5 Forces Driving Attribution: Why Digital Measurement Is Coming Of Age

It's been three years since "attribution" (defined as cross-channel measurement that goes beyond the last click) emerged as the next big thing in online marketing. Recognizing that "last-click wins" are insufficient for measuring the impact of display media, many saw attribution as the new standard for measuring media. 


Yet to date, very few brands are using attribution to measure and optimize online spend.  Despite the universal need for better metrics, most still rely on click-through rates, cost per click and direct cost per action to measure display media.  Greg Papaleoni, who develops analytics and insights for Yahoo!, sums it up well: "While full-funnel attribution is the future of digital media measurement -- it should be the present.  Advertisers who embrace it will enjoy a massive advantage over their competition." 

While adoption has been slow to date, it is accelerating due to the convergence of several factors.  Borrowing from Michael Porter's "Five Forces" model for analyzing industries, here is my take on the five forces that are driving digital media attribution:

1. Continuing shift of media budgets from traditional to digital 
While total U.S. media spend will grow only 3% in 2011, digital spend will grow 14%, surpassing newspapers as the No. 2 medium.  Accounting for almost 30% of daily media consumption, Digital spend will continue to outpace all other channels for the foreseeable future.

2.Resurgence of display advertising
Display media spend will grow 14% in 2011, outpacing 10.5% growth in paid search. While there are many underlying reasons (growing social, video and mobile consumption, better targeting, real-time bidding, richer formats, etc.),  the resurgence of display is driven by two primary factors:

*The maturing of search: There are only so many searches every day, and most marketers have maxed out their paid search efforts.  For the big advertisers, there are no more keywords to buy.  Incremental dollars will have to go elsewhere.  Display is the obvious choice.

*The return of branding: During lean times, online dollars focused on harvesting existing demand (i.e. search).  But as the economy recovers, brand-building is once again a strategic priority.  In the digital arena, display media offers the most efficient and scalable way to create demand for your brand.

3.  Increasing focus on accountability
While budgets may have loosened, the focus on results has not. Consequently, marketers are keeping a close eye on ROI.  With the ever-increasing need to produce measureable results, brands now require branding plus performance.  To measure brand-building media, we must measure engagement, not clicks.

4. Evolution of Web architecture
Forays by IBM and Oracle signal a new wave of convergence between IT and Marketing.  As the IT behemoths push marketing-technology solutions, CIOs are becoming attentive to the needs of the marketing department.  The deployment of data management and universal tagging platforms set the stage for new measurement tools to be deployed across the digital infrastructure.

5. The emergence of better attribution solutions 
While initial tools were expensive and limited in scope, a new breed of point-solutions (including Encore) are emerging, offering more effective, flexible and affordable insights. For a very small investment, advertisers can now have a more holistic view of performance of each media channel, vendor, format, placement and keyword.  Such insights are enabling advertisers to optimize media budgets, yielding 20-40% gains in ROAS with a direct ROI of 100% to 2,000%.

As the media evolves, so must the manner in which we measure it.  The rising tide of digital spend requires better metrics for measuring engagement throughout the funnel.  The emergence of new solutions, bolstered by growing support from IT, is paving the way for attribution to become a must-have for marketers of all sizes.

Matt Miller, senior vice president, strategy and analytics at Performics, agrees: "Attribution is one of the top priorities for our advertisers.  Our focus on attribution will only increase as advertisers implement strategies to maximize ROI across all channels."

6 comments about "5 Forces Driving Attribution: Why Digital Measurement Is Coming Of Age".
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  1. Sam Diener, May 18, 2011 at 9:53 a.m.

    Nice plug. It's going to be one of the smaller companies that come up with the solution ;)

  2. Kent Emeson from Adometry, May 18, 2011 at 3:03 p.m.

    We have the solution today for all size organizations, it's called Ad Analytics and you can learn more at Take a look and give us a call for more detailed information on how our dynamic fractional attribution model outputs our automated Optimization reports the provide recommendations for maximization of your marketing dollars.

  3. Steve Latham from Encore Media Metrics, May 23, 2011 at 11:32 a.m.

    @Kent - I think I speak for everyone when I ask that if you're going to use comment fields to spam readers, please add something insightful before doing so.

  4. Kelly Brough, May 24, 2011 at 1:20 a.m.

    Wow, what a phenomenal registration effort to post a comment. Mediapost, you might need to look closely at how the industry is moving and apply that to your site!

    @Steve, there's a key thing that I believe is missing for attribution to really come of age: a common understanding by everyone in the industry on definition and measurement. For those of us who have been here for a while, we've seen the introduction of a number of approaches to each metric until the industry settles on one. A big part of the early days of display advertising (back when it was still called Interactive Marketing) ... to be cont

  5. Kelly Brough, May 24, 2011 at 1:22 a.m.

    ... was not just to understand the benefits, which your post does well, but also to agree an unambiguous measurement of in this case attribution. It sounds really basic, but I know from my experience, that different organisations have different approaches to this metric.

    Thanks for raising the important issue. Well done.

  6. Steve Latham from Encore Media Metrics, May 25, 2011 at 2:25 p.m.

    @Kelly - thanks for the feedback. IMHO it's going to be very difficult for the industry to standardize on one model for attributing credit for assists. The value of an impression depends how engaging that particular ad is, and this will vary by format (flash, rich, video), size, placement and frequency. The value of a click assist will vary based on numerous factors as well.

    You can use the same data for 3 vendors' algorithms and get 3 different weighting conclusions, each of which is defensible. Unless IAB says "use this one-size-fits-all algo for modeling," it will continue to be both art and science. To be continued in a future POV :-)

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