Breaking down the basics of Marketing Attribution
You are a marketing professional. You work hard to use your marketing budget effectively, build pipeline and drive sales for your organization. You need to make sure that the marketing dollars you spend are getting the most bang for their buck, and you need an effective way to track which of those dollars are delivering the best ROI.
Marketing Attribution metrics are the key to your success. They help you determine which marketing efforts are driving sales and provide invaluable business insight into the efficacy of your marketing channels.
Marketing Attribution can be a very complex subject. To help simplify things for you, we broke down some key terms that you should know. Keep reading to learn about these common Marketing Attribution terms:
- Marketing Touch
- Lead Lifecycle
- Conversion Rate
- Model Validation
- Attribution Bake-off
- Data Infrastructure
Marketing Attribution, commonly referred to only as “Attribution”, is a way of measuring and quantifying Marketing’s influence on Pipeline and Revenue.
This is commonly achieved by tying marketing campaign activity back to opportunities, and then attributing a portion of the credit back to said campaign activity.
Quite simply, a marketing touch is any time a customer or prospect successfully interacts with your brand.
Keep in mind that an interaction should take place in order to be considered a marketing touch. As such, simply sending an email would not be sufficient. The prospect/customer would need to take an action as a result, such as clicking a link and downloading a piece of content from your website for it to be considered a marketing touch.
Marketing segments are groups of potential customers split based on a predetermined set of criteria. This is typically done by using behavioral and/or demographic attributes.
For B2C organizations, segments are usually divided by age, purchasing habits, interests, and location.
For B2B organizations, segments are frequently determined by industry, business size/revenue, geographic location, or buyer persona.
No matter how they are designed, segments help marketers deliver timely, personalized, and relevant campaigns.
Object (SFDC term)
Salesforce.com (SFDC) objects are database tables that allow SFDC to store data specific to each table, and which have relationships to each other (e.g. a Contact has a relationship to an Account). SFDC provides the ability to use standard objects (e.g. Accounts, Contacts, Opportunities, Leads, Campaigns, etc.) as well as custom objects.
Lead Lifecycle (aka Sales Funnel, Lead Waterfall)
A lead lifecycle helps organize your prospects/customers into a logical order based on their stage in your sales cycle, from first touch to customer and beyond.
The stages can be divided in many different ways, but having a clear definition of your customer experience flow is critical to accurate attribution reporting. A strong definition for each stage will also help you understand how to communicate effectively with leads in each stage of the funnel and ensure that they’re not overlooked.
A stage referrers to a specific part of customer journey in your Lead Lifecycle. As you define your lifecycle, you also need to define the stages that best apply to your business.
Examples of common stages: Marketing Qualified Lead (MQL), Sales Accepted Lead (SAL), Sales Qualified Lead (SQL).
This refers to how quickly your prospects/customers move between stages of your lead lifecycle. This is an important metric to track because it can highlight bottleneck areas where leads get ‘stuck’ as they work their way through the marketing & sales handoffs.
The conversion rate is a way of measuring the percentage of people who will take a desired action. In the marketing attribution space, it is typically used to measure the percentage of prospects/customers who move from stage to stage within your lead lifecycle. Tracking your conversion rate between stages will help you determine where you need to focus more of your efforts to move them down the funnel to the deals.
To figure out the return on your marketing investment, you need to know what portion of the revenue can be attributed to each marketing effort (i.e. Marketing Attribution). Divide that by the marketing dollars that were invested, your cost, and you’ll get your ROI.
This is another area where strong marketing attribution reporting is key: if you’re not sure which efforts are delivering the best ROI, you’re essentially playing a guessing game with your marketing spend. The challenge is usually on the cost front: how to capture it accurately and attribute it.
Model validation helps you determine how well your attribution reporting model is working, and it’s a crucial step on the road to implementing an attribution model. You’ll implement an attribution model, review the data it generates, make changes if necessary, rinse and repeat until you have an attribution model that works.
From first-touch to last-touch, time decay to linear, there’s no shortage of attribution models.* Each provides its own way of looking at the data, and each has its own strengths. An attribution bake-off helps you compare the different types of attribution reporting to find the ones that work best for you in different contexts.
Keep in mind that almost every solution has a slightly (in some cases radically) different way of calculating marketing attribution, so it’s very important to compare those differences through an attribution bake-off when choosing the right solution for your company.
Your data infrastructure will serve as the backbone for your attribution reporting. This is where your most relevant data is collected, and it needs to be reliable and agile, whether you have 4 or 400TB of data. Not only do your business process evolve with the market in which you operate, but you also want the capability to experiment with different approaches and turn on a dime as needed.
Every marketing department wants to improve conversion rates and increase ROI, but surprisingly, many organizations have no idea how their campaigns perform.
If you’re ready to learn more about marketing attribution, we’d love to help. We’ll start by evaluating your current plan so you have the insight you need to increase the impact of your business.
Reach out to email@example.com, and let’s get started.