September 11, 2018 - By Wayne St. Amand, CMO, Nielsen Visual IQ
The original version of this article appeared in MarTech Advisor.
Gartner’s hype cycle describes a five-stage pattern that almost all new technologies (or concepts or tactics) follow: from initial euphoria to disillusionment to realistic expectations (coupled with technology improvement) before widespread adoption yields productivity.
In its most recent hype cycle for digital marketing and advertising, Gartner predicts that multi-touch attribution is midway through its development cycle. It’s flanked by three other promising tactics -- mobile commerce, multi-channel marketing and native advertising -- that Gartner predicts will reach the plateau of productivity within two to five years.
For context, other innovations on the graph include real-time bidding (on the far right with less than two years to the plateau), and artificial intelligence for marketing (on the very first upward slope with a 10+ year adoption timeline).
It’s clear that marketers are clamoring for advanced measurement capabilities. Multi-touch attribution is an approach whose time has come.
Here are four reasons why marketers don’t have to trust their gut feelings when it comes to better performance.
At this point in the life cycle of multi-touch attribution, its potential is greatly underestimated. Critics focus on their disillusionment after sky-high expectations of “the next new thing.”
According to Scott Brinker, this is actually good for forward-looking companies. On his Chief Marketing Technologist blog, Brinker writes, “The gap between expectations and reality creates opportunities for a savvy company to manage to the reality while competitors chase the hype cycle.”
While some have claimed that industry consolidation, such as Visual IQ’s acquisition by Nielsen (and Convertro by Oath and Adometry by Google 360) marks the end of an industry, in fact these realignments signal that multi-touch attribution is moving from its experimental phase to validation by big players and expanding markets.
These firms see opportunity in multi-touch attribution and are poised to turn it into a massive space. Larger companies have the unique insights, assets and experience that only enterprises with huge, mature installed bases can bring to the table. They also tend to enjoy robust R&D budgets and the ability to tackle and overcome challenges that would styme smaller organizations.
We’re witnessing a maturing industry. Multi-touch attribution is approximately a ten year-old practice that has been gaining steam in the last five years. The entry of these big players and greater investments in advanced attribution are a sign of things to come. Bottom line, these acquisitions are growing and evolving the space well beyond its start-up roots.
Attribution is complex. Data collection, integration, and analysis aren’t simple endeavors. Executing a successful attribution practice requires skillful change management as teams and agencies rethink processes, metrics and siloed reporting structures.
To succeed, customers have to work hand-in-hand with their vendors. Some cynics could fairly claim that the industry has under-sold the challenges of a large scale implementation, which may take months to produce results.
We admit perfection is unattainable. There is no data nirvana where every touchpoint lies swaddled in its cradle, ready for marketers’ loving attention. But vendors will continue to strive for it, sharing enhancements with customers as they iterate.
We understand the challenges better than ever before. While new challenges continue to emerge, with time, we get closer to driving even bigger rewards for marketers. And the rewards are well worth the effort.
For large advertisers with media budgets of $5, $10 or even $20+ million, optimizing with the intelligence provided by multi-touch attribution can literally save millions of dollars each year while improving the marketers ability to deliver results. A better result at a lower cost is what we’re all striving for.
Which brings me to my next point: Why choose multi-touch attribution?
As a marketer, three things are very important: 1) what percentage of my marketing spend is effective; 2) what percentage is ineffective; and 3) how can I maximize the effective portion of the mix to create the best outcomes for my business?
Multi-touch attribution is the only technique that attempts to answer these questions at a detailed tactical level. And I think we can all agree that being driven by data is better than being driven purely by gut feel.
In the digital era, with consumers interacting with brands continuously and on-the-go, you need intelligence in as close to real time as possible. Other attribution approaches, from simplistic last touch to sophisticated marketing mix modeling, don’t operate at that cadence.
If your reports are six months old (or more), that’s not the best insight for daily, weekly, or monthly campaign optimization. Frankly, even if the results of multi-touch attribution are less than 100% accurate, that’s better than 0% accurate.
Multi-touch attribution may not be perfect but it’s the only way forward. For marketers used to operating with little-to-no guidance, having some data-based insight is incredibly valuable.
With multi-touch attribution, you gain the ability to collect information in a single hub and get a view of campaigns while they’re in flight. It’s simply a tool to do better, and marketers are looking for this tool.
Marketers’ worlds are filled with tactics that can change on a weekly, even daily basis. Strategic modeling of all types helps set long-term objectives. But multi-touch attribution is the only option for those who seek to iterate and improve while their marketing and media are in market.
Today’s addressable world requires multi-touch attribution. It’s the difference between getting a summary view of marketing performance at the end of the quarter and knowing exactly which creative worked best yesterday.
With a clear understanding of the touchpoints that drive performance, CMOs can make smarter decisions and direct their teams to pump up the volume on the tactics that are working, and ditch the ones that aren’t.
In AdExchanger, Gartner Research VP Marty Kihn writes, “To survive, independent MTA vendors will have to focus on their omnichannel models, pairing MTA and MMM for a holistic view of online and offline media.”
This is how we think attribution will evolve. As part of Nielsen, we now work with the largest marketing mix modeling practice in the world, we’re on the front lines of the next big thing.
Nielsen’s Matt Krepsik, Global Head of Analytics, says marketers often choose between multi-touch attribution models that offer speed and granularity and marketing mix models that offer scale and coverage. He believes that the attribution industry will continue to evolve to combine the best of both types of models.
“Where I see the industry going in the next two years is that both of those pieces come together; leveraging the technology, real-time nature and granularity in the attribution model with the scale, coverage and sophistication of marketing mix modeling.”
And that’s something we can all look forward to.
To learn more about how you can be a better marketer in the digital era, download our ebook: Crossing the New Digital Divide: Your Guide to Marketing Effectiveness