Scrutinising online marketing channels to avoid wasted digital spend is becoming a stronger priority for many across the thriving sector, but how far can the attribution model be warped and will the long-term brand impact that affiliates bring still be recognised?
As varying user behaviour can be spotted at each stage along the path to conversion, surely it makes sense to measure all channels according to the role they play? Is the wider practice of this a step towards a smarter and more refined attribution model? Or will this lead to a clash among parties wanting different structures?
Ex-Tradedoubler client services director, and now current global client services director at TagMan, Sandra McDill, said that according to Econsultancy, over half of attribution strategies still award full credit to the last click in the path to conversion, and for affiliates, this has always been the predominant model used by networks and agencies.
Shift in Technology Use
“Over the last year however there has been a significant shift in clients using technology like TagMan, to look at the full path to conversion data that better understands how different channels start and assist journeys, but receive no credit under the last click wins model,” McDill said.
McDill said that during her seven years at affiliate network Tradedoubler, there was often the perception that affiliates only convert sales on last click and any attribution model would significantly reduce commissions for affiliates and networks.
“However, as we know affiliates don’t fall into one bucket, and just as clients are getting more granular in examining their PPC and display campaigns, they too are breaking affiliates down into the categories of performance marketing they most represent, such as voucher, loyalty, price comparison and content etc,” she said.
“The result is that clients are realising that affiliates do contribute across the full path to conversion, and in some cases are the predominant assist in sales which may result in another channel converting.”
McDill said a number of clients have been testing and deploying alternative attribution models to reward all affiliates in the path to conversion, or to base their commissions on the model that best reflects their business.
She stressed that this does in no way mean affiliates will not be rewarded for a sale, and that it means affiliates will be rewarded for the sales they have been involved in where they previously would have been de-duped against.
Understanding Role in Path to Conversion
McDill said it also means that affiliates who tend to be at the start of the path to conversion are being recognised and rewarded either through getting a share of the commission, or by receiving investment for placements or CPA content to boost their performance.
“It’s important to note that not one size fits all for attribution,” McDill begins.
“While a best click model might work well for one fashion retailer, this does not mean it will be the best for another.
“That’s why using a ‘what if’ model to analyse how different attribution models would affect sales and ROI, is the only way to understand what would work best for you.”
McDill, who joined TagMan last year, said the key to success is visibility, ensuring that clients, networks, affiliates and technology providers are working together on building successful attribution models and continuing to test their effectiveness.
“The exciting part for affiliates is that for the first time they can really understand their role in the path to conversion to better understand how visitors behave on their site for that brand, and how they can influence the commissions paid to them across any attribution model,” McDill added.
“For clients, it means understanding where they have wasted digital spend, so they can invest in the channels, such as affiliate, which will increase revenues and ROI.”
Regional director at Tradedoubler, Dan Cohen, said the real value of any attribution model is being able to ‘gain truly actionable insight which supports decisive positive actions’, in conjunction with all channel partners, to optimise the user’s multi-channel marketing mix on the basis of the results.
“We welcome the wider adoption of attribution modelling by advertisers which further highlights that performance marketing channels don’t just drive the final click, but are critical influencers in the research phase of the consumer’s path to purchase,” Cohen said.
A Work in Progress
Media director at analytic data platform Teradata eCircle, Mark Ash, who previously worked at DoubleClick and the Progressive Digital Media Group, said it is readily accepted by advertisers that a more intelligent approach to understanding what influences the buying behaviour is needed, beyond the last cookie.
“I think it’s really great to see how technologies have evolved to meet the challenge as it is long overdue and its reliance on ‘last cookie wins’ has, I believe, held back the development of affiliate marketing, perhaps the most innovative digital channel we have,” Ash said.
“However, in my experience it is most definitely a work in progress.”
Ash said that affiliate categorisation must be undertaken ‘carefully’ as categorising all affiliate activity as a single type can be somewhat misleading. Rather than concentrating on the channel which affiliates drive traffic from, which can be wide ranging, Ash believes it is the message that needs to be categorised, not necessarily the affiliate entity; as the marketer needs to know the combinations of the types of marketing influences that are effective in driving a sale.
“What’s more, how should a click from a content affiliate be compared with a click from a cashback website?” Ash begins.
“Furthermore, the value of that click, in terms of influencing a user to purchase, is likely to vary from sale to sale. Strong data and strong statistical reasoning is needed to evaluate the relationship between a click and a sale. The influence of individual banner impressions and any other ad interactions all have an impact on a sale and should also be represented where possible.”
Flexible Models Needed
Ash said the point behind attribution is to take a wider strategic approach to find the ‘optimal combination of influences’ to drive a sale in the most efficient way possible –the combination of content, offers and marketing messages that a user consumed across the entire user journey to convince them to make a purchase.
Ash, who joined the US, 1979-founded business in 2012, said gaining a better understanding of more accurate attribution would benefit from a co-operative approach across the industry.
He said networks will need to adapt to be able to help support more flexible attribution models and offer a wider range of different types of marketing message tracking, as well as utilise their affiliates’ media resources more effectively.
“Attribution isn’t going to be easily solved overnight, those marketing influences that can be measured tend to be over-inflated and those that can’t have to be assumed and are often under-represented – that’s the bottom line,” he said.
“But being able to demonstrate value that affiliates can bring right across the customer journey, and highlight the positive long-term brand impact that affiliates can bring, will only help to increase the opportunities for everyone involved; so it is in everyone’s best interest to do it properly and bring the subject to a wider audience.”
Bird said he was also concerned having heard that some tag providers might be selling in their tagging solutions by promising retailers that they can help reduce the attribution towards the affiliate channel.
More Seats at the Table
“While I understand the logic, and why advertisers would be interested in this, I’m not convinced that the affiliate channel and larger affiliates have either been consulted, educated or fully considered when attribution rules have been implemented.”
Bird agreed that yes, ultimately it is the retailers choice how they decide to adopt attribution, but said if this is being done in a non-transparent way, publishers like Savoo need to be informed so they can decide to continue to support advertisers or not.
Further to this, Bird said the affiliate networks should have a seat on the table when these decisions are made – so the network can inform affiliates and explain the implications.
“Many networks employ junior account managers (which is fine), but not all of these account managers have the knowledge or education to deal with negotiating attribution on behalf of the channel. I believe all networks should have an attribution expert who can help to influence these decisions and educate more junior staff,” Bird said.
Bird, who was a former brand sales manager at Affiliate Window, said he would also challenge the tag providers to explain and solve how cashback and incentive sites operate under channel attribution.
“How can publishers explain to consumers who are expecting cashback or a number of incentive points, that they are no-longer eligible because the retailer doesn’t recognise the value they have played in creating that sale?” Bird said.
While Bird said TagMan’s attribution model is a good move; if the value is being attributed correctly, he said this should see higher spend with affiliates, but stressed that education and transparency is key.
“I’m all for rewarding affiliates throughout the purchasing funnel, but how does this work in practice or is this just rhetoric?” he said.
“Are retailers and tag providers banking on affiliates not noticing a 20% plus drop in sales? Are affiliates educated enough about how attribution really works and how it might affect their businesses and are retailers and tag providers also banking on this? I’d like to see tag providers really step-up with thought leadership working in conjunction with retailers, agencies and affiliate networks to offer education around these areas.”
In terms of how TagMan’s attribution model could affect Savoo and its affiliates, Bird said that if trust towards networks and retailers starts to diminish, this is ‘a dangerous thing’ in a world where other options are quickly emerging where publishers can monetise their sites – such as real time bidding.
He said affiliates are particularly vulnerable as they work on the CPA model, and therefore always run the risk of not making sales even though they drive traffic.
“I think you could successfully argue the case that advertisers should factor this risk into their attribution modelling, or compensate affiliates more through higher commissions if sales are being declined through attribution rules,” Bird said.
Understand What Needs to be Measured
Strategy director at Affiliate Window, Kevin Edwards, said splitting out affiliates by type is nothing new, this has been a mantra of the network for years, and ultimately what any client should be looking at is their top affiliates on an individual basis.
“Click involvement is just one metric that measures contribution alongside a complex collection of value sources such as latency, customer quality, new versus existing, average order value and repeat purchase,” Edwards said.
“It’s critical that clients understand that essentially what needs to be measured and rewarded is everything that happens around the click, not the click itself – this is no more an indication of value than any other single metric in isolation.”
Edwards, who previously worked at online marketing agency dgm, said taking a holistic, long-term view is the only way to get to the heart of what everyone is trying to understand – how significant numbers of consumers are interacting with various media.
He said only by weaving longer term value into initial click and impression contribution can we understand the incrementality of the channel.
“It’s certainly advisable that advertisers should want to understand contribution, but I’m fundamentally opposed to splitting commissions between affiliates; this makes very little difference and actually makes programmes more opaque,” Edwards begins.
“The wider value contribution piece should be the focus, informing advertisers of the true commercial value of each affiliate partner, thus incorporating assists within commissions.”
He said the data should be shared responsibly, as for far too long there has been a lack of transparency, which has fuelled a series of misnomers, that have now become ‘received wisdom’ within the wider affiliate community.
“Similarly this could help affiliates fight for non-CPA payments that recognise the branding contribution they offer; something we’ve also been championing through various methods, including tracking post-impression contribution in the background of some programmes,” Edwards said.
While networks have been aware of the client requirement to assist in attribution modelling, Edwards said a network cannot do this alone. He said fundamentally advertisers should not be looking at affiliate modelling in isolation and that other channels need to be assessed and this is where networks have been disadvantaged, unless a client is willing to share this data.
“There is no black and white, easy solution. There are variations between sectors and between affiliates so any approach and network advice needs to measured, controlled, tested and thoroughly assessed in order to ensure contribution is rewarded without negatively impacting both affiliate coverage and ROI,” Edwards concluded.
Can there be one unified attribution model to please all? Or are more bespoke strategies the only way forward? Comment below and let us know your thoughts…