marketing analytics get to grips with attribution modeling · roi = (vcm – spend) spend...

C O N F I D E N T I A L

Marketing Analytics

Get to Grips with Attribution Modeling

Jonathan Isernhagen

EyeForTravel

Social Media & Mobile Strategies for Travel

3/18/2014


Get to Grips with Attribution Modelling Pinpoint What Really Influences Customer Behavior

1) What useful tools are available to help you accurately attribute

influence? How can you measure sentiment?

2) How do you communicate ROI for mobile and social back to upper

management?

3) Are you interpreting conversion cross platform accurately?

4) Is visual social media harder to measure than other forms?


Effective Influencers have…


• Appinions

• eCaim

• Empire Avenue

• Klout

• Kred

• mPACT

• PeerIndex

• PROskore

• Radian6

• Traackr

• TweetLevel

• TweetReach

• Twitalyzer

• TwitterGrade

Influence measurement vendors

[email protected] @jon_isernhagen www.linkedin.com/in/isernhagen

Brian Solis, http://www.briansolis.com/2012/03/report-the-rise-of-digital-influence/


The KPIs behind the KPIs

Influence KPIs:

• Brand Lift/Awareness: aided/unaided recognition of brand.

• Sentiment Shift: opinion movement from negative to positive

• Brand Resonance: how often is your brand discussed?

• Reach-through advocacy and Word-of-Mouth: virality

• Leads/Referrals: leads driven by promotions


Business goals of digital influence

• Boost brand awareness, leading to sales

• Attenuate brand scandals (e.g. “United Breaks Guitars”) by

pre-emptively co-opting some influencers, saving sales.






management?





ROI calculation/communication

Channel* Desktop Tablet Mobile

Brand 20%

Brand SEM 62% 51% 38%

Display -5% -12% -7%

Display - Retargeting 26% 25% 29%

Email 250%

Meta search 18% 22% 10%

Non-brand SEM -30% -18% -40%

SEO 500% 520% 390%

Social media -5% -15% 15%

- 7 -

*of impression/click, not necessarily of consumer conversion



Positive Return on Incremental Channel Investment

- 8 -

ROI = (VCM – Spend)

Spend

Abbreviation Term Definition

ROI Return on Investment Indicator of investment profitability.

Positive = good.

VCM Variable Contribution Margin The amount of profit driven by a

given transaction.

Spend Channel Spend The amount spent driving traffic to

the site during the period in question

Calculated over a specified time period of investment and return.




Spend

Spend

- 9 -

Which spend do you include?



Marketing ≈ Farming

1) Seed = impressions

2) Bookings = fruit

- 10 -

But….

marketers plant

& harvest constantly.


spend spend spend spend

How changes in spend can mess up ROI

- 11 -

$

time

profit

impact impact

spend

impact


Jan Feb Mar


Variable Contribution Margin (“VCM”)

- 12 -


Spend

1) What is the value of each transaction?

2) Which transactions go to which channels?



VCM

Transaction revenue minus variable non-marketing expenses:

• Revenue: –Supplier Commissions,

–GDS incentives,

–Overrides (lumpy: average/booking must be assumed)

–Media (not transaction-driven, but has to be modeled in somewhere)

–Attached bookings / Lifetime value: try to gauge value without double-counting

• Expenses: –Website hosting/capacity costs

–Data processing expenses

–Other expenses which vary by transaction or site activity volume

- 13 - [email protected] @jon_isernhagen www.linkedin.com/in/isernhagen


Which marketing treatment(s) triggered the purchase?

"Half the money I spend

on advertising is wasted;

the trouble is,

I don't know which half.“

-John Wanamaker

Father of Modern Advertising



“Hard to Know” ≠ “Random”

We may not find the correct answer, but the answer does exist.



• Sends

• Opens

Collecting the necessary data

Analysis

space

• Clicks

• Visitors

• Transactions

• VCM

• Media impressions

Site metrics tool

Back office system

• Channel-specific

phone #s

Email service provider

Call Center IVR

• Impressions

• Clicks

• Spend

Display ad server

e.g. SAS, Revolution Analytics,

SPSS, Teradata Warehouse Miner

SEM bid management tool

• Impressions

• Clicks

• Spend

• GRPs

• Spend

Television plan

• Impressions

• Clicks

• Spend

Meta search feeds

Spend

Manual spend entry table


Connecting the necessary data

Transactions Profiles Customers

Sessions

∞ 1 ∞ 1 Clicks:Transactions Clicks

∞ 1 1 ∞

∞ 1 ∞ 1

Calls

Sends

Opens ∞

1

∞

1

Email

IVR

GRPs

TV plan

Impressions

Ad server

Impressions

∞ 1

∞ 1

∞ 1

Back office Site monitoring tool CRM system

1 ∞







management?





Profile deduplication

Profiles Customers ∞ 1

CRM system


1) App registration information tied to desktop profile

2) Logged-in customer information on multiple devices

3) E-mails sent to same address opened on multiple devices

4) Third-party services with network visibility






management?





Social attribution requires impressions

Transactions Profiles Customers

Sessions

∞ 1 ∞ 1 Clicks:Transactions Clicks

∞ 1 1 ∞

∞ 1 ∞ 1

Calls

Sends

Opens ∞

1

∞

1

Email

IVR

GRPs

TV plan

Impressions

Ad server

Impressions

∞ 1

∞ 1

∞ 1

Back office Site monitoring tool CRM system

1 ∞



SocialCode clicks vs. impressions example

This example overcredits impressions (excludes other channels)

but it gives some idea of the sub-surface portion of the

impressions iceberg.


Facebook impression/click visitor id tracking

Visitor action Volume Trackable Useful

Ad link click Small Yes No

Sponsored news feed click Small Yes No

Organic click Small Yes No

Ad impression Large Yes Yes

Sponsored news impression Large No Yes

Organic impression Large No Yes

With one exception, what’s useful is not trackable,

and what’s trackable is not useful.


Forrester 2012Q2 survey of attribution vendors



Algorithmic attribution per Visual IQ: Top Down (MMO) & Bottom Up (Fractional Attribution)

25

SUMMARY LEVEL DATA USER LEVEL DATA

CHANNELS Offline + digital cross channel Digital media channels

ROLE Strategic: Optimize spend across channels

Tactical: Generates granular

media recommendations

OUTPUT Cross channel insight Full fractional attribution

CAPTURES Seasonality and external factors

Interplay between digital touch

point and channels

PREDICTABLE

GRANULARITY Conversions at aggregate level Propensity to convert at user level



“Given all the history we know, how likely is this shopper to convert soon?”

Datasong answers with a 2-stage model:

-Are Brand shoppers (BSEM, BSEO, DTI) likely to book? Yes

-Did your last TV spot cause their brand loyalty? Maybe

Algorithmic attribution per DataSong: Survival Modeling

Model 2 Accuracy 81%

Model 1 Accuracy 68%

0

0.5

1

0 0.5 1

NonConverters Converters

0

0.5

1

0 0.5 1




Algorithmic attribution per DataSong: Survival Modeling

1) Axes show the time since last channel exposure

2) Dots represent converters vs. nonConverters

3) Orange line represents the relationship between 2

variables, e.g.: a) time since last email and

b) time since last affiliate visit

4) Responders: everyone above the line. We count the

folks above the line and see what our accuracy is

5) Attribution: once satisfied with a model(s), we’d: a) take a given order,

b) see the time since last email and affiliate and based on

the timing, and;

c) where we are on the orange line, so;

d) we have a means to allocate which was more causal.

0

0.5

1

0 0.2 0.4 0.6 0.8 1




Survival Modeling: DIY

Recommended by one of our

PhD statisticians.

“SAS usage is not necessary.”


C O N F I D E N T I A L - 29 -

Algorithmic attribution per Google: Interaction Method (“Shapley value”)

Brand

SEM Email

2%

Conversion

Brand

SEM Email

3%

Conversion

Every combination (“coalition”) of clicks is tested.

“How important is each player to the overall cooperation?”

http://en.wikipedia.org/wiki/Shapley_value


Display


Running the process

1) For each site visitor a) Assemble visit history

b) Create variables to represent: i. Channel impressions

ii. Channel clicks

iii.Past purchases

2) Regress or use machine learning algorithm a) Ascertain which channel touches predict booking

b) Give VCM credit to causal channels

3) Calculate ROI a) Use each channel’s VCM and spend

b) Where ROI is positive, spend up

c) Where ROI is negative, cut spend or change tactics



Take-away lessons

- 31 -

1) Tie your social media investments to the bottom line. 1) Do the best attribution you have resources for

2) Be mindful of what data you’re leaving out

3) Click basis will undervalue social contribution

2) Experiment to discover each influencer’s value

3) If your data aren’t yet in shape to support attribution & other ad hoc analyses, get that project underway.



Top Social Media Sites

Site Focus/Description UVs/Month

Facebook Sharing blog postings, photos/videos, apps w friends 900M

Twitter 140-character micro-blogging, RSS, updates 310M

LinkedIn Business and professional networking 250M

Pinterest Online pinboard for organizing and sharing images 150M

Google Plus+ Social layer atop Google properties, authorship tool 120M

Tumblr Microblogging platform and social networking 110M

Instagram Square-shaped, filtered photo and video sharing 85M

VK Russian speakers’ Facebook 90M

Flickr Photo sharing, hosting, commenting, networking 65M

MySpace General: Photos, Videos, Blogs, Apps. 40M

Tagged Social discovery website for game/gift sharing 38M

Ask.fm Anonymous question/response site 37M

Meetup Offline meeting planning for various activities 35M

MeetMe Social networking/introduction site with games 10.5M

ClassMates Seek/connect w school, work, military friends 10M


Attribution options - broad view

Provider Method Cost

Timing Comments 1x monthly

Adobe Attribution model Varies - 4-10 wks Consulting arm willing to address attribution questions

as one-off modeling projects.

Adometry Econometric

model Low High 12 wks

Forrester-acclaimed industry co-leader.

Highly display-focused.

Datasong

Attribution model

w/

Customer

scoring

Med

Med

6 wks

Comprehensive model which pulls in both online and

offline spend impacts.

Med Per-customer demand curve to predict the expected

return on every campaign

Google

Analytics Interactions

model - - now

Has delivered digital-only channel interactions model

to beta clients.

Gauge LLC Simple

regression High - 10 wks

General consulting analysts, not on the efficient

frontier for this deliverable.

Kenshoo Unknown

algorithm - Med 4 wks

Primarily targeted towards SEM spend, but can be

expanded to comprise other digital channels

Visual IQ Econometric and

Attribution

models

High - 4-8 wks Econometric model. Offers cross-channel allocation

guidance, including offline spend.

Med-

High - 3-6 wks

Attribution model. Offers within-channel campaign-

level spend guidance. No offline.

marketing analytics get to grips with attribution modeling · roi = (vcm – spend) spend...

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