Understanding Attribution 101

attribution tracking

Source: PMA Blog on Attribution Part 4: The Numbers

The conversation about who to attribute which sale to  in the online world is an ongoing one. It’s extremely complex and there are an incredible amount of variables to consider, not to mention how to understand of the data once it’s properly collected. Not only do we need to consider different affiliates (especially if you run your program on multiple networks) but also which marketing channel actually contributed to the final sale.

Do you reward an affiliate if it was your PPC ad that closed them? What if your email campaign or a facebook contest ultimately won the customer over, even if the affiliate was the reason they found out about you in the first place? How do you measure that? Do affiliates get the same amount of commission if two or three affiliates were involved in the sale? How do you split it up, since your margins are on the line?

There are so many questions and even the most experienced people in the industry are still trying to figure out how to properly manage attribution. That being said, it’s at least important to understand what it is and some of the elements that impact it.

Lisa Picarille of the Performance Marketers Association wrote a great 5 part series about it. Here are the links for quick reference.

Part 1: The Concepts

Part 2: The Pros and Cons

Part 3: Selling the Concept to Your Organization 

Part 4: By the Numbers

Part 5: How it Impacts the Perception of Performance Marketing

An example of why attribution in affiliate marketing is important is from part 2.  “Affiliates who often drive a sale to a merchant’s check-out page are faced with customers who see a discount or coupon box. That customer will typically leave the page and do a search for a coupon. If they find one at a coupon affiliate site and then return to make the purchase, the coupon affiliate will get credit for the sale. Some affiliates say that is not fair since they believe they did the upfront pre-selling job of getting the customer to the merchant’s shopping cart in the first place.”

This in itself should be a reason to look into this and better understand it. Are you crediting the right channels and the right affiliates to your sales? If not, how can you measure the success of each touch point? How can you successfully attribute budget to the highest profit or highest converting channels for new customer acquisitions?

By understanding attribution more clearly you will be able to make better decisions as to where you spend your advertising budget and learn which affiliates to focus your attention on. But being able to make decisions based on data rather than “gut feelings” your bottom line will be better protected and you will have opportunity to really grow profitable sales.

 

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10 Responses so far.

  1. ELTED says:

    Attribution is a bit of a headache, and in my opinion can cause endless debate, yes companies should be aware of the funnel process, however measuring impact is nearly impossible and can over complicate your general marketing.

    • Sarah Bundy says:

      It’s true you could look at this forever and there are many conversations that could take place to determine value of various touch points, however it’s something that will become more essential as online companies evolve to understand the impact each channel and each partner can bring. This is one reason many companies are now bringing in dedicated analysts to look at these metrics and make sense of them in order to determine how budget should be spent and how to get greater ROI.

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About Sarah Bundy

Sarah is a recognized digital marketing leader who is ranked in the Top 40 Digital Marketing Strategists and Top 25 Affiliate Marketing Bloggers of 2012, and is recognized by the New York Times as an expert in performance marketing. She has won over a dozen awards, is an international speaker and contributes to periodicals such as Feedfront Magazine and Small Business Trends. Sarah is the Founder & CEO of All Inclusive Marketing, a leading digital marketing agency known for delivering innovative, experience driven results that reach, engage and convert buyers online. Their clients range from e-commerce start ups to leading retail, travel and SaaS brands such as Norton Symantec, Southwest Vacations, and Dropbox, who want effective digital marketing strategy from innovative thought leaders.