It’s never been more important to get marketing analytics right. You need to know that every marketing dollar spent is delivering maximum impact.
As marketers seek to sift through unprecedented amounts of data, most remain unable to analyze it properly or derive actionable insights. A recent article by McKinsey suggested that only a small percentage of the value derived from advanced analytics approaches has been unlocked – as little as 10% in some sectors.
Multi-touch attribution uses granular, person-level data to measure past marketing performance. It calculates the impact of every touchpoint and dimension on each key performance indicator (KPI) in near-real time and produces a set of metrics that reflects the credit each channel and tactic deserves for its contribution.
Multi-touch attribution platforms consolidate and normalize previously siloed data to create a more complete picture of marketing performance. Using algorithmic attribution allows marketers to see which tactics drove conversions, for which audiences, and understand cross-channel influence.
This insight is actionable. Depending on the outcome, we can reallocate spend to boost high-performing tactics and prevent wasted spend on low performers.
Proving the Value of Multi-Touch Attribution
Nielsen understands that using multi-touch attribution to understand the ROI of every dollar spent at each part of the journey has never been more critical. We set out to prove the value of multi-touch attribution.
We analyzed 109 anonymized B2C client data sets made up of $2.8 billion in media spend and over 256 billion impressions over a 6-month period (from January 1 to June 30, 2018). The companies included in the analysis include a wide range of B2C brands in the automotive, retail, financial services, healthcare, telecommunications and other industries.
We found game-changing facts that show the direct impact of multi-touch attribution on the bottom line.
Fact #1: Multi-Touch Attribution Unlocks 25% in Opportunity Costs
One of our most surprising findings is that, on average, 25% of media tactics don’t have ANY impact on the bottom line. In other words, they don’t generate a lead, a site visit or a sale or any other KPI.
Nielsen analysis of client data across industry verticals, channels and KPIs showed that 25% of media tactics yield no conversions against a given KPI, such as a conversion or a lead. For these tactics, the total spend was greater than zero but the contribution of the tactic to conversions was zero.
This means that up to a quarter of your marketing spend is wasted. If you don’t know what’s not driving results, you’re using up your budget without getting your money’s worth.
Knowing which tactics aren’t producing results unlocks smarter spending. Cutting this “fat” will yield significant savings that can be reallocated to higher-performing tactics. Multi-touch attribution unlocks 25% in opportunity costs.
TAKEAWAY: By cutting spend on tactics that don’t yield conversions, smart marketers can re-invest savings into more effective channels or test new opportunities.
FACT #2. Multi-Touch Attribution Shows the Value of Every Channel
Do you find yourself going with a gut feeling about what’s working and what’s not? Many marketers do. Multi-touch attribution gives credit where credit is due.
Without multi-touch attribution, it’s easy to significantly under- or over-value the contributions of different channels to desired outcomes (KPIs).
That’s because when channels are measured in silos, it’s impossible to understand their true impact on conversions or the interplay between them.
The chart below shows how much credit a particular channel gained (+) or lost (-) in driving a desired KPI when applying multi-touch attribution versus last touch.
We looked at how much a given channel was impacting specific KPIs, such as brand engagement (i.e. first time site visitors), leads (i.e. content downloads, form completes), online sales, and offline purchases (i.e. call centers, in-store sales).
Nielsen analysis of client data shows that last-touch data can:
- overstate the contribution of a channel to a particular KPI by as much as 49% (for example, organic social’s contribution to offline conversions)
- understate the contribution of a channel to a particular KPI by as much as 215% (for example, paid social’s contribution to brand engagement)
This is just one sample from our data. A channel that underperforms in one campaign may outperform in others. Using multi-touch attribution lets you learn which balance of channels and tactics work best for your specific objectives.
TAKEAWAY: Multi-touch attribution helps smart marketers learn what’s working and what’s not, so they can identify opportunities to collaborate, test, and tweak over time.
Getting Marketing Analytics Right
As marketers face increasing pressure to deliver not just clicks, views and likes but long-term growth, you must adapt to the digital era to thrive. The reality is that all customers and their interactions aren’t the same.
Rather than rely on siloed, channel-specific metrics, marketers can and should use digital-era tools to measure person-level data across tactics and channels. Multi-touch attribution is a game-changer that can put your business on a whole new playing field.
Download our ebook to learn 5 Game-Changing Facts that Prove the Value of Multi-Touch Attribution.
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