The American Attribution Index: Using Attribution Management to Improve Media Mix Allocation

transcript

The American Attribution Index: Using Advertising Attribution Management

to Improve Media Mix Allocation

Thursday, October 1, 20091 PM EDT

Speakers: Adam GoldbergPurush Papatla

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Adam Goldberg, Chief Innovation Officer

Co-Founded ClearSaleing Inc. in 2006Columbus, OH

Started Google’s inside sales organization in 2003-2006New York City, NY

Started Actuate’s inside sales organization in 2000-2003San Francisco, CA

Worked for Oracle Corp. in 1998-2000 in Major Account SalesRedwood Shores, CA

Speaker and Trainer at events such as: (SMX), (SES), (DMA)

Dr. Purush Papatla

President and Founder; Vetra AnalyticsPublished in top-tier marketing journals

» Marketing Science» Journal of Marketing Research» Journal of Business Research» Journal of Retailing» Journal of Interactive Marketing

Clear’-Sale’ing (klir sāl ing) n. 1. an advertising technology and analytics company

2. the only effective way to manage an online advertising portfolio and increase profit (ROI) for online advertisers

v. 1. continually improving the ROI of online advertising campaigns

2. easily and transparently increasing sales and profits

CLEARSALEING DEFINED

The American Attribution Index: Using Advertising Attribution Management

to Improve Media Mix Allocation

Thursday, October 1, 20091 PM EDT

Speakers: Adam GoldbergPurush Papatla

EVOLUTION OF ATTRIBUTION MANAGEMENT

Last Click Even Exclusions Rules Based Mathematical

Poll Question 1

Currently, how are you attributing conversion credit to your various ad

sources?1. Last click

2. Other attribution method

The American Attribution Index (AAI) is the first-ever attribution management index that measures the relative effectiveness of each online advertising source and influence factor on consumer purchases and conversions.

THE AMERICAN ATTRIBUTION INDEX (AAI)

THREE SUBSETS OF AAI

» AAI: Aggregate Indices

» AAI: Vertical Industry Indices

» AAI: Company-Specific Indices

AAI AGGREGATE INDICES

The Aggregate Indices serve as important barometers of each advertising source’s relative impact and influence on consumers' purchasing decisions. Since they represent an aggregate measure across all industries and companies, the Aggregate Indices should not be used to make advertising allocation decisions for a specific company.

AAI AGGREGATE INDICES

The Aggregate Indices can be used, however, to gain strategic insight into the relative influence and trends of the respective advertising sources in general.

AAI AGGREGATE INDICES MAKEUP

Given that company size and level of advertising budget often dictate the range and mix of advertising sources employed, the AAI: Aggregate will be comprised of 3 sub-indices:

• Large Advertisers > $2M yr in online ad spend• Medium Advertisers $300K to $2M yr in online ad spend• Small Advertisers < $300K yr in online ad spend

* The size breakdown could change in the future

NO HYPOTHESIS

STATISTICAL MODELS & DISCRETE DATA ANALYSES

INFLUENCE POTENTIAL

RATE OF DECAY

ABANDONED PATHS

PURCHASE AND ABANDONED PATHS

1,300,000+

500,000+ Purchase 800,000+ Abandoned

STEP 1

» ClearSaleing and Vetra Analytics built several statistical models to evaluate visitor buying behavior using Purchase Path data collected by the ClearSaleing platform for a particular company.

STEP 2

» Next, the models were tested and calibrated against actual historical data to ensure that the models were able to perform well in capturing, explaining and predicting buyer behavior.

STEP 3

» The best model was then selected. Using the outputs of this model, channel-specific attributions were developed.

STEP 4

» Next, the channel-specific attributions were used to develop influence weights for each channel (advertising source), where the influence weight represented how much influence a given source had in affecting a visitor’s decision to buy or not buy.

STEP 5

» These four steps were then repeated for multiple companies in multiple industry sectors.

STEP 6

» The companies were then segmented based on several criteria, such as total ad-spend or the company's vertical industry.

STEP 6

» The influence weights were then aggregated across companies within a segment.

STEP 6

Segment-specific indices were then developed:

» AAI: Aggregate» AAI: Vertical Industry Indices

THE AMERICAN ATTRIBUTION INDEX

Poll Question 2

What challenges have you run into when trying to build an attribution model?

1. Our technology cannot track beyond the last ad clicked

2. We cannot build a sound mathematical model

3. We cannot incorporate offline, social media, and word of mouth advertising

4. All of the above

5. We haven’t tried to build an attribution model

ATTRIBUTES OF AD SOURCES Organic PPC CSE Email Display Affiliate Direct

Google Brand Google Content Froogle Newsletter Click Brand Affinity Program Direct

Google Non-Brand

Google Brand BizRate Offer Click Other Other

Yahoo Brand Google Non-Brand

Shopzilla Auto-Response Impression Brand

Yahoo Non-Brand

Yahoo Brand Nextag Impression Other

Bing Brand Yahoo Non-Brand

Shopping

Bing Non-Brand Bing Brand Other

Ask Brand Bing Non-Brand

Ask Non-Brand Ask Brand

Other Brand Ask Non-Brand

Other Non-Brand Other Brand

Craigslist Other Non-Brand

Google Other

Model Number Product Name Competitor General

FURTHER ATTRIBUTES OF AD SOURCES

INFLUENCE POTENTIAL of an influencer = f (# of exposures,

when each of the exposures occurred,

decay rate of the effect of exposures)

MODELING THE INFLUENCE POTENTIAL

HOW TO DO CALCULATION ON INDIVIDUAL PATHS

» Take weights of ad sources from pie chart

» Normalize the ad sources used in that Path to 100%

» Example ->

EXAMPLE OF NORMALIZING TO 100%

How do you see your company incorporating Attribution Management into your marketing decisions going forward?

1.) Build an in-house technical solution

2.) Purchase a third party solution

3.) Rely on your current agency or hire an agency

4.) Use the tools you have today

Poll Question 3

REGULAR ONGOING ACCESS TO AAI CRITICAL

» (1) the continual addition of more and more data from the new companies who join AAI

» (2) changes that occur in macroeconomic environmental factors

» (3) changes that occur in advertising options and measurement technology.

AAI UPDATES

AAI VERTICALIZATION TODAY

» eTail

» Finance

ANECDOTAL ’REASONS’ BEHIND THE RESULTS

» Why are there such differences in weights between companies that have different ad spend?

» Why does email and comparison shopping have such little influence?

» What changes do we expect to see as more company’s data is incorporated into the AAI?

AUDIENCE QUESTIONS

Questions?

www.searchmarketingnow.comwebcasts@searchmarketingnow.com

Adam Goldberg- www.attributionmanagement.com info@attributionmanagement.com

www.clearsaleing.com

Upcoming SMN webcast: October 13, PPC Negative Keywords: Maximizing the Positive

Effect