The Importance of Properly Tracking Digital Marketing Dollars

Digital marketing has come a long way from its early days of banner ads and pop-ups. Today, it is a complex and multi-faceted discipline that encompasses everything from social media and content marketing to search engine optimization and pay-per-click advertising. As digital marketing has evolved, so too have the tools and techniques used to track its effectiveness. However, one area that still presents challenges for many marketers is attribution.

Attribution is the process of assigning credit to various touch-points along a customer’s journey towards making a purchase. It’s a way to understand which channels and tactics are driving conversions and which are not. Without proper attribution, marketers are left in the dark about where to allocate their budgets and which strategies to pursue.

The vast majority of digital marketing attribution models are built on the last touch mechanism. This means that whichever platform a customer is using at the time of their purchase is given credit for the conversion. If you are following this model, you are likely moving a lot of your budget away from social media because you just aren’t seeing conversions there. But have you noticed that your conversions may start to drop when you do this? That’s because the last touch attribution model is deceptive because it is not showing you the whole picture. It’s only telling you what platform your customer used to make the final step in their journey through the funnel.

In the same way, focusing on the first touchpoint your customer makes with your brand is equally deceptive. This is because the customer’s decision to purchase is rarely based solely on one touchpoint. Instead, it’s usually the result of multiple touch-points working together to create a cohesive and persuasive narrative.

So, what’s the solution? How can marketers properly track their digital marketing dollars and ensure they are allocating their budgets effectively? The answer lies in understanding attribution as a holistic process that encompasses the entire customer journey.

When you have a proper attribution mechanism, you can tell which channels are building brand awareness, which are directing customers toward your last-touch platforms, and which are not contributing at all. Correct and thorough attribution helps to shift dollars around so that you are focusing on the platforms that contribute to your customers’ entire journey with your brand and not just the one that is closing them.

For example, let’s say you have a customer who discovers your brand through a Facebook ad, then visits your website a few times over the next few weeks, reads some blog posts, and ultimately makes a purchase after receiving a promotional email. In this scenario, attributing the sale solely to the email would be misleading. Instead, you need to understand how each touchpoint contributed to the sale and adjust your marketing strategy accordingly.

When you can properly track your digital marketing dollars, you are also able to identify and pre-empt cycles. In the pre-digital marketing era, it was well-known that when the Super Bowl was being broadcast, the television advertising space was golden. By the same token today, when certain shifts happen in the digital world, one platform may be more effective than another. When you have a good attribution process in place, you will be able to move with these shifts and make the most of them.

Proper attribution can also help you identify which channels are driving customer engagement and which are not. For example, you may find that your social media channels are not generating many direct sales, but they are driving a lot of traffic to your website and generating a lot of engagement. This is valuable information that you can use to adjust your social media strategy and optimize your content for engagement rather than direct sales.

Another benefit of proper attribution is that it can help you optimize your marketing campaigns in real-time. By understanding which touch-points are driving conversions, you can adjust your campaigns as needed to improve their effectiveness. For example, let’s say that you’re running a pay-per-click (PPC) advertising campaign on Google AdWords.

With proper attribution, you can see which keywords and ad groups are generating the most conversions and adjust your bidding strategy accordingly. You can also identify which landing pages are converting the most visitors and optimize them for better performance.

In addition to optimizing your campaigns, proper attribution can also help you improve your overall marketing strategy. By understanding how your customers move through the funnel, you can identify areas where you may be losing them and adjust your strategy to address those issues.

For example, you may find that customers are abandoning their carts on your website, which indicates a problem with your checkout process. By fixing this issue, you can improve your conversion rates and drive more sales.

Properly tracking digital marketing dollars requires a comprehensive approach to attribution. Rather than relying solely on last-touch or first-touch attribution models, marketers need to understand how each touchpoint along the customer journey contributes to overall conversions. By doing so, they can optimize their campaigns, improve their overall marketing strategy, and make more informed decisions about where to allocate their budgets. Ultimately, proper attribution is the key to achieving long-term success in digital marketing.

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