Net Gains: Evaluating Your Attribution and Multi-Action Tracking23 Nov, 2009 By: Matt Naeger Response
Building a plan for your Internet marketing program is often as complex as picking the next hot tech stock to invest in so that you can retire early from your day job. In both cases, the more you know, the better you are able to determine how to spend your money. However, the question that not enough people ask themselves is: “How are we certain that what we know is the whole story?”
The “whole story” begins with understanding what factors attribute to your conversions. You can’t invest your money wisely if you don’t understand what drives people to take action within your Web site. Conversion attribution factors can make a sizable difference in how you plan your Internet marketing budgets. And some conversion factors are in areas you may not initially suspect.
The Importance of Attribution
Attribution helps you understand conversion factors because it enables you to identify which factors in your marketing campaigns bring potential customers to the top end of your conversion funnel. Once you identify these “starter” actions in the early part of your online sales cycle, you can better budget to those activities.
Marketers often miss this top part of the funnel because the connection to sales is not initially apparent. In the end, however, these customers may lead to conversions at an effectiveness and efficiency unseen elsewhere in your funnel. More important, investing in them could help lift the overall performance of your campaign.
The Use of Multi-Action Tracking
Once you have identified the actions that contributed to the top end of your conversion funnel, the next step is to track your customers’ actions. Do they move through your funnel in the way that you’d like them to? Multi-action tracking will underscore this and provide insights — some that are surprising.
For example, search engine marketing (SEM) can be the most efficient channel for acquiring new profitable sales. And marketers often derive this by looking at the actions in the bottom part of the funnel. What marketers miss are the actions taken while a consumer was becoming aware and educated on the product along his/her journey.
This oversight sometimes leads marketers to mistakenly decrease the quantity and spend of search campaigns because they invest in the middle and bottom parts of the funnel rather than the top. This investment becomes inefficient because, for example, mid-funnel keyword phrases may yield overall higher CPAs.
If marketers invest in the top part of the funnel (where keyword phrases are less expensive and, psychologically, the consumer is open to varied choices at the start of his or her search), then the math gets better. Important to consider is that three-to-six searches can be done prior to a purchase. With this assumption, 66-83 percent of all searches that do not directly produce a sale are still a vital part of the ongoing research and shopping journey. Are you set-up to capture and capitalize on them?
Here’s a search path example of a customer wishing to purchase a 46-inch LCD TV:
- Search 1: LCD vs. Plasma TVs
- Search 2: Big Screen LCD TV
- Search 3: Cheap Big Screen LCD TV
- Search 4: Sharp LCD TV
- Search 5: Sharp 46-inch LCD TV
- Search 6: Sharp 46-inch LCD TV deals
If you’re a marketer for Sharp, this search path is ideal. What multi-action tracking will answer is this: What led a customer to search for and then purchase a Sharp 46-inch LCD TV? Was it because he or she saw a review in an earlier search result? Because a competitor was advertising its benefits on Search No. 3? Because Sharp purchased an ad within each one of the six different search results? Or was this driven by a reason outside of the search activity all together?
Knowing these answers — through attribution and multi-action tracking — will enable marketers to make better decisions on budget and resource allocation for any Internet marketing program, and specifically for search.