Revenue Attribution in Marketing and Sales Analytics with Steffen Hedebrandt
In this episode we go deep into revenue attribution with Steffen Hedebrandt, chief revenue officer and cofounder at Dreamdata.io in Copenhagen, Denmark, an expert in digital revenue attribution, purchase intent and user tracking.
But before we get into the interview, here are some revenue attribution basics…
What is Revenue Attribution?
Revenue attribution is the aspect of marketing and sales analytics that allows businesses to understand how different digital touchpoints contribute to revenue generation. It involves identifying and assigning value to each interaction a customer has with a company, helping organizations optimize their marketing funnel so they can allocate their resources efficiently.
Revenue Attribution Models
To excel in revenue attribution, marketers need to employ advanced analytics tools and platforms, align with their sales teams, and stay up to date on industry trends. Revenue attribution requires an understanding of data analysis, customer behavior, and marketing strategy. The best revenue attribution models help businesses allocate their budgets, improve their ROI, and make data-driven decisions for growth marketing.
- First-Touch Attribution: This model attributes all the revenue to the first interaction a customer had with the company. It’s valuable for understanding how initial marketing efforts contribute to conversions.
- Last-Touch Attribution: In contrast to the first-touch model, this one assigns all revenue credit to the last interaction before a conversion. It’s useful for recognizing the final touchpoints that directly lead to a sale.
- Multi-Touch Attribution: This model is more complex and assigns value to multiple interactions throughout the customer journey. It acknowledges that customers often interact with a brand multiple times before converting.
- Linear Attribution: Here, revenue credit is distributed evenly across all touchpoints in a customer’s journey. It provides a balanced view of how each interaction contributes to the final outcome.
- Time-Decay Attribution: This model assigns more value to interactions that occur closer to the conversion point, recognizing that some touchpoints have a more significant impact as the purchase decision nears.
- Custom Attribution Models: Many businesses create their own attribution models tailored to their unique customer journeys and industry-specific factors.
About Steffan Hedebrandt
Steffan serves primarily on B2B digital marketing agencies. His services help clients nurture leads through the sales cycle to a decision point, which hopefully results in a sale. As a result, he thinks a lot about keyword intent. The specific term someone searches says a great deal about there likelihood to complete a purchase. And this interview, he shares his formula for keyword intent strategy.
Does a lot work helping SaaS companies with 15-500 employees. He targets marketing directors and says direct sales in the fastest channel. Or you can try to capture the highest intent by purchasing traffic from very specific channels like Capterra or G2, where visitors are very far down the purchase funnel, essentially comparing competing services to each other, which is among the strongest indicators of intent to purchase because the buyer has already invested a lot of time and energy into researching a product category.
Anonymous vs. Authenticated User Tracking
Marketers are starting to appreciate the difference between anonymous and authenticated user tracking. Anonymous user tracking platforms like Google Analytics track devices, rather than individuals. That means Google Analytics is limited in its ability to understand behavior, since the same customer journey can span a variety of different devices.
To get more customers, you need to understand the entire journey from start to finish and not just the last click. Google Analytics attempts to she light on the journey with its Multi Channel Funnel Assisted Conversions report, but its accuracy is limited by user anonymity. Customer data platforms, on the other hand, use email address to circumvent double counting the same users on different devices. Customer data platforms and CRMs are ways to count authenticated user activity, which is always going to be more accurate.
Generally speaking, for impulse purchases, direct to consumer purchases, or any other purchase where the cell cycle is relatively short, Google analytics offers all sorts of great insights for increasing conversions. However, if on the other hand you are a B2B assuring prospects through the sales cycle, the information from Google analytics is probably going to be a bit more scattered and less useful.
We also spoke about the previous podcast interviews I recorded with Justin Cutroni, who at the time was independent but who currently works for Google. Most advertising platforms use tracking parameters to minimizes the number of users who are tracked as “direct” visitors. One way to make sure your links don’t register as “direct” is by using the Campaign URL Builder tool to assign UTM parameters to your links.
Monitoring Email Marketing Campaigns
Email marketing metrics are not what they used to be. Cybersecurity software monitors inbound emails, sometimes triggering what looks like an email open, but in fact was not. If you want to be sure that someone actually opened your email, you want to see a minimum of two opens. That way you know it was the person who opened the email, and not software scanning inbound email messages prior to distributing them to the recipient. Better yet, use click thrus and responses as a more accurate measure of engagement. For more on email marketing best practices, check out my Email Marketing Guide.
If you’d like to get a look a look at the Dreamdata.io customer data platform, reach out to Steffen for help with solve their multi-touch attribution challenges and they work particularly well with companies using best-of-breed stacks. In the tradition of product-led marketing, Dreamdata has a free tier you can play around with to see if it’s a fit for you.
Dirty Little Secret about Revenue Attribution
In the intricate world of revenue attribution, there exists a pervasive challenge that often goes unspoken in vendor discussions (Steffan and I did not discuss this) — the issue of platforms aggressively vying for credit and, at times, even doubling down on attribution.
This “dirty little secret” reveals that advertising, social media marketing, and email marketing platforms are not always forthcoming about their role in conversions. It’s not uncommon to witness two or more platforms claiming the same revenue, which can muddy the waters of accurate attribution.
The challenge at hand lies in unraveling this complex web of attribution to ensure transparency, fairness, and a more realistic understanding of each platform’s contribution to conversions. Effective data collection methods, unbiased attribution models, and a critical eye toward the credit-taking tendencies of platforms are essential to navigate this unspoken challenge in the world of revenue attribution.