Attribution Analysis without Paralysis | A New Ad Metric

We’re drowning in data, yet thirsting for knowledge.

Online advertising is the most measurable form of advertising on earth. But what if you discovered that today’s online measurement systems defining success, are wrong?

For Internet advertisers spending $70 billion globally each year–it couldn’t be. But it is. Here’s the problem.

Imagine you’re managing a multi-million dollar online ad budget. And you learn that today’s outdated online ad tracking systems give 100% transaction credit to the very last clicked or last viewed ad before an online transaction.

Example: if four Internet ads contribute to a transaction; today’s outdated systems allocate entire credit to the fourth, last ad–ignoring the first three ads, which actually drove the revenue.

Zero credit to revenue drivers, and 100% credit to the last ad placed. Frightening.

But enter the full funnel media attribution model. Robust media attribution systems like this recognize credit should be assigned to a team of Internet ads versus the last ad.

But not all attribution models and are created equal. Read here for seven key details you should know before using any attribution system.

Most attribution modeling systems require you to spend weeks analyzing just one week of data. Unless, however, you’re using an attribution system crunching hard numbers in the background–where attribution analysis, revenue, and media cost all converge in a single, elegant number (ARSR™).

Some call it a sound media buyer’s KPI…others call it attribution analysis without paralysis. But instead of drowning in reams of data, a week’s worth of data takes about 30 minutes to analyze, and about ten minutes to reallocate media for higher ROI.

We’re getting ahead of ourselves, so let’s lay the foundation.

At a basic level, C3 assigns credit to Originators, Assists, and Converters within a transaction.

A media attribution model should capture all online media sources from the top of the funnel where sales are originated…all the way down to the very bottom of the funnel. So in a $100 transaction, an Originator would receive a fraction of $100 attributed to them—and the Assist and Converter also receive fractional credit of the $100 amount attributed to them respectively.

100% of revenue credit is thus attributed and split among Originators, Assists, and Converters—accounting for the actual drivers of revenue, and matched to media cost to then determine, you guessed it, return on investment (a simple ratio C3 calls, Attributed Revenue-to-Spend Ratio).

The new ad metric: Attributed Revenue-to-Spend Ratio (ARSR™).

It’s a simple ratio that any media buyer or marketer can understand. If you have a 4.0 ratio for a specific keyword, or specific Display campaign–you’re getting $4.00 in revenue for every dollar spent on that particular media source. Conversely, if you have an ARSR of 1.25 for a particular media buy—you’re getting $1.25 in revenue for every dollar spent.

A media buyer simply looks for paid media sources with high numbers to scale…and low numbers to cut or improve. Quick, actionable, attributed numbers. The special sauce–is the numerator of the ratio (attributed revenue), which is derived from Full Funnel Attribution™ using C3 Metrics attribution gateway and transparent algorithm (more on those here).

Results?

In the longest-running attribution study of its kind (2 yrs), here are the results that full funnel attribution and the elegant ARSR™ metric delivered:

a) Seven-figure efficiency in the advertiser’s online ad budget
b) Display ROI improvement of 160%
c) Search ROI improvement of 98%
d) Accurate economic model to measure affiliate performance

Bottom line: millions of dollars in profit.

Some attribution systems will still leave you drowning in data, and thirsting for knowledge. And some won’t.

Which will you choose?