Marketing attribution has Doug feeling a little salty today. He and Jess dig into whether or not marketing attribution is a waste of time.
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- [RevOps Show] Episode 26: What (Almost) Everyone is Getting Wrong with Data & Metrics
Congratulations Jess on 7 years with Lift! 🎉 We appreciate you and all the hard work you’ve done for the company. Cheers to many more years to come.
The topic discussed in this episode has Doug a little salty. Is marketing attribution a waste of time?
If it were that simple, Doug’s answer would be “Yes” and the episode would be over, but he can’t get out of the episode that easy.
What is marketing attribution?
According to HubSpot, marketing attribution is a reporting strategy that allows marketers and sales teams to see the impact that marketers made on a specific goal, approach, or sale.
Other places (Marketing Evolution) identify it as, the analytical science of determining which marketing tactics are contributing to sales or conversations (short version). The longer version says, the practice of evaluating the marketing touch points a consumer encounters on their path to purchase. The goal of attribution is determined which channels and messages have the greatest impact on the decision to convert or take the desired next step. There are several popular attribution models.
According to Wikipedia marketing attribution, also known as multi-touch attribution is the identification of a set of user actions that contribute to a desired outcome and then the assignment of a value to each of those events.
That’s a lot of defining. Doug loves the intent of marketing attribution, but hates its application. Its a wonderful idea to know if someone pushes a button what will come from it, but is the juice worth the squeeze? Usually people take a methodology here that works in a very specific situation and try to apply it to a much broader, more complex situation. Marketing attribution ends up being implemented as though we’re using it to manage the business, but you can’t manage your future by looking in the rear-view mirror. There may be truth to an attribution report, but what good is it doing? These reports can help to guide you on what to do moving forward, but that sould feed into a hypothesis rather than directly drive decisions as if it was an absolute answer.
This goes back to a data metrics conversation that happened in a prior episode. If you’re using the data to prompt questions and to generate hypotheses that you’re testing, then it’s valuable. But when you’re using it to answer questions things don’t work that way.
Where does attribution marketing work?
If you’re Amazon and are managing a storefront it’s really important. If you have a very linear path to a sale it’s important.
Why do people think marketing attribution is important? What is the promise of marketing attribution?
It’s a great promise to know what works and what doesn’t work. The fundamental flaw is that it’s costing companies billions of dollars. Doug believes marketing attribution is being applied and managed in a negative way.
Marketing attribution became popular to marketers especially when times were tough because they could prove that what they were doing was important to the CEO.
The reason that this costs money is because:
- We’re defining everything by the past.
- We’re pushing everything into this idea of a linear dark funnel (coined by Chris Walker)
Here’s an example of what will show no attribution in our marketing game - this podcast episode. We cannot attribute our podcasts to any of our revenue and Doug has been podcasting for YEARS. Does he think for a second it hasn’t contributed? No because otherwise he would’ve stopped a long time ago.
On one of our last episodes of The Blackline Podcast we had on guest Jay Acunzo. He posed the question, “do think someone opening or clicking on your email is actually contributing to taking action? What would you rather have - 10 clicks or 2 responses?”
The real reason marketing attribution exists is to cover your ass. As a marketer, you feel like you have to show your value and to do that you have to show ROI. To any marketers that feel that way, Doug has some advice for you - there are plenty of companies that need people who are good at what they do and already understand the value and importance of the marketing function. You should go work there.
The fundamental problem with data is that it’s looking backwards in the past. There is no data for the future. We have to remember that when it comes to sales and marketing, variance is the game. Data is not reality.
For all the attribution models, when you start to look underneath, what you’ll find is all this content that is supposedly attributing to great numbers is actually having a negative impact on the likelihood that someone who’s not already buying from you will buy from you.
If you’re selling a walkie talkie on Amazon, this stuff works great, but if you’re trying to sell a program to manage the walkie talkies it’s a different game.
There’s an attribution model called Time Decay that lowers the value of the first touch. But if Doug does his job right, isn’t the first engagement what adds the prospect to his universe? Does that elevate someone above someone who has never done anything?
Moving to the other models, first touch means all the revenue gets attributed to your first touch, which is hard because you really don’t know what the first touch was. That’s called dark funnel. If you want to use this models you should have a question on all your forms to let the person self-select where they came from and how they heard about you.
Last touch is attributing all the revenue to the last action - usually a sales email with a quote.
Multi-touch is letting every touch get attributed an equal amount of revenue which to Doug doesn’t seem right.
U-shaped was Doug’s favorite because it made no sense. It’s first touch and last touch with some attribution to a middle touch, so it’s weighted and gives first and last touch the most credit.
W-shaped is giving first touch, middle touch and last touch the most attribution with some small pieces inbetween.
The difficulty here is what are we hiring the touch to do?
Another problem with all of these models and the nature of this is it all overweights novel. By novel, Doug meas the lead that he’s had in the database for years. These models don’t show the same value in a new lead versus a lead that went dark and has come back to the light. Nor do they take into account client retention.
If you’re using attribution, it can lead you to false hypotheses. And it discourages failure. If you aren’t failing, you aren’t succeeding.
How do you measure marketing attribution?
- Growth rate.
- Cost of growth.
- Margin productivity.
The moment you start to ask the question - how much of this growth was me? - you’re commoditizing yourself.
How are we building into our environment to generate greater velocity? That’s how you should measure yourself.
This stuff is hard and difficult. That’s what makes it worth doing.
- The standard way of thinking about marketing attribution is not the right way to think about it. You have to find another way to show your value.
- If you don’t have skin in the game, you can’t win. No risk, no reward.
- You should be looking for insight indicators that allow you to create a hypothesis and test it rather than looking for attribution on a specific piece of content.
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