The document discusses online attribution and how traditional attribution models may undervalue ROI by not fully accounting for multi-channel customer journeys. It proposes MediaCom's two-step approach of first analyzing how inaccurate last-click attribution is and then estimating the true ROI by using regression analysis to determine the impact of removing each channel from the customer's path to conversion. This approach provides a more accurate view of how all touchpoints contribute to sales.
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How do you value a click that doesn't lead straight to a sale?
1. Online Attribution
How do you value a click
that doesn’t lead straight to a sale?
June 2013
neil.charles@mediacom.com
2. Today we’ll cover
1. Attribution analysis: what’s the issue?
2. Traditional attribution may lead to under-valuing your ROI
3. What’s MediaCom’s approach?
4. What are the implications for online ROI?
5. Can we do the same for off-line channels?
3. A person who wants to buy a new laptop might make a purchase
something like this…
Google
search for
‘buy laptop’
Clicks a paid-for
Google ad for
currys.co.uk
4. A person who wants to buy a new laptop might make a purchase
something like this…
Google
search for
‘buy laptop’
Clicks a paid-for
Google ad for
currys.co.uk
Investigates some
other retailers
5. A person who wants to buy a new laptop might make a purchase
something like this…
Google
search for
‘buy laptop’
Clicks a paid-for
Google ad for
currys.co.uk
Investigates some
other retailers
Checks
currys.co.uk again
via a paid ad, by
searching
‘Currys laptops’
6. A person who wants to buy a new laptop might make a purchase
something like this…
Google
search for
‘buy laptop’
Clicks a paid-for
Google ad for
currys.co.uk
Investigates some
other retailers
Checks
currys.co.uk again
via a paid ad, by
searching
‘Currys laptops’
Purchases a
laptop the
following day, by
searching for
‘currys’
7. The customer who bought the laptop has done three
things that we can measure
Generic PPC
Click
Brand PPC
Click
SEO Click
8. Traditional attribution approach gives part of a single
sale, to each ad that the customer saw
Generic PPC
Click
Brand PPC
Click
SEO Click
9. But how much credit do you give each ad?
Generic
PPC Click
Brand PPC
Click
SEO Click
100%Last click wins
Equal weight
“Modelled” weight
33%33%33%
25% 25% 50%
10. If you remove an ad, you break the attribution chain and
the WHOLE sale is potentially lost
Generic PPC
Click
Brand PPC
Click
SEO Click
11. The traditional approach may lead you to under-value
your advertising ROI
Generic PPC Click Brand PPC Click SEO Click
33%33%33%
Traditional
Approach
Generic PPC Click Brand PPC Click SEO Click
100%100%100%
12. Assuming that every interaction which leads to a purchase
is essential, would give us the best case for marketing ROI
In the example of the laptop buyer, we can assume that if
either of the paid ads was removed, they wouldn’t have
bought from Currys.
This gives the best case scenario ROI for the ads
Calculating the best case is useful to work out how important
click-path might be
13. “Countless hours can be spent
manipulating and setting up data
before you can even think about
gleaning insights on your
campaign.”
doubleclickadvertisers.blogspot.co.uk
14. We take a two step approach
“How wrong is last click wins?”
15. We take a two step approach
“How wrong is last click wins?”
“What is the true ROI?”
16. Search works at the end of the funnel.
Display is less likely to be an end point.
% of ad clicks and views that lead directly to a conversion,
vs. appearing in a converting customer’s funnel (example client)
17. Which end points have attribution paths?
% of converting customers who have a multi-channel path,
by ‘last click wins’ end point (example client)
18. We can break paths down further, to see where
converting customers have been
Advert interactions anywhere in path, by end point (example client)
19. Now we can see the difference between how many
converting people saw an ad in total, vs. last click
Potential “Reach multiplier” over last click wins (example client)
20. Previous examples are typical of results we see across
multiple industries
Typical “Reach multiplier” with bands showing highest and lowest measured results
21. The previous analysis showed potential multipliers
Somebody seeing a display ad and then converting on a PPC
term, does not necessarily mean that the display ad is
responsible for that conversion
Many people who eventually go on to become customers may
see different ads, without reacting to them
24. With regression analysis, we can determine which
channels add to the chance of conversion
Affiliates Display Facebook PPC VOD
% of last interaction wins conversions 2% 65% 0% 27% 4%
Minus Affiliates 100% 5% 0% 0% 2%
Minus Display 60% 100% 100% 3% 100%
Minus Facebook 0% 0% 100% 0% 0%
Minus PPC 5% 4% 0% 100% 3%
Minus Retargeting 7% 16% 0% 5% 7%
Minus YouTube 5% 19% 0% 0% 100%
Modelled multiplier estimate 2.38 1.13 1.00 1.11 4.15
Lossfrom
removingchannel
Conversion Channel
Impact of removing a channel from current schedule
25. This can make working out ROI forecasts quite
complicated...
26. What about off-line attribution?
Off-line attribution can’t work the same way
because we don’t know exactly who saw a TV
or press ad
We need econometric modelling...
27. Econometrics measures and then improves the
effectiveness of advertising
Measures the effectiveness (return on investment) of past
advertising campaigns
Splits marketing campaigns into their individual parts
Forecasts the effectiveness of
future advertising campaigns
Uses forecasts to produce a
more effective marketing mix -50
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Sales(£'000s)
Press Radio
TV Store Openings
Seasonality Actual
Model
28. We start with a sales history; two to three years of weekly
sales data
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Sales(£'000s)
Sales
29. and a model, that at this stage doesn’t know anything at
all about sales movements
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Sales(£'000s)
Sales
Model
35. When TV is on air, search volumes increase dramatically
0 10,000 20,000 30,000 40,000 50,000 60,000
CPC
Organic
CPC
Organic
CPC
Organic
CPC
Organic
TicketsTrainCheapBrand
Number of clicks (Feb 2011, Central)
Base
Driven by TV
BrandDiscountProduct1Product2
TV campaign effect on number of clicks on branded and generic search terms
Pay per
click %
increase
Organic
% increase
Brand 218% 251%
Discount 9% 71%
Product 1 7% 322%
Product 2 23% 283%
36. Forecasting is the holy grail...
With attribution analysis and econometric modelling we can:
Forecast the impact of changing investment in a media channel
And...
Forecast the impact that this will have on other media channels
37. Attribution recipe
You will need...
1 x SQL server
1 x Database administrator
1 x copy of R (or similar)
1 x econometrician
1 x copy of Tableau
300m x rows of cookie data
3 years of sales data
3 years of search data
A full media spend history