Hospitality Sales and Marketing Association International
Hospitality Sales and Marketing Association International
 
Hospitality Sales and Marketing Association International
Measuring the value of your digital marketing budget and performance by marketing channel

January 26, 2017

By Euan Mitchell, HSMAI UAE Advisory Board Member

Is last-click still the model and measurement to use for measuring success of digital spend?

There are various analytics platforms and tools which digital marketers in the hospitality sector still use. Adobe (Omniture - Sitecatalyst), Yahoo Analytics and Google Analytics  are some of the most dominant, but do these really give insight and show the value of  contributing channels? Hospitality is a complicated purchase decision that involves an average of 18 touchpoints in a customer’s pathway to booking (Google: e-travel presentation 2016)

Source: Ghostery sample of 50 highest traffic hotels websites in MENA region. NB some sites have multiple platforms so total > 100%.

Are analytics platforms that report on a last click giving you the data you need, and how do the aggregated campaign performance metrics supplied by external agencies correlate with your reservation data. Is more than one agency claiming responsibility for an individual booking? What value are the agencies providing and who is actually contributing and driving the conversion?

In marketing, Attribution is the process of identifying a set of user actions (“events” or "touchpoints") that contribute in some manner to a desired outcome, and then assigning a value to each of these events. Marketing attribution provides a level of understanding of what events, and perhaps in what particular order, influences individuals to engage in a desired behaviour or ‘conversion’.

An attribution model is the rule, or set of rules, that determines how credit for sales and conversions is assigned to touchpoints in conversion paths.

Marketing budgets are under more scrutiny from finance departments. And for digital marketing, where everything is expected to be tracked and measured, it is more important to be able to align media spend and ROI against the defined business goals.

By using Attribution, the business can properly evaluate and review the “influence of digital channels”. Without it, the digital marketing spend and ROI true value cannot be accurately measured.

If you haven’t already done so, read the very comprehensive HSMAI Attribution presentation by Debbie Johnsen. It will explain the foundations of attribution in more detail than can be covered here.

Allegorical Example:

In a game of football, it is important to have a team that can play well together. It is made up of a goalkeeper, defence, midfield and attackers including a striker who scores goals (like the last channel that influences the consumer to make a purchase). Rather than having a team full of strikers, the most successful and best teams are those that have players that compliment each other for the best outcomes. The attribution model tells you how much each player has contributed to the goal.  

A Goal is not just the product of the striker, and a team full of strikers would not make a good team.

The evolution of online Measurement

During the early days in the evolution of online measurement, it was a single click that received all the glory for a purchase. Regardless of whether it was the first click, last click, or some other spurious alternative, a single channel gained 100% reward. This is the equivalent of picking a football team based on goal scorers.

Then there came multi-touchpoint rules based approach, but this is prone to be subjective and does not necessarily evaluate contribution based on influence. Examples for these include names such as equalised value, linear decay, U-Shaped - however, the choice of the ruleset is arbitrary, and there is no reason why one version is better than another. Google Analytics lists nearly 400 different rules-based attribution models in its attribution gallery, which would take years if not decades to evaluate. In fact, evaluation may end up being impossible due to one fundamental flaw - a lack of comparison to non-converting data, which leads us on to the next type of model.

As it currently stands, the most sophisticated type of attribution available on the market today is Algorithmic, or Data Driven attribution. These types of models do away with subjective rulesets and utilise statistical or machine learning models that compare all the available converting and non-converting data to produce attribution values that are more accurately linked to contribution to bookings. A flaw with the previous models that do not use non-converting data is that they are prone to a form of  ‘survivor-bias’. A simple analogy for this to consider a campaign that managed 100% reach in a target market, which would mean that 100% of bookings in that market will have contained a touchpoint from that campaign. Analysis of the converting data would suggest that the campaign had been extremely successful, but by including the non-converting data, algorithmic models would show the extent to which the activity is superfluous and give a greater understanding.

All attribution models work on the pathway to conversion, but over the years, the pathway has become more fragmented across multiple devices and communication touch points. So to have true attribution requires the ability to know the same users across all of their

smartphones, tablets and laptops. This will be covered in another paper, but needless to say, cross-device mapping and attribution need to work hand in hand.

If the hospitality industry or indeed any other ecommerce enterprise is not utilising the full spectrum of improved technologies to help provide data driven marketing decisions based on attribution, then they are missing out on the basic set of commercial principles that support marketing investment in the appropriate channels.

Author:

Euan Mitchell

Digital Marketing hospitality professional with two decades of experience, HSMAI UAE Advisory Board Member

He has adopted and adapted various attribution solutions over the last 10 years, the latest platform being www.quantdeck.com, for whom he now acts as non-executive advisor.





HSMAI Digital Marketing Strategy Conference 2018