media attribution: optimising digital marketing spend in financial...
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Media attribution: Optimising digital marketing spend in Financial ServicesA multi touch attribution study on the role of Facebook, display and search marketing in Financial Services.
Executive summary
Marketers have been applying
science, specifically statistics and
econometric modeling, for many
decades now to answer the key
question all advertisers face - how
to allocate media budgets across
channels to maximise overall return
on advertising spend (ROAS) with a
limited budget.
Unfortunately, when it came to digital marketing, the same rigor was not applied due to a lack of reliable data as well as focus from top executives.
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Whilst the data has improved and digital is now an indispensable part of any marketer’s channel mix, many brands still rely on inaccurate attribution methods.
The most prevalent, last-click attribution, gives all conversion credit to the last campaign touch point in the purchase path thus ignoring the value of all other digital advertising that contributed to the conversion.
Unchallenged for many years, it has led to an outdated and biased view of the digital landscape.
Media attribution solves the key question every marketer faces - how to split my media budget? It delivers significant ROI and can even turn into a tangible long-term competitive advantage for brands.
“
”
Christian Bartens, CEO, Datalicious
ACROSS 5 MONTHS
= ROASA N D 7 B R A N D S
104 million
75,000
P U R C H A S E PAT H S
C O N V E R S I O N S
The study summarizes the results of the analysis of:
This study seeks to understand the true impact of digital channels for financial services companies in Australia.
Using a multi-touch attribution approach, the study summarizes the results of the analysis of 702 million media touch points across 104 million purchase paths and 75 thousand conversions across five months and seven brands.
Compared to last-click, multi-touch attribution uses logistic regression to assign custom conversion credits to every campaign touch point along the purchase path depending on its relative importance in driving conversions thus not undervaluing any particular channels.
702millionMEDIA TOUCH
POINTS
Executive summary
The key findings of the study are:
Facebook and display advertising are significantly undervalued and on
average deliver 830% more revenue than anticipated once measured
accurately with multi-touch attribution.
Given most advertisers have very mature search marketing programs
that o�er little opportunities for additional incremental growth, display
advertising in general represents one of the most attractive growth
opportunities.
Facebook advertising in particular still holds significant growth potential
compared to other more established channels as it provides a high
average ROAS yet comparatively does not receive a lot of media spend.
While Facebook and display advertising do generate clicks, they are
not typical direct response channels, but instead indirectly influence
conversions and build awareness that is then captured further down the
purchase path by other channels such as search.
Search, whilst important in capturing awareness generated by display
advertising or other channels, is overvalued in the amount of impact it
has on the consumer purchase decision.
Accurate multi-touch measurement and the ability to exploit the resulting
media optimisation opportunities at scale holds tremendous potential for
advertisers to develop a strategic competitive edge, build market share
and deliver incremental growth.
03
TYPICAL CHANNEL ROAS COMPARED TO SHARE OF MEDIA SPEND
Typical share of spend
Typical ROAS (Multi-touch
attribution model)
LOW HIGH
HIGH
Display retargeting
Display Facebook
Other display
Paid search (SEM)
Contact us for actual ROAS dollar figures for a particular channel.
When switching from last-click to
multi-touch attribution, the revenue
credited to Facebook and display
advertising on average increased
by 830% while at the same time
the revenue credited to paid
search (SEM) and organic search
(SEO) remained fairly constant or
decreased slightly.
Search is the most common customer touch point just prior to purchasing a financial product online, which means the majority of conversion credits are usually attributed to search in a last-click attribution model.
However, in reality there are more channels than just search involved in driving a conversion. Specifically channels such as display advertising that help consumers realise a need by building awareness and stimulating research, which ultimately result in a search.
Given these channels occur further up the purchase path and do not necessarily generate clicks they are undervalued in an attribution model that gives all credit to the very last click.
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Compared to last-click, the multi-touch attribution used in this study uses semi-partial correlation to assign custom conversion credits to every campaign touch point along the purchase path depending on its relative importance in driving conversions thus not undervaluing any particular channels.
Once an accurate multi-touch approach is implemented it shows a clear shift in conversion credit and revenue attribution between channels whilst the overall revenue generated by all digital channels remains constant.
Paid search (SEM) can no longer claim credit for most of the generated revenue and has to start sharing with other channels such as display that previously were not able to claim revenue due to an inaccurate measurement approach.
Display retargeting as a channel performs exceptionally well as expected given consumers have to have shown a previous intent to purchase by visiting the advertisers website in order to be included in retargeting campaigns.
Key study finding #1:
Display advertising is undervalued in a last-click attribution model
SWING IN REVENUE BY CHANNEL
DISPLAY RETARGETING
DISPLAY FACEBOOK
OTHER DISPLAY
PAID SEARCH (SEM)
DIRECT
OTHER REFERRALS
ORGANIC SEARCH (SEO)
% change in revenue multi-touch attribution vs last-click attribution
2371%*
911%*
749%*
830% average}3%
2%
-3%
-10%
-25%
* Note: The percentage increase for display channels is so significant because these channels basically did not receive any credit at all in last-click based attribution model hence the swing compares the new (multi-touch) figures to a very low (last-click) base.
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Key study finding #2:
Facebook and display advertising boost searches and conversions
CONVERSION RATE UPLIFT FROM MULTIPLE DISPLAY AD IMPRESSIONS
FACEBOOK AND DISPLAY AD CLICK RESPONSES COMPARED TO SEARCH RESPONSES
Uplift in conversion
rate
Facebook Other display
7.167.18
While Facebook and display
advertising do generate clicks,
they are not typical direct response
channels, but instead indirectly
influence conversions and build
awareness that is then captured
further down the purchase path by
other channels such as search.
It is impossible to prove with statistical certainty whether display advertising leads to searches, however while comparing thousands of converting and non-converting purchase paths across millions of campaign touch points, we have found some very strong circumstantial evidence that that is indeed the case.
If Facebook and display advertising were similar to search and had no significant impact aside from generating clicks, then we should not be able to observe a connection between increasing number of ad impressions (without clicks) and an increase in conversion rate.
However, the study shows that for both Facebook and display advertising, the more ad impressions (without leading to clicks) consumers are exposed to the more likely they are to convert – over 7x more likely in fact.
Once we accept that display advertising does not only generate clicks but also indirectly increases conversions and thus searches which are the most common touch point just prior to converting online, then we can argue that display ads lead to 9x more search responses than clicks alone.
Apart from the obvious consequences for revenue attribution, this also has significant impact on creative optimisation, as the standard ad click-through rate alone cannot be considered a strong enough metric any more to evaluate creative performance.
Display preceding (& leading to) search
9.44x
Display clicks only
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Key study finding #3:
Actioning multi-touch attribution insights improves overall ROAS
Actioning multi-touch attribution
insights at scale holds tremendous
potential for advertisers to improve
ROAS across all channels and thus
to develop a strategic competitive
advantage, build market share and
deliver incremental growth.
The study not only gives considerable insight into the true performance of digital advertising channels for financial service organisations, but also provides a basis for renewed thinking in terms of digital strategy and media planning.
While it is impossible to say exactly how much the study participants will be able increase their performance by actioning the insights gained from this exercise, it is certain that the impact will not be insignificant.
Any channel that is potentially undervalued by over 900% in terms of revenue contribution just because of faulty measurement represents a significant opportunity in times of shrinking marketing budgets and constantly increasing competitive pressure.
Both the earlier attribution model comparison as well as the ROAS results by channel, clearly demonstrate that display advertising is undervalued in the financial service industry.
Facebook advertising in particular still holds significant growth potential compared to other more established channels as it provides a high average ROAS yet comparatively does not receive a lot of media spend.
Display retargeting performs exceptionally well as expected, however remains di�cult to scale given consumers must have previously exhibited the intent to purchase.
In the end it is all about achieving the right channel mix and multi-touch attribution helps to identify the roles that di�erent channels play in the path to purchase which is invaluable in developing an e�cient, scalable and profitable digital media strategy.
While search is e�cient in capturing demand it is not necessarily generating it, whereas display advertising is a powerful tool to build awareness, consideration and purchase intent.
TYPICAL REVENUE SHARE AND SHARE OF AD SPEND BY CHANNEL COMPARED TO ROAS
Typical ROAS (Multi-touch attribution model)
Bubble size indicates typical share of Ad spend
Typical revenue share
(Multi-touch attribution
model)Paid search (SEM)
Other display Display FacebookDisplay retargeting
Organic search (SEO)*
Email*
Other referral*
* Note: The study participants did not provide costs or media spend figures for organic search (SEO), referrals or email so ROAS figures could unfortunately not be calculated. The results of these channels are also likely heavily influenced by brand equity created elsewhere - most likely through advertising in o�ine media channels that could not be measured as part of this study but tend to generate organic searches as a response.
TYPICAL SHARE OF AD SPEND BY CHANNEL COMPARED TO ROAS
Typical share of spend
Typical ROAS
(Multi-touch attribution
model)
Display retargeting
Display facebook
Other display
Paid search (SEM)
Research partnership
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About Datalicious
Datalicious is a full service analytics
agency providing client focused
solutions designed to scale with any
organisation.
From our beginnings as an analytics consulting agency in Australia, Datalicious has expanded globally through our growing product and services divisions and help our clients around achieve data driven marketing best practice.
Datalicious is part of the Veda Group.
This research study was
commissioned by Facebook,
however all areas of the study were
ultimately designed, managed and
delivered by Datalicious.
Facebook had no involvement in the
data collection, development of the
multi-touch attribution methodology
or analysis and interpretation of the
results.
Facebook has not been provided
with the results of any individual
advertiser, publisher or search
engine provider.
It is fabulous to see advertisers increasing their sophistication in reviewing the effectiveness of their media spend. A recent study conducted by IAB Australia indicated that only a quarter of buyers are using multi-touch attribution analysis and still put way too much weight on last click or clicks overall. This study shows a positive impact across the variety of digital ad channels that were used and will help marketers start optimising campaigns based on creative exposure as well as any direct interaction.
“
”
Gai Le Roy, Head of Research, iAB.
Contact us to discuss how accurate multi touch attribution insights could benefit your organisation.
Research methodology
Media attribution: A scientific
approach to understanding ROAS
The Datalicious multi-touch attribution approach uses semi-partial correlation to compare converting and non-converting paths in order to assign custom conversion credits to every campaign touch point along the purchase path depending on its relative importance in driving conversions.
Simply speaking, channels that appear more often in converting paths than to non-converting paths receive a higher weight, which in turn allows them to claim more conversion credits and thus revenue. The higher revenue attributed to these channels then allows them to better offset the costs associated with the channel leading to a higher return on adverting spend (ROAS).
The figures presented in this study are based on hundreds of millions of observed data points and thus deliver a much more accurate and scientific measure of true attribution compared to the typical scenario or econometric modeling based approaches (which are usually based on significantly less data points).
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However, the study results are an average across multiple clients in the financial service industry and may vary for your own company and vertical so we highly recommend you implement your own multi-touch attribution for the best possible results.
Furthermore, given there is hardly ever a single solution to a problem simply increasing Facebook or display advertising spend is not going to be enough. Like any other channel a successful campaign strategy does not only depend overall budget but also requires a good offer, effective creative and ongoing test and optimisation program.
Finally, even though paid search (SEM) is likely overvalued that does not mean it does not work and should be switched off. It simply means the overall spend is not necessarily justified by the returns so optimisation and creative ways of reducing costs are required to again increase ROAS, The same goes for Facebook ads and display advertising that already have a positive ROAS - with a bit of optimisation the overall ROAS can be boosted even further.
ATTRIBUTING CREDIT
$100
$100
100%
Y% Z%
Last-click attribution
Multi-touch attribution
SEMI-PARTIAL CORRELATION COMPARING CONVERTING AND NON-CONVERTING PATHS
TOUCH POINT 1
TOUCH POINT 1
TOUCH POINT 1
TOUCH POINT 2
TOUCH POINT 2
TOUCH POINT 2
INFLUENCER INFLUENCER CLOSERINTRODUCER
TOUCH POINT 3
TOUCH POINT 3
TOUCH POINT 3
TOUCH POINT N
TOUCH POINT N
TOUCH POINT N
$
X%
Click here to learn more about our study methodology.