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Attribution Methods: Time of Conversion vs. Time of Touchpoint

Time_of_Touchpoint-1
31. 01. 2018

Marketing attribution is a complex issue: Attribution allows marketers to prove how successful their campaigns are and how they can also better classify and manage future advertising measures and budgets.

But besides the actual attribution models (such as Last Touch, linear, data-driven, etc.), that use different methods to assign credit to previous user touchpoints, the time of success is just as important and provides further complexity. In this blog post, we want to discuss the various methods and explain the advantages and disadvantages of both perspectives.

 

TIME OF TOUCHPOINT VS. TIME OF CONVERSION

When assigning conversions to the respective marketing touchpoints there is not only one truth. Countless attribution models report different results and show varying views on success. But that's not all. Besides the actual attribution model, there are also various attribution methods that allocate conversions to different times. Here, we differentiate between the time of conversion, i.e. the time when the sale actually took place and the time of touchpoint where the conversion is counted back to the time of the marketing touchpoints.

Example:

A conversion is usually the result of several customer touchpoints with the brand prior to the purchase. These touchpoints are displayed chronologically in a customer journey.

The following customer journey consists of five touchpoints. Three of them (TP 1, TP 2, TP 3) already took place two days before the conversion, one the day before (TP 4) and another one on the same day (TP 5), shortly before the conversion was completed.

 

 

All you need to know about Marketing Attribution

 

With the ‘Time of Conversion’ approach, the conversion is allocated to the actual time of conversion, i.e. Day 0. It doesn’t matter which type of attribution model was used and which touchpoint led to the conversion. Here, the success is always measured at the time of sale.

Not so with the ‘Time of Touchpoint’ approach. Here, the success is allocated to the time of the marketing touchpoint. If the customer journey consists of more than one touchpoint (as in our example), the success is distributed to the point in time of each individual touchpoint.

 

The ‘Time of Touchpoint’ approach offers an alternative view of the attribution. The ‘Time of Conversion’ aggregates the entire conversion to the day of conversion. The ‘Time of Touchpoint’ view, on the other hand, distributes the individual conversion across each day a marketing touchpoint occurred. By assigning the above conversion to the respective points in time according to the logic of both methods, you get different results.

Day Conversions according to Time of Conversion Conversions according to Time of Touchpoint
-2 0 0.6
-1 0 0.2
0 1 0.2

 

WHY ARE THERE TWO DIFFERENT PERSPECTIVES?

The Time of Conversion method is the traditional perspective. It can easily be combined with the Last Touch model. Here, the ‘winner’ touchpoint usually takes place on the day of the sale, which means that marketing touchpoint and conversion happen on the same day. This static model creates metrics that are easy for advertisers to compare. This approach is ideal for advertisers that want to find out more about their sales or compare different partners using sales metrics.

The Time of Touchpoint approach is suitable for cost comparison and efficiency assessment. The costs are distributed to the times of the marketing contacts. This perspective is vital as not all costs actually lead to a sale. Costs are allocated to the moment when they actually arise. In a CPC model, for example, this is at the time of the click. If the conversion is now aggregated to the same period in which the costs for this conversion took place, you end up with more precise figures for the CPO (Cost per Order) or ROAS (Return on Ad Spend) calculation. This approach considers the actual costs leading to the sale. It provides more transparency and makes costs as well as generated revenue more scalable and easier to compare. 

Many users take several days to decide before they make a purchase. Therefore, the Time of Touchpoint approach is more precise when it comes to budget planning and value contribution.

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