Multi-Touch attribution model for Shopify: What it is and How to do it
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The customer's journey spans many devices and touchpoints before resulting in conversion of products. Marketing needs to understand what content consumers have to receive to create positive outcomes. This is a guideline for deciding how and when to allocate advertising. If marketers understand the impact of different touchepionts on conversions then they can effectively spend the same amounts of money on similar touch points and divert money to the channels that have no effect.
There are lot of attribution models to measure the impact of touchpoints. You may question, I use shopify analytics, what is Shopify's attribution model?
What is Shopify attribution model?
Shopify Analytics' Marketing Reports feature two attribution models to assess credit for conversion event. The first is Conversion by First touch attribution, which provides all the recognition to the initial touchpoint; while Conversion by Last touch attribution assigns full credit of conversion to its concluding contact point.
Shopify attribution measures conversions based on the last clicked interaction, disregarding any credit to direct channels. This means that it will attribute credit for a conversion to the most recent click and its corresponding keyword, even if prior visits were from people who directly navigated to your eCommerce store. With Shopify Analytics' suite of tools, you can compare conversions between first-time visitors and those returning through their last interactions.
Both first-touch attribution model and last-touch attribution model belong to single-touch attribution model.
The Difference Between Multi-Touch Attribution and single-touch attribution Models
Multi-touch attribution models assign credit to more than one touchpoint during the buying process. For example, a user may have seen an Facebook ad on social media and then clicked on a paid Google search ad before making a conversion. With multi-touch models, each of those interactions would be assigned some credit for the eventual sale. This is different from single-touch models which only assigns credit to the first or last interaction that occurred during the purchase journey.
Benefits of Multi-Touch Attribution
Multi-touch attribution model helps marketers get a better understanding of where their ads are working and which channels contribute to conversions in order to allocate budget appropriately across various channels and campaigns. It’s important for marketers to understand how different touchpoints contribute towards conversions because it can help them make more informed decisions and optimize campaigns for better results.
More and more touchpoints are required to convert customers. So collecting customer's conversion journey becomes essential to measure touchpoints' contribution. A multi-touch attribution model gives marketers the ability to understand how these points are connected, and helps them make informed decisions about where their budget should be allocated for maximum return on investment (ROI).
"Customer journey is important for me to understand my customers. Especially how my customers interact with different campaigns across touchpoints such as Google, Facebook and Influencer campaigns. " From Alan, TexTale
Types of Multi-Touch Attribution Models
There are lot of models to determin how credit is given to touchpoints. Because in a customer journey, there maybe different devices, browsers, campaigns working together. So Shopify merchants need to understand which campaign is the key contributor in the conversions.
1, Linear multi-touch attribution model
Linear attribution model gives equal credit for all touchpoints in a conversion. This is the most basic model which assigns credit to each interaction based on its position in the user's journey, regardless of the impact each touchpoint has.
For example, there are 3 touchpoints before a conversion: Tiktok ads, Tiktok influencer marketing, Linkedin ads. In a linear model, 3 touchpoints receive 0.33 conversion each.
2. U-shape attribution model
The U-shaped multi-touch attribution model is kind of position based attribution model. It gives more credit to the first and last touches of a conversion, while assigning less weight to any touchpoints in between. This model is great for recognizing theaid search and other channels that typically drive the majority of conversions.
For example, there are 6 touchpoints before a conversion: Facebook ads, Tiktok influencer, email, Raddit social media, Google organic search, and referral. In a U-shaped model, 2 Touchpoints (Facebook ads and Referral site) receive 0.4 conversion each while Tiktok influencer, email, Raddit social media, Google organic search receives 0.05 each.
3. Time Decay Attribution Model
Time Decay multi-touch attribution model gives more weight to touchpoints that are closer to the conversion. It assigns most of the credit to the touchpoint nearest to a conversion and lessens as you go further away from the conversion. This helps give marketers insight into how quickly customers convert after being exposed to their marketing message.
All above models belong to rules-based multi-touch attribution models, meaning the weight is pre-difined. There are also models that adopts machine learning.
Algorithmic or data-driven multi-touch attribution models
Rule-based multi-touch attribution models assign credit to touchpoints by using pre-defined rules, algorithmic or data-driven multi-touch attribution models use data science and machine learning to determine the weight of each touchpoint. These models can be more accurate in assigning weights as they are based on actual user behaviour.
Benefits of Multi-Touch Attribution
If you're an eCommerce marketer, multi-touch attribution models are incredibly essential for assessing the impact of your digital campaigns. These models provide a much more comprehensive and individualized view than traditional single touch modeling approaches that merely take into account aggregate metrics.
By utilizing multi-touch attribution, marketers gain a much greater understanding of their customer's journey and are better able to customize messaging to reach consumers on the right channel at the right time. Armed with this granular data, it becomes easier for marketers to identify audiences across channels and pinpoint each user's marketing needs more accurately. In today’s world where people have become experts in avoiding marketing messages, using data-driven approaches like multi-touch attribution is key in meeting your customer's expectations.
Not only does multi-touch attribution enhance the customer experience, but it also helps marketers increase their return on investment. By providing insight into which campaigns are most successful and least successful, this solution can not only reduce sales cycles, but also empower brands to make more informed decisions with fewer yet more impactful marketing messages.
What is multi-touch attribution vs marketing mix modeling (MMM)
Multi-touch attribution and marketing mix modeling (MMM) are two distinct yet related approaches to measuring the effectiveness of different channels, campaigns, and ad placements. While both methods can help marketers understand how their efforts contribute to conversions, there are some key differences between them that should be taken into consideration when devising an overall strategy. Multi-touch attribution models assign credit to more than one touchpoint during the buying process while MMM looks at a variety of factors including channels, campaigns, pricing strategies and other variables in order to determine which ones have had the most impact on sales or leads. By understanding these differences between multi-touch attribution and marketing mix modeling (MMM), marketers can make better decisions about where they should allocate resources for maximum return on investment (ROI).
How to get started with multi-touch attribution
How to get started with multi-touch attributionFor Shopify merchants, it's essential to understand customer journey, and choose an attribution model to connect marketing campaigns and their conversions. We have seen some high growth brands build their flyerwheel based on 3 points:
1, Experienment campaigns based on combination of ( Creatives, copies, audiences)
2, Get multi-touch attribution analysis and customer level conversion journey.
3, Scale the hign performance campaigns and turn off the bad one.The attribution report is critical, since brands need this data to make decisions of campaign optimization. All the tactics can't run well without great data.
Step #1: Deploy Marketing Analytics Software
There are lot of marketing attribution apps for Shopify merchants. Some best matches should have deep integration with Shopify to make sure you can easily deploy.
Step #2: Capture your marketing data
To get customer behaviors raw data, you need insert tracking snippets. These snippets track most customer conversion events such as page view, add to cart, chekout start, payment info and finish purchase.
Managing tracking snippet can be complicated. Attribuly has released a code free solution, which integrates with Shopify pixels & customer events. This future oriented solution can save lot of work for browser side tag management.
Further more, you may also get conversion event from Shopify server-side tracking. Because some orders could not be triggered at broswer side. For example, the recurring orders.
Step #3: marketing channels integration
To understand detail customer source, you need connect different channels. By integrating with Google ads, you can get what key the customer clicked, ad spend and ad level ROAS. Integrating with Facebook ads, you get what ad the customer clicked, as well as ROAS.
So by integrating your first party data including historic data, you get accurate insight of blended or single ad performance. This important data is key to make sure you don't spend money to wrong campaigns.
You can also connect to klaviyo, uppromote etc. The more you connect. The more marketing trouchpoins you connect, the higher grade data you will get.
Step #4: Set up conversion goal
Setting up a conversion goal is an important step when setting up attribution analytics for Shopify ecommerce businesses. A conversion goal allows marketers to track the customer journey and understand how their marketing campaigns are contributing to sales or leads. It can also help them identify which channels, campaigns, and ad placements are most effective in driving conversions.
Most brands set up goals for different products at different stage. You will find this setup is easy if there are integration with Shopify. What you need to do is just select event type and products you want to put into goal. Then the software will automatically finish the rest.
Step #5: test different attribution models
Marketers targeting consumers with short sales cycles and limited contact points( typically fashion) can easily identify messages that spark or finish the sale by utilizing first or last touch attribution models. Still, neither of these approaches allows marketers to evaluate how successful other interactions across the customer journey are.
For marketers needing to communicate with consumers over an longer sales cycle and more touchpoints prior to conversion(typically product with high price), there are moulti touch attribution models that can identify the most effective steps.
For advertisement, you can view a blended ROAS across marketing platforms, to view overall return. Or dive into single ad ROAS to find the best performing campaigns. The ROAS will be changed according to multiple models you select.
You may want to check every conversion's customer journey. So you get rich insight of the customer portrait. With some external customer information, such as social information. You will have clear understanding your audience's portrait.
You may have lot of campaign in testing, so you will scale the best performing one. In a long run you invest money to all the performing campaigns so you ROAS keep in a stable and high level.
Step #6: check conversion paths
Conversion paths give you a birdview on some most important route that your customer convert. So you may invest more routs with highest conversion rate, conversion value. Aware that using different models with result differently.
Multi-touch attribution tools are invaluable for Shopify merchants who are looking to maximize their ROI in the crowded ecommerce space. By understanding how their customers interact with various channels and campaigns throughout the customer journey, marketers can make more informed decisions about how to allocate marketing investments and resources. Additionally, by carefully evaluating their data and experimenting with different models, they can further refine their strategies and ensure that they are getting the most out of every dollar spent. With the right approach, multi-touch attribution can be an effective way for Shopify merchants to understand their customers’ behaviour and maximize their marketing ROI.
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