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Multi-channel Consumption Becomes Standard

In our last blog post we discussed the challenges of conversion attribution in 2013. An important point of that post was how marketers should integrate conventional channels into their conversion attribution analysis. We talked about how consumers who are on their way to a conversion – whether it is a purchase, the conclusion of a contract – do not only do so via online channels. Even if the final step or purchase eventually takes place online. On the flip side, many conventional transactions do not solely come via classical marketing channels, as more and more consumers seek to inform themselves via online channels and have their interest piqued elsewhere.


The best way of allocating value is by combining conversion attribution and modeling

The best way of allocating value is by combining conversion attribution and modeling

A study about the customer journey typology 2012, carried out by the Institute for Retail Research in Cologne, the E-Commerce-Center for Retail, and AZ Direct (subsidiary of Arvato), confirms this well-known hypothesis. The results show that 90 percent of the population in Germany for example are multi-channel consumers. This means a conversion is driven by an impulse and information, and a purchase can happen in more than one channel. In Germany this typology represents the marketing and sales affinity of more than 70 million people. Some interesting findings of the study are:

  • 65% of the consumers inform themselves stationary and conclude the transaction online,
  • 65% of the consumers inform themselves online and conclude the transaction stationary,
  • 80% of the consumers inform themselves with catalogues and conclude the transaction stationary, and
  • 70% of the consumers inform themselves with catalogues and conclude the transaction online.

The findings of the study clearly show that a large part of the online conversions are influenced by conventional channels. Therefore, it is essential to include conventional channels into the online conversion attribution to better allocate budgets. In past blog entries we have said that there are two approaches to evaluate investments in the online sector: conversion attribution and modeling. Conversion attribution determines an advertising channel’s contribution to a conversion.

One particularly suitable model is QUISMA’s individual attribution model, as it helps advertisers to find out which channels initiate; which ones influence and which ones profit. Ideally, it lets you determine how much each channel contributes to the conversion goal. Having this knowledge lets marketers distribute advertising measures more efficiently in the online sector. Only channels that are often used by the target audience are taken into account. However: classical advertising measures are neglected.

This is where the modeling comes in – based on analysis – it allows a holistic optimization. This approach takes online as well as offline activities, such as TV and print, into account. The result is again a better distribution of the online budget. This approach also determines the impact of external factor on the conversion, i.e. the weather. The downside is that is does not evaluate individual journeys, therefore an automatic optimization of online campaigns cannot be guaranteed.

Both approaches have their advantages and disadvantages. You receive the best results if you combine conversion attribution with modeling. This way you can make sure that individual journeys and all marketing activities are fully evaluated. The goal of this method is to determine the best budget allocation for all marketing channels. The exact proceeding will soon be explained on this blog.

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