Conversions, attribution, and why a digital marketer’s head spins

By Niki Morock

We were talking to a prospective client last week, hoping to become this client’s marketing partner. During the conversation, they mentioned the problem with attribution that transcends that one particular conference table. It’s an issue that every digital marketer eventually faces unless they are happily oblivious to it, or they are only using one vendor/partner for their digital advertising.
confused marketer
Attribution means being able to credit a source, or sources, with sales or conversions. This particular organization’s representatives said that if they had made as many sales as all of their vendors are taking credit for, they would be thrilled (paraphrasing). Basically, the total sum is less than the number of the parts.

Let’s see if I can break this thought down with an example using the generic name Awesome Client (AC) and some made-up numbers for the purpose of simplifying the problem in this example.

AC has 50 different advertising agencies begging for a piece of its marketing budget. AC wants to use that budget as wisely as possible, and chooses the top 4 contenders – all who claim they will give AC the best return on its investment. All four agencies will use multiple tactics although each may use a different set of tactics. All four offer conversion tracking which they say will prove their value to AC over the long term.

AC gives each of the four a piece of the marketing budget and says, “show me what you can do.” Each month, all four report their campaigns’ progress and show excellent numbers in the number of clicks and conversions.

Agency Click-through Conversion View-through Conversion
Agency 1 50 100
Agency 2 60 120
Agency 3 35 40
Agency 4 45 70
TOTAL 190 330

 

At first glance, those numbers look great with a grand total of 520 conversions, but when AC compares the agencies’ reports to their actual sales, there is a huge discrepancy because their sales only total 250. How can the numbers be so far off?

First, let me define click-through conversions and view-through conversions. Click-through conversions happen when a person sees the ad, clicks or taps on it, and then immediately converts. View-through conversions happen when a person sees the ad, does not click or tap, but eventually converts within a given time period.

Taking credit for click-through conversions is pretty easy. On the other hand, attribution for view-through conversions is more complicated. Here’s why:

If the person who has seen the ad but not clicked on it eventually goes to the company’s website and makes a purchase, the agency should only get partial credit. That person easily might have seen 20 ads before converting – five from Agency 1, twelve from Agency 2, one from Agency 3, and two from Agency 4. Yet, if all four agencies are using cookies for conversion tracking, all four agencies are claiming credit for one view-through conversion.

How does AC decide which agency is truly providing the best return on investment? Is AC possibly over-buying since all four agencies can take credit for a single conversion? I think AC needs to rethink its strategy.

Right now, with technology as it is, the best way for AC to be more assured of its ROI is to pare down the number of agencies AC works with. There are too many cooks in the kitchen to know which one contributed the most to the meal. While there is always a chance that the agency (or two agencies) that is (are) ultimately chosen for the final, more focused digital strategy might not have been the biggest contributor, paring down will help make that determination. If they can’t perform the way they were claiming they were, then it’s time to go with a different agency.

There are still many other considerations with digital reporting. Clicks through to the landing page do not necessarily always lead to conversions. Sometimes, the clickers need time to think before making the purchase, which is why agencies now use conversion tracking. Yet, not all conversion tracking is created equal, and clicks that don’t convert shouldn’t be completely discounted. Traffic to a website still shows that interest in a brand has been created and eventually that person may become a regular customer – and that may not happen within the preset conversion tracking time period.

 

I hope my attempt at explaining attribution issues makes sense. Those of us who are tasked with proving our value to Awesome Clients are doing the best we can in an always-changing, technologically challenging environment. I, for one, do my best to stay current on the issues of the day in digital marketing. I read how others are struggling with the same questions, and nobody has really found the perfect answer yet other than the one I suggested – AC needs to test agencies one at a time. If AC is happy with the results, then stick with the one that is working. If not, move on. Spreading the love isn’t helping determine the best one for the digital marketing job.