Scientific Attribution: Maximizing Digital ROI by Dave Mundo
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Scientific Attribution: Maximizing Digital ROI by Dave Mundo
- 1. Scientific Attribution: Maximizing Digital ROI Dave Mundo VP, Analytics Director @davemundo 1
- 2. BKV is a full service agency helping clients since 1981 2
- 3. BKV offers a full suite of Analytics solutions Marketing Mix Analysis Scientific Attribution Loyalty Analytics 3 Predictive Modeling Advanced Analytics Reports
- 4. Scientific Attribution Agenda What is Digital Attribution? 4 Scientific Digital Attribution Does it work? Getting started
- 5. What is Digital Attribution? Scientific Digital Attribution • Defining attribution • Traditional attribution models • What are marketers using? 5 Does it work? Getting started
- 6. Continued growth in digital marketing spend is spurring interest in ROI measurement U.S Online Ad Spend (in billions)* $62 $58 $60 $53 $47 $50 $40 $40 $32 $30 $20 $10 $2011 2012 2013 2014 2015 2016 ----------------------------Estimated ---------------------------- 6 *Source: eMarketer, Jan 2012
- 7. Diversification of channels is a major trend in digital marketing U.S Online Ad Spend by Channel (in billions) Search Banner Ads Classifieds/Directories Video Rich Media Other $50 $40 $30 $20 $10 $2010 2011 2012 2013 2014 2015 ----------------Estimated ---------------- 7
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- 9. Attribution assigns credit for conversions Brand Keyword Search Email Ad NonBrand Keyword Search Affiliate Network Banner Social Media Ad Conversion 9 Lays foundation for digital media ROI measurement Optimizes Budget Increases ROI
- 10. Current approaches to attribution rely on the marketer to assign credit First - Click Attribution 100% credit 100% credit Last - Click Attribution Shared Credit Attribution 25% credit 25% credit 25% credit Recency - Based Attribution 10 25% credit 10% credit 20% credit 30% credit 40% credit
- 11. Poll: Which attribution method do you use? First/Last Click Shared Credit Recency-Based Algorithmic/Scientific Other None 11
- 12. Most digital marketers are using “traditional” attribution – or no attribution at all! IAB Poll*: which attribution method do you use? None 44% First or Last Click 30% Shared Credit 17% RecencyBased 17% Algorithmic / Scientific Other 12 11% 1% *Source: Interactive Advertising Bureau – Digital Attribution Comes of Age
- 13. What is Digital Attribution? Scientific Digital Attribution Does it work? • Why do we need it? • How does it work? • How is it implemented? 13 Getting started
- 14. Current methods assign credit in a biased and arbitrary way First - Click Attribution 100% credit Ignores Everything After First Click 100% credit Last - Click Attribution Everything Is Ignored Except Last Click Shared Credit Attribution 25% credit 25% credit 25% credit 25% credit 10% credit 20% credit 30% credit 40% credit Constant Weights Used Throughout Recency - Based Attribution Subjective, for those with “Last Click Separation Anxiety” 14
- 15. Our understanding of channel-level performance is distorted by current attribution Display Media Display Display • Primarily an assist media • Generates very few clicks Search Paid Search Conversion • Primarily a converter • Generates many clicks 15
- 16. Advanced attribution approaches need to address limitations of traditional methods Traditional Solution Uses incomplete view & click data Utilize all available data Ad Server data logs Requires marketer bias Rely on data to drive results Statistical Analysis Easy to implement 16 Advanced Maintain implementation ease Integrate findings with media buying
- 17. Recent advances are enabling data-driven attribution for advertisers and agencies Demand for more precise online ad spend ROI Availability of granular data Advanced modeling techniques 17 DataDriven Attribution Vendors
- 18. Independent studies confirm the rising tide of attribution modeling Forrester Wave: Interactive Attribution Vendors “Last click still survives but we see accelerating momentum to cast it aside and implement interactive attribution” “Since 2009…the market has gained momentum” “Benefits for digital marketers include […] improved multichannel measurement, data-driven spending and strategy decisions, and media buying leverage” “Algorithmic attribution [is] helping value marketing efforts, identify and eliminate waste, and optimize media plans…to boost ROI” 18 IAB: Digital Attribution Comes Of Age “44% of interactive marketers don’t have processes in place to assign credit to their efforts, indicating that adoption of attribution has room to grow”
- 19. Scientific Attribution delivers on the promise of full funnel measurement Email Display Display Search Social Rich Media Search Display Search Purchase Purchase Purchase Account for all touch points when assigning purchase credit 19
- 20. A scientific approach to attribution: important factors Advertising expertise • Digital agencies manage millions in online ad spend each year • Understand the challenges of online media optimization Customized statistical approach • Build custom models to understand true value of media channels Unbiased results 20 • No prior assumptions are made • Results reflect the impact of each channel on purchases
- 21. A statistical model unearths relationships between a set of factors and a response Moderate Predictor Strong Predictor Purchase? User Search A Yes Yes Yes B Yes No No C No Yes Yes D No No No E 21 Display Yes Yes Yes
- 22. Scientific Attribution also incorporates non-media factors that play a role in purchase behavior Landing page Seasonality Industry changes Media channels Geography Competition Time of day/ Day of week 22
- 23. Understanding (and potentially controlling) non-media factors helps boost optimization Landing Page • Determine which landing pages drive conversions • Optimize and test based on results Seasonal Effects Geography 23 • Key understanding of advertiser’s business • Develop a seasonally-adjusted media strategy • Discover which states respond to different channels/messages • Increase geo-targeting efficiency
- 24. Scientific Attribution should be continuously improved through collaboration Data collection Everyone! Advertiser/ Media Agency feedback Media 24 Performance reporting Analytics + Database Attribution Modeling Channel optimization Analytics Analytics + Media
- 25. Create actionable results via “Full Click” metrics Media Channel Last Click CPS “Full Click” CPS Difference Google Brand $24 $29 -21% - budget Google Non-Brand $58 $36 +38% + budget Bing Brand $22 $23 -5% Bing Non-Brand $48 $29 +40% Ad.com $87 $94 -8% $105 $76 +28% Google Display $65 $43 +34% Rich Media $41 $25 +39% ValueClick 25 + budget
- 26. Directly incorporate “Full Click” metrics into bid management tool (Marin, etc.) 26
- 27. What is Digital Attribution? 27 Scientific Digital Attribution Does it work? Getting started
- 28. BKV’s integrated approach to attribution proved useful for a major Telecom client Goal: increase media efficiency and identify valuable “assist” keywords Solution: Scientific Attribution model, focusing on ease of implementation Result: more efficient media buys 28
- 29. BKV’s integrated approach to attribution proved useful for a major Telecom client 1 • Discuss objectives and goals with client 2 • Build custom model for client • Collect/process appropriate data • Determine most appropriate modeling structure & approach 29 • Extensive testing process to verify model findings • Create actionable recommendations based on modeling results 3 • Implement Scientific Attribution • Report on findings over several weeks to gauge impact • Initiate refinements for future iterations
- 30. Scientific Attribution delivered tangible results upon implementation Scientific Attribution implementation results 2% daily spend increase 30 22% daily orders increase 16% cost per sale decrease
- 31. Scientific Attribution will continue to grow and evolve Understanding mobile marketing & cross-device ROI Determining the value of social media presence 31
- 32. What is Digital Attribution? 32 Scientific Digital Attribution Does it work? Getting started
- 33. Scientific Attribution success relies advance planning 1 2 Identify a partner for statistical modeling – with extensive media optimization and analytics experience 3 33 Verify that all your online marketing is being tracked and that cookie-level data is available Create a detailed plan for implementation, including a process for continual improvement
- 34. Scientific Attribution is a crucial component of an online media strategy Traditional methods fall short Industry-wide focus to improve digital attribution 34 Scientific Attribution not biased Case studies show strong results
- 35. Thank you! Visit bkv.com for more! Dave Mundo VP, Analytics Director dave.mundo@bkv.com @davemundo 35
Notes de l'éditeur
- Introduce.
- Aside from being a full-service media agency, BKV’s Analytics team offers a full suite of marketing analytics solutions focused on both online and offline media. We work with clients to determine how their online/offline media drives their sales/conversions.
- First we will discuss the concept of digital media attribution and why it is important for advertisers and marketers to understand it and get it right.Then we will explain a data-driven, scientific approach that ultimately results in efficient investment allocation across all digital media touchpoints.We will follow that with a recent case study for a telecom advertiser to show how we implemented Scientific Attribution and how it benefitted our client.Finally, we will discuss the best practices for getting started with advanced, scientific attribution. This is meant for advertisers who want to use this powerful approach to execute digital media as efficiently as possible.
- With that, let’s get started…(build)our goal in this first section is to define attribution and review commonly-used traditional attribution approaches.
- Why do advertisers need to understand digital media? One reason is its steady historical and projected growth.As more marketing dollars shift to digital, there is a growing need amongst marketers to obtain accurate ROI for their digital investments, especially when it comes to budget optimizations.For years marketers have analyzed data and conducted research to measure the impact of offline media. Digital media needs that same attention.
- Digital marketers are increasingly spreading their budgets out across different online media channels in an effort to reach their audience.As a consequence, marketers now need to be able to compare effectiveness between different channels, even though they may work differently and have different objectives.Next, let’s explore how these different online media types fit into the sales funnel and what that means for attribution.
- To measure ROI in digital marketing, we need to focus on the process of attribution. In other words, how do we attribute or assign credit to an individual digital media channel for a conversion or a purchase? A conversion or purchase could mean an online purchase, a lead, a lead or donation for a non-profit, etc.(build)Intuitively, we all understand that attribution has a huge impact on marketing decisions. The media tactic that receives the credit for the most sales is likely going to have a high ROI, which means that we’re likely to continue allocating marketing dollars towards that tactic in the future. As we optimize digital media budgets, we will benefit from an improved digital ROI.Next, we’ll look at how most digital marketers are currently handling attribution.
- Let’s look at current commonly-used attribution models.(Start animation and explain each model.)Looking at the current approaches to attribution, we’ll notice right away that they all have one thing in common: they rely on marketers to decidehow credit for sales is distributed. In the agency world, the last-click attribution method is probably the most popular, and has been the cornerstone of ROI measurement since the inception of digital marketing.
- Now we’d like to poll all of you to find out which attribution methods are most common among our audience.
- Attribution methods are beginning to gain traction, with a small % of respondents opting for advanced, scientific approaches.
- Now let’s explore Scientific Attribution, and understand(build)why marketers need it, how it works, and how to execute it.
- Let’s look at current commonly-used attribution models.(Start animation and explain each model.)Looking at the current approaches to attribution, we’ll notice right away that they all have one thing in common: they rely on marketers to decidehow credit for sales is distributed. In the agency world, the last-click attribution method is probably the most popular, and has been the cornerstone of ROI measurement since the inception of digital marketing.
- Current attribution models can easily bias results towards “bottom of the funnel” digital media channels. For example, Display generates few clicks and tends to get shortchanged in many attribution approaches. Paid Search acts as a converter and in some cases may benefit from the a priori biases inherent in traditional attribution techniques.The same can be said for other digital media touchpoints (SEO, affiliates, etc.). Quite simply, traditional approaches can lead to subpar optimization and digital media ROI.
- So clearly there are limitations with traditional approaches. Any advanced, scientific approach to attribution needs to directly address these shortcomings.(build)Any advanced solution that can reliably deliver on these three points will result in an improved data-driven measure of digital media effectiveness.
- Besides media agencies getting serious about scientific media attribution, many vendors dedicated to advanced attribution have surfaced. Therefore, there are numerous options and approaches for advertisers searching to “solve” digital attribution.Demand for a more precise ROI read, availability of granular ad server data, and advanced modeling methods are driving this.
- Advanced scientific attribution (aka algorithmic attribution) is gaining increased traction in the industry, as we’ve seen from both the influx of scientific attribution practitioners and industry research reinforcing its importance.Forrester recently published a report on the state of scientific attribution as well as highlighting a sample of vendors in this space.The Interactive Ad Bureau similarly released a study underscoring the importance and likely growth of advanced attribution techniques.
- Historically the impact of “top of the funnel” digital media interactions has been an unknown.(build)Scientific Attribution, however, delivers on the promise of measuring the impact of all media touch points and assigning credit appropriately.
- We have identified factors that we feel are important when tackling attribution.Digital media expertise is crucial when attacking scientific attribution in order to ensure the results are actionable and any budget reallocations are realistic based on advertisers’ other initiatives.Work with a nimble vendor who can create custom analyses based on an advertiser’s business environment and unique complexities.
- We realize talk of “statistics” often frightens people away and leaves them uttering the term “black box”. This thinking greatly underestimates marketers, as many are able to understand even complex data analyses and statistics.Scientific attribution modeling is actually not very difficult to understand.(explain slide)Now envision this for millions of user interactions and dozens of predictors. With a dataset so large, simply eyeballing relationships as we have done here is virtually impossible. Therefore, we use statistical techniques to help identify which predictors are the most important.
- I mention “dozens of predictors”…this is because we are using digital media execution as a possible predictor or purchase, as well as non-media factors.
- Scientific attribution is a continually evolving process that requires regular modeling refreshes that correspond to a business’ changing landscape and competitive environment.
- RAFUsing traditional media management approach—if GOAL is a $40 CPA (last click only shows 2 winners, we would cut off the rest); we would be solely running within branded SEM which we know is a bottom of the funnel PULL TACTIC—we would be closing off all the media that may be bringing audiences (esp NEW audiences) into the funnel IE: non-brand SEM, display and other engagement and PUSH centric mediaOur scientific attribution uses a slew of variables that then clearly communicate an adjusted CPA. The importance here is that the findings are really easy to understand and test against. We are looking at the channel level here, but our models go down to the placement or keyword level. We now see 5 winners , some on the fence, and underperformers.(build)Once we have the data, the art of media management comes in—we need to ensure media is as stable as possible in the channels where we buy from – no or minimal increase in CPCs for SEARCH and for display that we can buy more inventory at same prices...network mix can change -- so need to have transparency and partnershipwith sites/networks you work withWe then construct a test to see if same spend levels between the test period and model period are increased and improved. So, does it WORK?
- Findings only as good as the data we collectRight now there is a disconnect between desktop/laptop and mobile; however we are working with a couple of vendors that are connecting the dots—Drawbrige and TapadFB is making huge strides in attribution trackability, including third party tracking and pure play firms, however an easy step is to include view pixels on all custom tabs and to also employ third party redirects on all important clickable pieces of content, it is also important to potentially have longer windows in social…