The difference between analytics and attribution

The difference between analytics and attribution seems to have become...murky! I'm not sure why. It's certainly a complex field with its fair share of concepts and protagonists.

But compared to some mystically blurry notions in digital marketing like the infamous 'adtech'/'martech', attribution and analytics have firm and distinct uses.

Let's start with simple definitions that clearly differentiate these two concepts:

Analytics understands what customers experience

Attribution understands the effectiveness of marketing

Analytics helps an e-commerce business measure how users interact with their online properties. The purpose of analytics platforms is to measure, understand and inform on customer experiences.

Attribution identifies patters and trends across marketing channels to measure the effectiveness of marketing. Its output is to show how valuable and influential a various marketing channels are to the customer's decision-making process.

We only need to consider the success of Google Analytics and a host of other third party platforms to know that online analytics is hugely important to the success of e-commerce companies. It informs decisions on all aspects of a business, including marketing, product, site optimisation and customer service. The value and practical uses of attribution are perhaps less obvious to all.

Let's look at a practical example. An online-only clothes retailer of trendy smart-casual garments that yours truly would never wear wants to optimise its offering to the 20-something market. This will involve a marketing strategy, product strategy and a commerce strategy. But before any of this is even a twinkle in the MD's eye, somebody will be given the task of using the company's analytics platform to look at how this customer group already interacts with the business. How do they find the website, do they like to use the app, which pages do they land/linger on and what do they buy at the moment? With this analytics information the business can be optimised to target its audience more effectively and improve their experience.

But while this optimisation is vital, the company also needs to increase its presence and engagement with its target audience. It needs to reach and impact them in greater number through better digital marketing. Enter attribution.

Attribution will help the business market to this audience more effectively. It will allow the marketing team to analyse what channels 20-something users interact with before reaching the site. And crucially it will tell the team what mix of channels the target audience typically uses to purchase. Let's say lots of 20-something users start their journey to the trendy clothes company in social, but also a significant portion interact with search before purchasing. Attribution analysis delivers the knowledge to optimise these channels, the data to indicate how spend should be increased and the insight to forecast how might other channels will be effected.

The most sophisticated digital marketers will use both an analytics platform and an attribution solution to unlock effective and efficient cross-channel marketing. Analytics brings the customer insight, attribution analyses the effectiveness of marketing to those customers. Used in tandem the results can be powerful and far-reaching.

However, lots of companies have made the mistake of investing in attribution solutions without the right preparation, and with their ducks strewn about in a drunken and disorderly row, hasty adoption has led to costly mistakes.

Here is a handy checklist to ensure you are ready for digital attribution:

Am I tracking all marketing data? End of funnel event tracking is the bare minimum, and nowadays normally too-bare, for attribution analysis to be effective. You need to make sure your business is tracking the interaction with all digital marketing all the way through from first impression to end conversion.

What do I want attribution to do? There is an attribution solution for every season! To select the right solution, you need to have a realistic appreciation of the business'  scale and clear deliverables in mind. Generally speaking, algorithmic attribution is our preferred method, but it needs a decent sized data set to be effective.

Do I have command of my budgets? There is no point implementing attribution programmes to realign how you spend your online marketing budgets if you can't realign them in the first place because you either don't have the time, can't take the risk or don't have the authority. There is no point running an attribution strategy if it doesn't drive results.

Do I know my costs? Understanding what it costs your business to acquire new customers and retain existing ones will be vital information when it comes to working with attribution. In fact, it's vital info for every digital marketer so if you don't have KPIs linked to cost then make this a top priority, regardless of whether you invest in attribution.

Be open minded and ready to change. Remember the purpose of attribution analysis is to provide insight that optimises the digital marketing mix. The analysis might show that spend is to the penny, highly effective and all that will go up is your salary.  But data-driven attribution algorithms are highly effective so chances are they'll help you to change elements of your marketing strategy. Embrace the change to achieve maximum results.