last click

Has the affiliate channel outgrown the CPA last click model?

It’s well known that the affiliate channel works on a cost per acquisition (CPA) model, meaning that when the desired action is completed, be it a sale, lead or quote,  the affiliate is paid.

To be able to attribute the sale to an affiliate there needs to be an agreed metric by which a sale can be attributed.

Typically this is a ‘last click wins’ model: if the last click is attributed to a particular publisher then they receive the commission.

Facebook ads undervalued by last click

Last click attribution models undervalue the contribution of Facebook ads by up to 30% in cross-channel advertising campaigns.

The last click attribution model, which credits the last ad clicked before a sale or other conversion with all the value for that conversion, is still widely used to measure the contribution of advertising.  

However, a recent Kenshoo study focused on Facebook advertising helps expose its weaknesses.

Last-click attribution is undermining your hard work

Imagine you’re a football manager, your objective is to maximise the number of goals your team scores for your budget.

However, if you were to start assessing players based solely on their goal scoring ability, you’d end up with an unbalanced team full of strikers and probably let in a lot more goals than you’d manage to score.

The same story goes for cross channel media buys; each channel has a unique position on the team and serves a unique purpose, however they’re often measured on their ability to achieve the end goal independently of the other channels.

Buying your media in this way is attractive because it uses simple metrics and makes for great reporting, but if you’re still measuring prospecting based on your conversion pixel, you could be missing a lot of opportunities from further up the path.

How Air New Zealand used tag management for attribution

Most ecommerce businesses invest in a range of digital marketing channels, so working out the exact attribution and ROI can be incredibly complex.

For example, the importance of search can often be overstated, as that tends to be the last step on the path to conversion.

To try to develop a better understanding of its marketing attribution, Air New Zealand began using a tag management system two years ago.

The ecommerce team found that the assumptions and investments that it made based on a last-click model were hugely inaccurate, particularly when it came to display.

To find out more about how tag management impacted Air New Zealand’s attribution model, I spoke to UK and continental Europe online channel manager Chris Allison…