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Lead Attribution: How to Select the Right Model for Your Business

June, 18 2024
Lead Attribution: How to Select the Right Model for Your Business

Seasoned marketers and revenue operations leaders agree that lead attribution is absolutely foundational to understanding the customer journey. As businesses strive to optimize their marketing efforts and prove ROI, selecting the right attribution model becomes crucial. Yet, navigating through the different options can be overwhelming. Whether you’re setting up lead attribution on your own or hiring a fractional revenue operations team to do it for you, it’s vital to consider certain aspects of your business when choosing an attribution model.

Each model offers unique insights into how customers interact with your brand. After all, the main purpose of lead attribution is to help paint a picture of the buyer journey. And each business has unique buyers and channels. A 10-person startup will likely select a different model from a 5000-person enterprise company, and B2B businesses will almost certainly have different needs from B2C businesses.

Even when you understand the differences between various models, it’s most helpful to ask yourself practical questions about your business to help you choose the right one. And keep in mind that what works for your company now might change in the future. Overall, it’s best to keep things as simple as possible until you can be sure that adding complexity will add value.

Different Types of Lead Attribution Models

You’re likely familiar with the main types of lead attribution models, but it’s worth aligning on definitions before diving into your unique business needs. Here are the most common models, each of which has a unique structure for assigning credit to different touchpoints along the customer journey:

1. First-Touch Attribution

This model attributes all the credit for a conversion to the first interaction a lead has with your brand. It's straightforward and easy to implement, making it popular among businesses, especially those with shorter sales cycles. That being said, it tends to overlook the influence of subsequent touchpoints that contribute to nurturing and converting leads.

2. Last-Touch Attribution

Conversely, last-touch attribution assigns all the credit for a conversion to the final interaction before a lead converts. This model is simple and intuitive, as it directly ties conversion to a specific touchpoint. However, it neglects the impact of earlier touchpoints that may have played a crucial role in the lead's journey.

3. Linear Attribution (Multi-Touch)

Linear attribution distributes credit equally among all touchpoints that a lead encounters before converting. This model provides a more holistic view of the customer journey, acknowledging the contribution of every interaction. Still, it may not accurately reflect the relative importance of each touchpoint in influencing the conversion decision.

4. Time-Decay Attribution (Multi-Touch)

Time-decay attribution gives more credit to touchpoints that occur closer to the time of conversion, gradually diminishing the credit assigned to earlier interactions. This model recognizes the diminishing influence of touchpoints over time, reflecting the typical behavior of leads as they move closer to making a purchasing decision.

5. W-Shaped/U-Shaped Attribution (Multi-Touch)

W-shaped and U-shaped attribution models offer more nuanced perspectives on the customer journey compared to other models. In a W-shaped model, credit is assigned to three key touchpoints: the first touch, the lead-nurturing touch, and the final conversion touch. This approach acknowledges the significance of both initial engagement and subsequent nurturing efforts in guiding leads towards conversion.

Similarly, in a U-shaped model, more credit is allocated to the first touch and the final touch, with touches in between receiving less credit. Both W-shaped and U-shaped models recognize the multi-faceted nature of the customer journey, highlighting the importance of various touchpoints in influencing the ultimate conversion decision. By capturing the complexity of interactions throughout the entire funnel, these models provide a more comprehensive understanding of lead behavior and enable marketers to optimize their strategies more effectively.

6. Algorithmic Attribution (Multi-Touch)

Also known as data-driven attribution, this model uses advanced algorithms to analyze historical data and assign credit based on the actual impact of each touchpoint on conversions. Algorithmic attribution takes into account various factors such as the order and frequency of interactions, as well as the specific characteristics of different leads. While it offers the most accurate and sophisticated approach to attribution, it is by far the most complex model and requires substantial operational maintenance.

5 Questions to Determine the Best Model for Your Business

1. Which attribution model are we currently using (if any)?

When figuring out which attribution is best for your company, start by considering which attribution model you’re currently using. Spend some time making a pros and cons list of how it’s working for your business, inviting other stakeholders into the conversation (particularly sales and marketing team members).

Even if you don’t have any automation for attribution, you’re probably still using some type of attribution (or different departments are using different models). For example, marketing might claim credit for a lead whose first touchpoint was a webinar, while sales might say this lead is actually theirs because they had a conversation with them on LinkedIn prior to them booking a demo. It’s vital to gain alignment across your go-to-market teams about which model everyone can agree on.

2. How complex is our sales cycle?

Next, think about how complex your sales cycle is. What’s the average sales cycle length? Do you tend to have large buying committees or a single buyer?

A more complex sales cycle doesn’t necessarily mean you should set up a more complex attribution model. Sometimes a simpler model is cleaner and allows teams across the go-to-market organization to align more easily because everyone can understand how the model works.

3. Which marketing channels are we using?

Take some time to make a list of all the marketing channels you’re using. Consider which channels are sourcing the most leads. How are you tracking these touchpoints?

Some marketing channels are easier to track than others. Your attribution model needs to take into account the time needed to assign attribution to various channels and the potential for inaccuracy.

One best practice I would recommend is adding a self-reported attribution field to your forms. This will allow you to catch some leads that seem like they’re sourced by direct traffic but are actually referrals, or some that seem like paid search when they actually heard about your company first on TikTok.

4. What is the current state of our data?

It may not be sexy, but it’s crucial to think about the current state of your data when selecting a lead attribution model. If you’re struggling to create dashboards that offer visibility into your current lead attribution, you’ll want to take a step back and design a simpler process to use as a foundation while you work on data structures.

After all, more complex lead attribution models require squeaky clean data. This can impact reporting, budgets, cross-functional communication, and more. If you need assistance, our fractional revenue operations team would be happy to perform a systems audit and help you refine your data.

5. What are our budget and resource constraints?

More complex attribution models require tons of resources. Whether you’re hiring a consulting firm or doing everything in house, it takes a lot of time to:

  • Build the model
  • Educate internal teams
  • Maintain the model

If you have significant resources to devote towards setting up lead attribution, feel free to choose a more complex multi-touch model. But if budgets are tight and you want to get the most ROI out of building something quickly, a single-touch model might be more appropriate.

Regardless of what you choose, outsourcing the strategy and development to a sophisticated consulting firm will help you make sure everything is designed to meet best practices and get the results you’re looking for. RevOps Automated is ready to step in and help regardless of which CRM or lead attribution model you choose. Have a conversation with one of our consultants here: book a call with a RevOps Automated consultant.

If you’d like to take a deeper dive into various lead attribution models along with step-by-step instructions for setting them up yourself, check out our complete guide to lead attribution.

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