The Multi-Channel Consumer & Their Influences To Purchasing

A few days ago I gave a presentation at workshop at Strathclyde University's Business School on the subject of 'The Multi-Channel Consumer & Their Influences To Purchasing'.

I do expect to go into my presentation in more depth over a series of subsequent posts here, but in the meantime I thought I would share it here:

Hayden 26feb2013-final from Hayden Sutherland

Obviously this deck does need a bit of a voice-over to explain what some things mean, but hopefully it should be of some use... Especially to those who attended.

Presenting attribution correctly

Today I was not only lucky enough to be invited along to the Strathclyde University Business School's workshop on Big Data and Social Media... I also presented on one of my favourite topics:

The Multi-Channel Consumer And Their Influences To Purchasing

One of the hardest things I wanted to show was the different paths that consumers take on their multi-channel paths to purchase.

This journey (albeit just for one customer) is quite difficult to depict in a linear way and in the end I resorted to showing all the channels as a set of swim-lanes. In the photo taken above, you will see me in the middle of my presentation trying to explain the concept.

I hope the audience understood what I was trying to say.

Multi-channel digital attribution – what's next?

If you had read the recent eConsultancy report called‘Making Sense of Marketing Attribution’, you would know that the majority of websites are either not carry out any form of attribution or are still apply a last click approach. In this report the client-side marketers responding said that only26% were doing marketing attribution beyond last click … where the last channel used gains all the credit for the acquisition.

The online sector has been gradually moving towards digital multi-channel attribution, although it is still early days. The aim of these efforts is to understand the different online channels or touch points used by customers in their online paths to conversion on eCommerce sites, but:

• There is still little maturity of the attribution market, meaning there are several bespoke offerings and no real common standards between suppliers

•  The current attribution methods used are basic in their mathematical modelling

•  They are online-only, with no consideration for other non-digital channels (e.g. TV or outdoor)

In my experience, there is very little being done to look at the bigger picture that appropriately considers not just the journey and interactions across the disparate online channels, but also the offline ones…and it is here I think there is an opportunity.

I really think that businesses and their agencies need to move away from single channels of data (e.g. website analytics. TV viewing figures, etc.) and also beyond the basic online only attribution models. They need to understand the entire user journey that leads not just to a transaction, but to a longer-term relationship. Only then can business truly understand the influence that different devices, channels, proportional activity and other factors (such a peer recommendations) have on purchasing and subsequent behaviour.

Still doing basic online attribution?

Online attribution? Well, imagine you have a transactional website and you didn't know which digital  channel was responsible for each of your goals or conversions (e.g. sales) . Finding a way to 'attribute' specific actions to specific marketing channels gives you a better understanding of how and where to spend your budget.

Currently a lot of website analysts and digital marketers apply a ‘last click wins’ approach  to measuring goals. This is where the last channel used gains all the credit for the acquisition (this could be: an online advert such as Google’s AdWords, a paid for link on a partner website, a targeted email, a review site looking to get affiliate revenue for a referral, or a listing in search engines , etc.).
Why do they do this? Well it is what your typical online analytics tools provide you out of the box and therefore it easy to understand and manage.
Note: Others actually apply a 'first click wins', which means awarding conversions to clicks that have not actually produced conversions... or in other words, not rewarding the last channel that did!

However some sites are now applying slightly more complex attribution models, to try to give some credit to the overall purchasing process and not just one click. Some apply an equal weighting to all the known/recorded‘ touch points’ or alternatively and with slightly more complexity they apply a simple gradual increased weighting up to the moment of purchase. These methods of equal attribution and escalating attribution both have their plus points (they are quite simple to measure and calculate) and their drawbacks...with the obvious caveat being that none is really a true picture of the value added by each online customer interaction.

The problem with collecting data

Data gets collected all over the place these days:

• Customer feedback questionnaires regularly request and assess views and opinions
• Website analytics capture everything from machine preferences through to individual clicks on each page
• Audience research shows the number of adverts watched in a single evening and the retention of those products the following day.
• In-store ethnographic research identifies trends in purchasing behaviour and the effects of pricing, product selection, promotion and placement.

But businesses and their agencies need to move away from the habit of just retaining data from single channels (e.g. website analytics. TV viewing figures, etc.) and transcend the basic online only attribution models that are currently out there.

They now need to understand the entire user journey that leads not just to a transaction, but to a longer-term relationship. Only then can business truly understand the influence that different devices, channels, proportional activity and other factors (such as peer recommendations) have on purchasing and subsequent behaviour.

But who is linking these sources and others together? Who is trying to pull together the collective understanding from each of the different communication and commercial channels?