John Wanamaker had it right, and wrong.
He’s perhaps most famous for saying he knew that half his advertising dollars worked…he just didn’t know which half.
He was right to ask the question because even advertising accountability today gets a lot of blank stares—and in today’s earnings environment we need much more.
But Wanamaker was wrong in searching for singular linear accountability (e.g. one ad = xx purchases).
I was fortunate many years ago to have a marketing executive from Kraft Foods speak to our Business School—Kraft was known as one of the most analytical of all marketers at the time.
I heard something I’ve never forgotten.
After many quantitative analyses, Kraft discovered there was no singular linear accountability in marketing. Meaning, they could never correlate one ad, or one channel of advertising to sales.
Jaws dropped…you could hear a pin drop.
The executive continued.
Although no singular silver bullet existed—what did exist was the following:
The sum of campaigns together…a team of ads…produced a correlation to revenue.
Fast forward to today.
We’re living in a world where every type of advertising, from digital to TV to OTT, is becoming fully addressable.
Chock full of data.
But perhaps more backward than the days of John Wanamaker because of today’s still prevalent, yet outdated, measurement using ‘last touch attribution.’
Last touch attribution flies in the face of marketers who know that multiple ads and multiple visits contribute to every conversion.
Sadly, most of today’s measurement systems (& marketers) give 100% transaction credit to the last clicked ad, or last viewed ad–before the conversion.
So if four ads contribute to a conversion, most measurement systems will allocate 100% of the credit to the fourth, last ad–ignoring the first three which actually drove the conversion.
But John Wanamaker, it’s OK—don’t turn over in your grave just yet.
Enter full funnel multi-touch attribution (MTA).
Multi-Touch Attribution is the identification of a set of user actions that contribute to a desired outcome and then the assignment of a value to each of those events.
MTA means: splitting and attributing revenue and transaction credit…one transaction at a time for an advertiser.
At C3 Metrics, all media sources are captured from the top of the funnel to the very bottom of the funnel in every conversion, and via machine learning credit is attributed correctly between what we call Originators, Rosters, Assists, and Converters.
And then, most importantly for Mr. Wanamaker, after credit is attributed to Originators, Assists, Rosters and Converters in a transaction—the respective cost or advertising spend is matched.
This yields a metric Mr. Wanamaker would love—Attributed Value to Spend Ratio (AVSR), where the successful portion of attributed revenue is attributed to an ad, and then divided by its respective cost.
A single metric, an even playing field, where 100% of revenue is accounted for, and every penny of ad cost is accounted for.
No last touch to usurp 100% of credit while every other revenue-driving source is ignored.
This single metric is used to reallocate more online ad dollars to media that actually works, and cut or curb ad dollars against media that doesn’t work.
Mr. Wanamaker, although full funnel media attribution is new, it’s finally here.
Rest in peace.