Whatever the Attribution Approach, Cross-Platform Limitations Still Abound

Leon Zemel – Chief Analytics Officer / [x+1]

As chief analytics officer of data management platform (DMP) [x+1], Leon Zemel oversees a host of client-facing marketing practices including campaign management, optimization and business intelligence. Zemel spoke with eMarketer’s Lauren Fisher about marketers’ frustrations with cross-channel attribution and shared insights into the benefits and limitations of taking either a top-down or bottom-up approach to attribution.

eMarketer: What are some of the larger industry trends you’re seeing surrounding marketing attribution?

Leon Zemel: We definitely see marketers demanding attribution, but they are struggling with it. There are two main questions people are trying to answer with attribution, and that can create some confusion. One is more of an investment question: “Should I put my money into search, display or even offline vs. online?”

And then they want to know about the optimization level of attribution, which is a much more user level or placement level. About that, marketers are asking, “Should I switch money on my media plan between this publisher and that one, or move more money to video or social from display?”

There’s a lot of pent-up demand to try and do it better, but I think the baseline ability to perform attribution—just in terms of actually being able to connect a conversion or some user action back to marketing—has become more challenging. And maybe that’s the reason we’re still seeing many marketers just trying to even figure out last-click or last-touch attribution, particularly as more channels have come about.

“I don’t think any marketers are happy with using a last-touch approach, but they’re still struggling to move beyond that.”

I don’t think any marketers are happy with using a last-touch approach, but they’re still struggling to move beyond that for a few reasons.

eMarketer: What are some of those reasons?

Zemel: One of the issues is that as you’re looking at more sophisticated attribution approaches to answer that first question of investment, like a marketing mix model, timeliness becomes an issue. Many of the marketing mix [model]-type methods take a long time to develop and to get the data together, and if a marketer is building a very complex model, it might take too long to begin to gain learnings on a campaign.

Oftentimes, marketers might not be able to get the full results until the campaign is over. That doesn’t do much good, unless you’re a marketer with a very long, stable, ongoing campaign.

Digital itself has its own unique challenges, compared with traditional channels like TV. TV is outbound—it’s marketing only. But digital is both an outbound marketing channel and an inbound fulfillment channel because people will use search to get to a client’s website and use the client’s website to convert, which may or may not have anything to do with marketing. It may just be a fulfillment vehicle.

Because of this, you often see companies that come at attribution from an offline perspective, which falls short in the digital realm because some of those marketing mix approaches don’t give you insights into the levers you can pull in digital channels. This is a big disadvantage to digital marketers, which rely so much on optimizations happening by publisher, placement and keyword.

In this regard, a last-touch model actually offers greater insight into those types of optimizations than a top-down model can. Last-touch can tell them that this placement is better than that one, or this keyword is better than the other. So you’re still seeing marketers and agencies forgoing a more sophisticated approach in order to do that.

What most realize though is they need to figure out how to glue both the top-down, marketing mix and the bottom-up approach together.

eMarketer: In terms of branding vs. direct-response advertisers, are you seeing a preference for either using a marketing mix model or path analysis?

Zemel: Yes. The brand guys tend to go more from a top-down, marketing mix model investment level, and the direct-response guys are more on the bottom-up, user path level. But I will say even the direct-response people who are taking a path analysis approach do want to make sure it bubbles up into a broader marketing mix model.

Traditional brands definitely tend to be happy with their marketing mix models because that’s the way they’re used to running things, but we do see some brands beginning to break out digital into separate channels so as to be able to better optimize their digital efforts.

“We’re seeing an increased number of brands looking to break up digital between things like search and display.”

eMarketer: So a marketing mix model might just treat digital as a single channel, meaning search, display and social would all be rolled into one broader digital channel?

Zemel: Sometimes, yes. This happens when there is an issue with not having enough of the investment mix coming from digital. If we talk about verticals like consumer packaged goods, for example, digital is still a very small percentage of their budget, so it’s really difficult to isolate the effects of individual digital channels. We’re seeing an increased number of brands looking to break up digital between things like search and display.

eMarketer: Given that the bottom-up approach focuses so strongly on cookies, do you foresee any future challenges for this type of attribution model, particularly in light of some of the privacy-specific rumblings surrounding third-party cookies?

Zemel: I don’t know if anything is imminently going to happen, but you definitely see big players like Facebook, Google and Microsoft trying to come up with their own sort of first-party cookie approach. That might be the future at some point. In 2014, we might begin to see more publisher networks that have first-party cookie relationships.

eMarketer: How might this affect [x+1] and other DMPs that are used to working off of third-party cookies?

Zemel: It would create a whole process and infrastructure requirement in which DMPs will have to create a matching network with these companies in order to match to the first-party cookies. DMPs are in a good spot if first-party cookies do take off, because DMPs today match between a client’s first-party cookies and their own third-party cookies.

So it’s really just expanding on that practice. What it might mean, though, is that a DMP might not have 100% coverage if a particular publisher doesn’t want to be a part of its network.

Courtesy of eMarketer