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A new multi-touch attribution whitepaper from Datalicious suggests the use of last-click attribution had led to an outdated and biased view of the digital landscape, meaning marketers are further away than ever from understanding true return on advertising spend (ROAS).
The data and analytics agency’s report, Media Attribution: Optimising digital marketing spend in Financial Services, sought to understand the true impact of digital marketing channels when a multi-touch attribution model is applied, in particular, assessing the performance of Facebook and display advertising against search advertising. The results challenge the validity of last-click attribution models and the industry’s outdated reliance on click-through rates as a metric for campaign success.
Developed over a five-month period with seven financial services brands (Suncorp, AAMI, APIA, BUPA, Aussie, St George and GE Money), the study summarizes the analysis of 702 million media touch points across 104 million purchase paths and 75 thousand conversions. It’s the largest attribution study of its kind to date.
Last-click attribution undervalues display advertising
The report shows that Facebook and display advertising is significantly undervalued in a last-click attribution model, with revenue credited to both increasing by 830% on average in a multi-touch attribution model. In contrast, the revenue credited to paid and organic search (SEM and SEO) remained constant or slightly decreased in a multi-touch attribution model.
Once an accurate multi-touch approach is implemented it shows a clear shift in conversion credit and revenue attribution between channels whilst the overall revenue generated by all digital channels remains constant.
Multi-touch attribution highlights the impact of advertising on conversions
Search is the most common customer touch point just prior to purchasing a financial product online, which means the majority of conversion credits are usually attributed to search in a last-click attribution model. Paid search (SEM) can no longer claim credit for most of the generated revenue and has to start sharing with other channels such as display that previously were not able to claim revenue due to an inaccurate measurement approach.
While Facebook and display advertising do generate clicks, they are not typical direct response channels, but instead indirectly influence conversions and build awareness that is then captured further down the purchase path by other channels such as search.
It’s all about achieving the right channel mix
Given there is hardly ever a single solution to a problem simply increasing Facebook or display advertising spend is not going to be enough. Like any other channel a successful campaign strategy does not only depend overall budget but also requires a good offer, effective creative and ongoing test and optimisation program.
Even though paid search (SEM) is likely overvalued that does not mean it does not work and should be switched off. It simply means the overall spend is not necessarily justified by the returns so optimisation and creative ways of reducing costs are required to again increase ROAS, The same goes for Facebook ads and display advertising that already have a positive ROAS - with a bit of optimisation the overall ROAS can be boosted even further.
In the end it is all about achieving the right channel mix and multi-touch attribution helps to identify the roles that different channels play in the path to purchase which is invaluable in developing an efficient, scalable and profitable digital media strategy.
Download the free whitepaper from Datalicious
This study was commissioned by Facebook, however all areas of the study were designed, managed and delivered by Datalicious. Facebook had no involvement in the data collection, development of the multi-touch attribution methodology or analysis and interpretation of the results.