Growth in marketing budgets has stalled after continued increases in recent years. The pressure is on CMOs to contribute to the bottom line and justify spend. Today, the CMO’s challenge is to allocate budget correctly to get the most out of a company’s marketing investment.
Marketing mix modeling is an established method for inferring the relationships between offline and online channels and delivering recommendations for optimization. While marketing mix modeling can answer key channel allocation questions, this approach only works at an aggregate level. To tactically understand how an individual spot or ad performs, marketers need multi-touch attribution.
Multi-touch attribution allows marketers to track users across addressable channels and devices to understand the effectiveness of marketing tactics at extremely granular levels (creative, keyword, placement, etc.). Yet for many marketers, implementing comprehensive multi-touch attribution is more of an aspiration than a reality.
In an interview in MediaVillage, Global Head of Analytics Matthew Krepsik acknowledged this truth: “If we think about our constituents and our users, whether marketers or other business executives, what they really want is greater intelligence.”
Media research executive Charlene Weisler sat down with Krepsik to talk more about the current challenges and solutions around multi-touch attribution.
The Power of Data
As Krepsik stated, the ecosystem calls for a new kind of marketing intelligence. Dats is a key factor. As the premier source of marketing and media data, Nielsen is in a unique position to enable marketers to learn from and act on these insights.
We have opened up access to our data with partners to make it easier to use and more permissible for marketers and brand owners across the value chain. Our ability to bring complementary datasets together for specific use cases is a huge area of growth and innovation.
While Krepsik identified a brand’s ability to connect “a digital consumer with an offline consumer” as a tremendous opportunity, he noted that one of the challenges is de-duplicating data. Brands need to be able to identify when a single consumer interacts with them across various channels and devices, so that they don’t count multiple interactions as multiple people.
Krepsik gave a vivid example of these challenges, saying, “Your phone right now probably has more than 50 or 100 cookies on it. All of those cookies roll into a device. That device has to roll into other devices … [T]he first challenge is getting from cookies to devices and devices to people.”
De-duplication of data has moved to the forefront as, a decade into the smartphone era, most consumers continue to purchase new devices and update the devices they already own. Krepsik added, “The challenge is that we have gone past the period of “build” and we have to constantly reinvest in the updating.”
The Evolution of an Industry
Krepsik believes the attribution industry needs to advance to meet the needs of marketers in general and CMOs in particular.
Today’s multi-touch attribution models allow digital marketers to track the consumer journey, understand audience behavior at a granular level, and make decisions about “the cornucopia of [addressable] media channels and how they can get more improvement out of them.”
But CMOs need answers to big-picture questions that MTA may not answer, such as how much of their total budget to allocate to digital marketing.
So while multi-touch attribution solutions for digital media planning are well advanced, there are “significant areas of improvement” when it comes to maximizing the efficiency and effectiveness of an entire marketing portfolio.
The Future of Attribution
Krepsik says marketers often choose between multi-touch attribution models that offer speed and granularity and marketing mix models that offer scale and coverage. He believes that the attribution industry will continue to evolve to combine the best of both types of models.
“I see both of those pieces coming together in the next two years; leveraging the technology, real-time nature and granularity in the attribution model with the scale, coverage and sophistication of marketing mix modeling.”
Download our ebook: Untangling Attribution’s Web of Confusion to learn more.