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Tactic Attribution: Applying Practical Alternatives

April 01, 2015

The term “snake oil” refers to a cure-all medicine, peddled as a remedy for ailments ranging from muscle pain to kidney trouble. In late 19th century America, traveling salesmen would arrive in a town or village, sell their magic elixirs, then move on before buyers realized that the miracle cure was a sham. Eventually, all-in-one cures fell out of favor as people wised up and government regulations tightened.

Many b-to-b marketers use tactic attribution – assigning a revenue value to marketing tactics by attributing successful deals to them – as a cure-all for marketing problems and challenges. Although it’s touted as a universal method for understanding marketing effectiveness, tactic attribution has intrinsic shortcomings that can distort reality and impair marketing planning (see the brief “Voodoo Analytics: Tactic Attribution”). In this issue of SiriusPerspectives, we describe three areas where tactic attribution models are commonly applied, and provide practical alternatives for each area.

Tactic Attribution

One: Resource Allocation

Allocating marketing resources across programs and people must be rationalized and defensible, which is why the idea of attributing a revenue value to tactics is appealing. Tactics with track records that indicate higher revenue values command bigger shares of the marketing budget. Instead of relying on tactic attribution, a planning structure supported by data points and business insight is a more reliable alternative for allocating resources and convincing organizational leadership of any plan’s viability. Consider using these approaches to rationalize resource allocation:

  • Apply campaign discipline. There’s no substitute for purposeful planning. Goal setting, as part of the campaign implementation process, aligns campaign objectives with business goals, providing a vision for what marketing needs to accomplish (see the Core Strategy Report “The SiriusDecisions Campaign Implementation Process”). Campaign goal setting is a prerequisite to making informed decisions about what tactic investments are required, because, regardless of last year’s performance (which tactic attribution focuses on), resources need to be allocated to achieve the objectives defined for the current year.
  • Incorporate allocation benchmarks. Use budget allocation data from similar organizations as a reference point for distributing efforts and resources across programs and tactic areas. Marketing leaders should not aspire to duplicate benchmark levels; instead, seek to understand the reasons for deviations in order to identify where different approaches are required. Variations may be justified by an organization’s capability to successfully perform a tactic type or differences in market factors or business objectives.

  • Set performance targets. One reason why some b-to-b organizations struggle to understand past tactic effectiveness is their failure to set performance targets for those tactics before they were implemented. Without targets, it’s impossible to gauge whether a tactic has performed well or poorly. As part of the campaign planning process, each tactic should be associated with a program-level objective as well as a short-term tactic-level performance target (e.g. inquiries, press mentions, utilization). Organizations that set tactic-level targets can evaluate success vs. pre-set reference points, which enables marketers to bias future tactic selection toward those that performed successfully.
  • Be specific. Begin to categorize tactics by the stages of the buyer’s journey they’re intended to support and the buyer personas they’re aimed at. This will inform marketers how to set expectations for the performance of each tactic. For example, tactics aimed at CXO-level buyers late in the buying process will not have the same volume of response as those aimed at broader audiences earlier in the buyer’s journey. This approach also facilitates a balance of tactics targeting each defined buyer persona across the required stages of the buyer’s journey.

Two: Performance Optimization

Following resource allocation, marketing organizations need the ability to make continuous adjustments, taking into account what is and isn’t working. Tactic attribution directly correlates outcomes with actions, but the results are often misleading, because this approach misses the impact of multiple variables. Use the following methods to more accurately assess and adjust performance:

  • Identify unused tactics. Although it can be difficult to determine which tactics are most effective, it’s easy to identify which tactics were not used at all by their intended audience and those that don’t show up in any opportunity cycles. Unused tactics have no opportunity to create value. Optimize performance by adjusting or dropping these activities, and utilize the resources saved to test other tactics that have a chance of being successful. Marketing teams can only measure the performance of the tactics they execute, and too often other tactic options get overlooked with because no internal track record for these options exists.
  • Expand A/B testing. Marketing must decide which tactics perform better than others at meeting specific objectives. For a narrowly defined set of activities with common objectives, incorporate short- and medium-term A/B tests in which similar tactics are delivered to a similar audience and the results are compared. Short-term comparisons should primarily consider the level of response. Over extended time periods, tactics can be associated with the likelihood of achieving stage objectives.

  • Perform touch analysis. Touch analysis is a technique that analyzes which tactics perform best relative to specific deals (see the brief “Tactic ROI: Marketing Touch Analysis”). Instead of assigning a revenue value to each tactic, this type of analysis looks at the complete interaction history of successful deals to identify patterns of interaction commonly associated with better outcomes. Because of the labor-intensive nature of the exercise, touch analysis should be performed for a limited sample of deals, then tested against larger sets of opportunities. Patterns that withstand scrutiny should be used to refine tactic selection.

Three: Marketing Contribution

Marketing organizations are compelled to show how their efforts contribute to business impact. Because tactic attribution models don’t assess results in terms of business goals, they are inadequate tools for revealing the full picture of how marketing creates business value. Take the following steps to clarify marketing’s contribution:

  • Link objectives with KPIs. Organizations that struggle to demonstrate marketing’s contribution typically lack a clear connection between businesses objectives and how marketing intends to help drive the achievement of those objectives. Use the SiriusDecisions roadmap for marketing measurement to initiate a process-driven measurement approach (see the brief “A Roadmap for Marketing Measurement”). Gather stakeholder feedback on marketing’s objectives, and create key performance indicators (KPIs) based on those objectives in order to demonstrate specific marketing achievements.
  • Establish program-level targets. It’s not enough to know that the organization has achieved top-level objectives (e.g. gains in market share and revenue) if these achievements can’t be linked to what marketing has done. Create program-level targets (see the brief “The SiriusDecisions Aligned Measurement Framework”) to link tactic performance across program families (e.g. demand creation, reputation, sales enablement) with business outcomes. This approach accounts for outcomes outside of demand creation as well as those directly related to deals.
  • Socialize the approach. In most b-to-b organizations, marketing’s contributions are neither well understood nor fully appreciated. Marketing leaders must ensure that the approach for measuring marketing’s contribution is communicated to the larger organization. A communication plan should be a core element in all marketing reporting (see the brief “Building a Communication Plan for Marketing Reporting”). Marketing leaders must clearly communicate to organizational stakeholders what marketing’s objectives are, how they will be achieved and how they relate to business performance.

The Sirius Decision

Tactic attribution may seem like an easy solution, but it consistently sends b-to-b marketers down the wrong path. More accurate approaches can be used to buttress the organization’s planning and measurement processes, clarifying what the business needs to accomplish and how it’s performing against those requirements. Instead of creating an indefensible view of revenue returns against individual tactics, a comprehensive system of measurement like the SiriusDecisions Aligned Measurement Framework links activity and impact across all facets of the organization.