate diverse leads.
• Consider CRM data for optimizing customer activities.
• Employ automation for accuracy and efficiency.

Build Vs. Buy

Considerations:

1. Blackbox Partners - Offers tool-based analytics but may lead to data fragmentation.
2. Building From Scratch - Tailored but resource-intensive requiring thorough data analytics.
3. Ad Attribution With Kevel - Combines convenience with personalization for robust results.

For further details, consider Kevel for sophisticated attribution solutions.