at·tri·bu·tion /ˌatrəˈbyo͞oSH(ə)n/ the action of regarding something as being caused by a person or thing.
In this case, attribution is the act of tracing a sale back to the source of the contact. In today’s world, this can be more complicated than it seems, with customers arriving at the dealer from multiple sources.
Why is it important? A typical dealer could spend all day talking to reps from countless vendors. How many times have we heard that if a tool causes one more sale each month it has paid for itself? Dealers could spend all of their profit in the quest of getting customers, but never know which ad sources and lead generation tools actually sell cars. With online marketing budgets at historic levels, how do we know which spend make sense and which spend is just wasteful?
Attribution tools have popped up recently to help dealers sort through the mess and spend their advertising dollars on the lead streams that actually sell cars. At least that is the goal, but what does a tool need to be able to do that?
Requirements of an attribution tool:
- DMS connection: Getting sale data from the DMS is the only true way to get accurate info. CRM tools are full of partial and duplicate info that is entered by numerous people. They are not a reliable source for the data. In addition, the DMS can supply a whole host of additional transactional data that will allow the attribution tool to provide valuable insight into other areas like how site traffic/leads/conversion tools/inventory levels/personnel/time periods/etc. affect sales and gross profit. The DMS connection will also add true gross ROI in the form of Front/Back/Holdback/Pack.
- Ability to view incoming leads from all sources: To give an accurate picture of what is actually contributing to sales, you need to be able to view data from all sources, including third party tools. The attribution tool will need this capability, otherwise, there are blackout areas which make it much harder to see the value of the third party tools (or lack of value).
- Ability to view data by attribution model: First touch = the first source to bring the customer to the website/dealership. Last Touch = the source that finally put the customer over the edge and resulted in a lead from submission. Linear Touch = this gives credit to all places that the customer interacted with. In today’s shopping, this is arguably the most relevant model, since customers are not interacting with one source and coming in.
- Ability to separate data by channel (Organic traffic/Paid Search/Social Media/Direct/etc.). This is a valuable way to see how the various channels contribute.
The bottom line is that we now have the ability to look at the marketing budget (which includes all tools) under a microscope to determine which ad spend is most effective. This allows the waste to be eliminated and the overall budget to be kept under control. You would trade $1 for $5, but you would want to know if you are trading $5 for $1, right?