attribution modeling - case study

Attribution ModelingGet the most out of Attribution Modeling - Measure the true value of all marketing channels

Foreword

If we are to summarize the current top 10 marketing topics around the world, attribution modeling must be one of

the latest hot topics within the industry. According to the report conducted by Econsultancy and Adobe in November

2012, only 26% of advertisers worldwide and 36% of advertising agencies carried out marketing attribution. It is truly

evident that attribution modeling is rapidly growing and its value is being recognized by a vast majority of marketers

nowadays. Based on the report, 29% of advertisers that do measure attribution say it has signi�cantly bene�ted their

business while 60% of those realized that it is bene�cial. Marketers can better understand their budget allocation,

gain insights into a�liate marketing e�ectiveness and optimize their marketing mixes.

However, attribution modeling is still at its initial stage of gaining popularity within China. Many of the marketers are

not familiar with attribution modeling and the purpose of this whitepaper is to elaborate on the use of attribution

modeling and demonstrate its e�ectiveness on measuring the success of your marketing e�orts.

　　

Co-founder of iClick – Ricky Ng

1

Table of Contents

Part One Why do marketers need attribution modeling?

- Why do marketers need attribution modeling?

- What is the biggest value of attribution modeling?

Part Two What is attribution modeling?

- What is attribution modeling?

- Commonly used attribution models

Part Three How attribution modeling creates value to marketers?

- Case analysis

- How to make use of attribution modeling to analyze your campaign?

Part Four An introduction to XMO attribution modeling

2

Part OneWhy do marketers need attribution modeling?

For many marketers, managing marketing budget and maximizing ROI (Return On Investment) are the biggest

objectives of every campaign. With the challenges faced by marketers on the complexity of media channels, it is

relatively di�cult to conclude the ideal channel to be used. When you plan to utilize your marketing budget for a

campaign, will you have the following di�culties?

- How to optimize channel mix to maximize ROI?

- Which channel is most suitable for my products?

- How do you manage the whole media buying process to measure the e�ectiveness in real time?

- Will there be any impact to the channel in the case of adding or reducing marketing budget?

- Any di�erence on user pro�le from di�erent media channels?

- Does this channel truly bring my marketing campaign with the most desirable results?

Why does attribution modeling gradually become critical to marketers? Below is an example to help you easily

understand:

For example, assume 10 successful conversions are received in a week from search engine marketing and display

advertising. If marketers could only track the conversions based on last click, then the result would show:

3

Last Click Conversion

1 Search Engine

2 Search Engine

3 Search Engine

4 Search Engine

5 Display Ad

6 Display Ad

7 Search Engine

8 Search Engine

9 Search Engine

10 Search Engine

As the above table illustrates, marketers may think that the conversion rate appears to be extremely low for display

advertising. In this case, marketers will intuitively allocate more budget to search engine marketing.

However, with end-to-end conversion tracking available, marketers can now better understand the process behind

each conversion more thoroughly:

Based on the analysis of conversion path, online display advertising has actually assisted 6 out of the 8 conversions

made from search engine marketing.

Do marketers now have a new perception of online display advertising based on its results? By learning the insights

from the conversion path report, marketers can now understand more about the “assist e�ect” amongst di�erent

advertising channels.

The main advantage of attribution modeling is to re�ect the real value of the contribution made to each channel. For

example, if 1 credit will be given only if the channel has contributed in a conversion, in this case, the value of search

engine marketing and display advertising will be calculated as follows:

4

Last Click Conversion Conversion Path

1 Search Engine Display Ad → Search Engine



4 Search Engine Search Engine

5 Display Ad Display Ad

6 Display Ad Display Ad




10 Search Engine Search Engine

Last Click Conversion Conversion Path Search Engine Display Ad

1 Search Engine Display Ad → Search Engine 1 1



4 Search Engine Search Engine 1 0

5 Display Ad Display Ad 0 1

6 Display Ad Display Ad 0 1




10 Search Engine Search Engine 1 0

Total 8 8

The biggest value of Attribution Modeling

The above example demonstrates the importance of attribution modeling. Not only it helps the marketers with the

ability to monitor performance of di�erent media channels, but it can also increase ROI (Return On Investment)

signi�cantly by re-allocating budget amongst channels. With some critical points mentioned above, more and more

marketers are willing to adopt attribution modeling in the long run.

Attribution Modeling - Bene�ts to Marketers

5

Able to reallocate budget across channels and improve ROI

Better understand how digital channels work collaboratively

Gained valuable insights into consumer makeup and behavior

To provide objective reasons to justify more marketing budget

Increase understanding on the role of online/o�ine media interactions

72%

63%58%

54%

44%

Data Source: Google analysis <Marketing Attribution: Valuing the Customer Journey>

Part TwoWhat is Attribution Modelling?

Attribution modeling is a set of rules that determines the sales or conversions assigned to each touch point in

conversion paths.

Savvy marketers understand that you don’t attract your customers with just one simple message, just one image,

or just one ideally positioned advertisement. It is a complicated process of planting the seed, nurturing it and at

last harvesting the fruits of your marketing e�orts.

Right before your customers buy or convert, they may encounter various parts of your online marketing campaign

including paid and organic search, email, a�liate marketing, display ads, mobile placements, etc. Each of these

factors has a signi�cant impact on the campaign results.

In the past, the value of the marketing campaign is only determined by the last click of the users in the media

channel. But when you think thoroughly, the user may be a�ected not just on his/her last click but also in other

areas during the conversion. Attribution Modeling o�ers a series of di�erent methods to determine the role that

channels play throughout the conversion journey.

Before the user completes a conversion, they will usually encounter with various advertisements many times.

Some media channels help to expose the ad to the users, while others may use to assist conversion.

6

Day 1: User views ad on website. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Day 2: User search for “smartphone”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Day 4: User clicks on Banner Ad. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Day 35: User sees a video ad of a smartphone brand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20 mins later: User searches for that smartphone brand. . . . . . . . . . . . . . . . . . . . . . . . . . .

Cause

Promote

Promote

Promote

conve-rsion

-

-

-

Last-Touch Attribution

The Last-Touch Attribution Model attributes 100% of the conversion

value to the last referring channel with which the customer comes

across before purchasing or converting. This model is extremely

common among most marketers, hence it is a great baseline for

comparison with other models.

Appropriate use: If your advertisements and campaigns are

developed to drive customers tra�c at the time of purchase, or your

business is mainly transactional with a sales cycle that does not

involve a consideration phase, the “Last-Touch Attribution” model

may be ideal.

First-Touch Attribution

The First-Touch Attribution model attributes 100% of the conversion

value to the �rst channel with which the customer comes across.

Appropriate use: If your advertisements or campaigns are developed

to maintain awareness with the customer, this model �ts you

perfectly. For example, if your brand is not commonly known, you

may primarily focus on exposing your brand to customers through

keywords or di�erent channels.

7

Commonly used attribution models

To optimize the use of attribution modeling, marketers must �rst clearly understand and identify its marketing

objectives regardless of whether to increase conversion quantity, increase user registration or download discounted

coupons, etc.

In the meantime, marketers should also understand how credit should best be assigned to each conversion funnel.

Below are the most commonly used attribution models and its appropriate use:

Last-Touch ModelORGANICSEARCH REFERRAL PAID AD DIRECT

The direct conversion value to the last referring channel

conversion value

100%

100%

First-Touch ModelORGANICSEARCH REFERRAL PAID AD DIRECT

Credits received from organic search is based on the �rst interaction.

conversion value

100%

100%

Time-Decay

If the sales cycle involves only a short consideration phase, then this model may be appropriate for you. It will assign

the most credit to touchpoints that occurred closest to the time of conversion.

Appropriate use: If you run one-day or two-day promotional campaigns, you may wish to assign more credit to

interactions during the promotion. In this case, interactions that occurred a week before have smaller value as

compared to those touchpoints near the conversion. The “Time Decay” model may be appropriate for assigning

touchpoints during the day or two to generate conversions.

Position-based

This model allows you to use a combination of “First-touch Attribution” and “Last-touch Attribution” models. Other

than assigning all the credits to either the “First-Touch Attribution” or “Last-Touch Attribution”, you can easily allocate

the credits between them. One commonly seen scenario is to assign 40% credit each to the �rst and last interactions,

and assign the remaining 20% credit to the middle interaction.

Appropriate use: If you primarily value touchpoints that sell your brand to your customers and �nal touchpoints that

resulted in sales, you can simply use the “position-based”model.

8

50%30%15%5%

50%

30%

15%

5%

Time-Decay ModelORGANICSEARCH REFERRAL PAID AD DIRECT

50%

30%

10%10%

50%10%10%30%

Position-Based ModelORGANICSEARCH REFERRAL PAID AD DIRECT

9

Part Three – How attribution modeling creates value to marketers?Case Analysis

- Customer: Vertical e-Commerce

- Objective: To increase online conversions

- Cost Per Acquisition (CPA): $380

- Promotional Period Oct to Dec 2012

- Promotional Results See below

Channel Consumption Conversion Share CPA

Google – Paid Search $512,236 1,980 31.9% $259 1

Google – Organic Search - 138 2 2.2% -

Baidu – Paid Search $1,403,232 3,123 50.3% 3 $449

Baidu – Organic Search - 29 4 0.5% -

Ad Network $308,983 178 2.9% $1,736 5

Ad Exchange $63,459 760 12.2% $84 6

Grand Total $2,287,910 6,208 100.0% $369

Assume the marketer has no assist from attribution modeling, the results on every channel will be indicated as

follows:

1. Google – Paid Search: CPA is ideal, but recommend to increase budget

2. Google – Organic Search: Low conversion channel generating poor performance

3. Baidu – Paid Search: Key conversion driver, but CPA exceeded and then require to lower CPA

4. Baidu – Organic Search: Low conversion channel generating poor performance

5. Ad network: High CPA but low conversion, exceeded the target CPA, hence recommended to drop this channel

6. Ad exchange: CPA is ideal but low conversion and require to increase budget

Note: The performance �gures are speci�c to this particular case study only. It does not represent the actual performance of the advertising channel in general.

10

But with the data provided by attribution modeling, the conversion value of each channel will be truly re�ected as

follows:

Conversion E�ective

Channel Consumption Conversion Share CPA Conversion Share Real Conversion CPA

Google – Paid Search $512,236 1,980 31.9% $259 2,099 33.8% $244 1

Google – Organic Search - 138 2.2% - 287 2 4.6% -

Baidu – Paid Search $1,403,232 3,123 50.3% $449 2,820 3 45.4% $498

Baidu – Organic Search - 29 0.5% - 233 4 3.8% -

Ad Network $308,983 178 2.9% $1,736 590 5 9.5% $524

Ad Exchange $63,459 760 12.2% $84 179 2.9% $355 6

Grand Total $2,287,910 6,208 100.0% $369 6,208 100.0% $367

Main changes of each channel:

1. Google – Paid Search: CPA remains ideal, and e�ective conversions increased slightly

2. Google – Organic Search: E�ective conversion has increased, in other words, this channel can assist other channels

for conversion

3. Baidu – Paid Search: E�ective conversion has lowered, in other words, this channel relies heavily on other channels

for conversion

4. Baidu – Organic Search: E�ective conversion has increased, in other words, this channel can assist other channels

for conversion

5. Ad network: E�ective conversion has increased signi�cantly, in other words, this channel is mostly used for

assisting other channels

6. Ad exchange – CPA has increased signi�cantly, indicating such channel belongs to the last part of the conversion

funnel

11

How to make use of attribution modeling to analyze your campaign?

When marketer gained a better idea of the actual conversion value from each channel through attribution modeling,

how he/she should practically apply the insights to optimize the campaign?

Attribution modeling goes beyond just the �rst step of optimization for marketers. In the next step, marketers should

look for relevant insights from other reports. In this case study, the marketer has the following insights and actions:

Insight 1:



Google – Paid Search $512,236 1,980 31.9% $259 2,099 33.8% $244

Google – Organic Search - 138 2.2% - 287 4.6% -

Baidu – Paid Search $1,403,232 3,123 50.3% $449 2,820 45.4% $498

Baidu – Organic Search - 29 0.5% - 233 3.8% -

Ad Network $308,983 178 2.9% $1,736 590 9.5% $524

Ad Exchange $63,459 760 12.2% $84 179 2.9% $355

Grand Total $2,287,910 6,208 100.0% $369 6,208 100.0% $367

The actual amount of conversion has decreased in

Baidu Paid Search after analyzed by attribution

modeling, in other words, the conversion from this

channel has in fact bene�ted from the contribution by

other channels. According to the XMO conversion path

report, 7% of the conversion comes from Ad Network

and Baidu Organic Search to Baidu Paid Search. Hence,

the focus of the optimization should lie on the basis of

these two channels instead.

Conversion should take place as below :

Baidu Organic Search:

Based on the keyword search report on the left,

marketers should ensure conversion driven keywords

are included in the paid search campaigns so as to keep

a constant conversion rate.

Baidu Organic Search - Search terms report (Simpli�ed version )

Search terms Cost Conversion Share CPA

Online Shop $ 54,935 184 3.5% $299

Online Shopping Site $ 54,618 137 2.6% $399

Shopping Discounts $ 30,702 74 1.4% $415

Free Delivery $ 18,205 58 1.1% $314

Discounted coupons $ 10,135 47 0.9% $216

Auction $ 17, 691 37 0.7% $478

Other Search Terms $ 1,729,183 4,733 89.8% $365

Grand Total $ 195,468 5,270 100% $363

Rank Conversion path report Share

1 Baidu – Paid Search 143%

2 Google – Paid Search 32%

3 Google – Paid Search → Ad Exchange 9%

4 Ad Network → Baidu – Paid Search 4%

5 Baidu – Organic Search → Baidu – Paid Search 3%

6 ⋯⋯ ⋯⋯

12

Insight 2:







Ad Network $308,983 178 2.9% $1,736 590 9.5% $524

Ad Exchange $63,459 760 12.2% $84 179 2.9% $355

Grand Total $2,287,910 6,208 100.0% $369 6,208 100.0% $367

After the analysis of attribution modeling, the actual

conversion coming from ad exchange platform drops

from 12.2% to 2.9%, which means such channel

bene�ts from other channels in order to get the

conversion.







6 ⋯⋯ ⋯⋯

Ad Network Conversion Performance report

Region Cost Conversion Share CPA

Beijing $ 372,417 1,247 20% $299

Shanghai $ 336.163 1,093 18% $308

Guangdong $ 332,110 963 16% $345

Chengdu $ 312,168 749 12% $417

Other $ 953,052 2,156 35% $434

Total $ 2,287,910 6,208 100% $369

Ad Network:

As Ad Network is de�ned as the top-notch “assisting

channel”, it is mostly capable of arousing brand

awareness to acquire new customers.

To enhance the e�ectiveness of Ad Network, marketer

can re-allocate their marketing budget based on

conversion district, as such to allocate more budget to

cities with higher conversion rates such as Beijing,

Shanghai, etc.

From the conversion path report, we can derive that the Google Paid Search is mainly the assisting source for ad

exchange platform. Although Google Paid Search itself is an extremely e�ective channel, there are still some users

who fail to be converted through this channel alone. Hence, it is recommended to adopt search retargeting to ensure

the campaign running in ad exchange can capture the losing users from Google Paid Search.

13

Insight 3:







Ad Network $308,983 178 2.9% $1,736 590 9.5% $524

Ad Exchange $63,459 760 12.2% $84 179 2.9% $355

Grand Total $2,287,910 6,208 100.0% $369 6,208 100.0% $367

From the data analysis combining attribution modeling

and conversation path, it is obvious that Google Paid

Search is a highly e�ectively channel, whether it serves

as a conversion channel itself or assists other

advertising channels to convert.

Therefore marketer may consider to focus on the

optimization e�ort for this single channel, for example,

to perform keyword expansion to boost the tra�c

volume.







6 ⋯⋯ ⋯⋯

14

Conclusion:

Attribution Modeling may not be able to answer all the questions arose from online marketing. Marketers should

make use of other in-depth data analysis and continuously try out di�erent optimization methods in order to

constantly improve their campaign performance. Below are some suggestions for the marketers:

Identify your marketing objective

Establish a clear and solid marketing objective is the �rst step to success. Is your primary objective based on attracting

new users, improving conversion directly or increasing the return rate of existing clients? Di�erent objectives

determine di�erent attribution models to be selected.

Refer to other reports to generate practical insights

Attribution modeling does not mean automation of all optimization procedures. Marketers should review other

reports (such as conversion path, conversion keyword reports, etc.) to conclude a feasible optimization solution.

Attribution modeling can help understand their product’s conversion funnel

Apart from increasing the conversation quantity, we suggest marketers to try shortening conversion time, for

example, add redirect function, or o�er discounts to those returning users generated from the ad as to increase the

chance of conversion.

Keep trying out di�erent optimization strategies

Invest time to try out di�erent optimization strategies and study their e�ectiveness instead of focusing on building a

perfect attribution modeling.

15

Part FourAn Introduction to XMO attribution modeling

iClick’s cross-channel optimization platform, XMO is capable to generate predictive analytics to assist marketers in

marking data-driven marketing decisions. Our product design aims at every detail from ad tracking, data analysis to

optimization. Our product edge include:

- Tracking code:

Capture every interaction of the user, from their �rst exposure to the ad until the last conversion completed to allow

marketer to better understand customers’ online behavior.

- Integrate conversion path with cross-channel analysis:

Provide channel assist report to analyze the relationships among di�erent channels so as to understand the real

value of the channels.

- Provide multi-dimensional and customized conversion funnel analysis:

Marketer can customize their unique conversion funnel to cater to di�erent features of their promotional products,

aiming at increasing the relevance of data analysis.

- Various types of attribution modeling:

Use di�erent attribution modeling on di�erent promotional products, allowing the data analysis to better re�ect

the actual performance.

XMO user can download attribution modeling reports from a range of attribution modeling

16

Assist E�ect Report – Better understand the real value of channel conversion Conversion Path – Understand the

frequent conversion path can allow

channel conversion

About iClick

iClick is the leading digital buy-side platform in Asia that integrates search, display, social media and mobile marketing capabilities to allow marketers to plan and manage their cross-channel campaign in one single destination.

Harnessing the power of programmatic buy and ad technology, the proprietary platform XMO (*Cross-marketplace Optimization Platform) is designed to deliver maximum ROI and greatest e�ciency to marketers.

Visit www.i-click.asia and follow us at weibo.com/iclickasiaSales enquiry: [email protected]