The world of digital marketing is evolving quicker than ever before. Since the iOS 14.5 update in 2021, direct-to-consumer brands were forced to find new solutions to attribution, and so launched numerous companies that have promised to answer how advertisers can measure campaign effectiveness. As noted by Catherine Perloff for AdWeek, third-party attribution tools are seeing an upward trend from ecommerce brands seeking more effective ways to allocate their advertising budgets.
During Meta’s 2024 Performance Marketing Summit, Meta introduced another layer to this complex ecosystem with the announcement of an incrementality-based attribution tool.
Here’s a closer look at how these tools differ, how they might work together, and why first-party data remains crucial.
Third-Party Attribution Tools
Third-party attribution tools typically offer an unbiased form of measurement, helping brands evaluate their advertising performance across multiple platforms with confidence. These tools look to provide cross-channel insights enabling brands to track attributed sales from various touchpoints, including search, social media, and email/SMS marketing. Ecommerce brands can also tailor their analytics to focus on specific metrics or attribution windows.
Meta's Incrementality-Based Attribution Tool
Now in Beta, Meta’s new tool will focus on determining how many of the conversions, or how much of the incremental ROAS, can be directly attributed to the advertising efforts on Meta’s platforms, beyond what would have occurred organically. Their lift methodology will compare the metrics between the two groups to calculate the incrementality.
Attribution Calibration
While third-party tools and Meta’s incrementality tool have distinct approaches, Meta will offer ways that they can complement each other allowing ecommerce brands to take their preferred approach to measurement to create a holistic view and to validate Meta’s findings. Brands can use these observations to run experiments for continued measurement calibration and optimize budget allocation more effectively.
The Confidence Gap
Despite the advancements in attribution tools, many marketers still lack confidence in relying solely on any single solution. There is no one-size-fits-all solution and attribution is often seen as a reporting tool versus guidance of the digital strategy. Even with newly found confidence from these tools, brands have shared that it doesn’t solve for a performance marketing channel’s number one recommendation; DATA INPUT IS KEY – GIVE STRONG DATA SIGNALS AS MUCH AS POSSIBLE. This sentiment highlights the importance of integrating multiple data sources and methods to get the most accurate insights.
The Power of First-Party Data
First-party data remains a cornerstone for profitable growth. It is directly collected from customers, ensuring accuracy, relevancy, and regulation compliance – and, paired with Decile’s robust enrichment capabilities, reflects genuine interactions and preferences, providing valuable learnings and a more complete picture of customer behavior.
First-party data offers critical insights into who brands should target and on which platform by reversing the funnel. With properly tagged and tracked marketing campaigns, the data can be directly associated from campaign to customer record. And, with the help of a modern CDP such as Decile, the data is centralized, alleviating data integrity concerns so that marketers aren’t left guessing which marketing channels to remove or where to increase / decrease budget.
As a brand, you can use Decile to quickly and easily create detailed, AI-generated personas based on your current customers. Breaking out the highest value customer personas by their purchase patterns, you can leverage their first-party data directly, feeding superior and up-to-date data to optimize your marketing channels and create personalized campaigns to improve customer engagement, loyalty, and lifetime value.
Third-party attribution tools and Meta’s incrementality-based tool will offer reporting benefits as these tools progress, and their combined use can provide a holistic view of advertising performance. Ultimately, attribution is a small piece of the larger puzzle of measuring success of your marketing efforts. If your business is looking to grow profitably, analyzing and utilizing first-party data with a tool like Decile is indispensable for accurately monitoring and measuring lifetime customer value, customer acquisition costs, and ensuring that your brand can deliver personalized and impactful marketing experiences to grow your pool of best customers.