In digital advertising, measuring the effectiveness of ads and understanding how customers interact with them is essential for optimizing campaigns. One common attribution model used to track the customer journey is the Last-Click Model. This model has been widely used in AdTech due to its simplicity and effectiveness in certain contexts. In this article, we’ll explain what the Last-Click Model is, how it works, its advantages and disadvantages, and how it fits into the larger picture of digital advertising.
What is the Last-Click Attribution Model?
The Last-Click Model is an attribution model that assigns all credit for a conversion (e.g., a sale, sign-up, or other desired actions) to the last touchpoint a customer interacts with before completing the desired action. In other words, the final ad or interaction that led the customer to convert is the one that gets all the credit, regardless of the other touchpoints along the journey.
For example, if a customer sees a banner ad on a website, clicks on a Google ad later, and finally completes a purchase via an email campaign, the Last-Click Model would give all credit to the email campaign, since it was the last interaction before the purchase.
How Does the Last-Click Model Work?
The Last-Click Model works by tracking each customer’s interactions with various touchpoints in an advertising campaign. These touchpoints could be different forms of digital ads (like display ads, social media ads, or search ads), emails, or even organic search results.
Here’s how the model works step by step:
- Tracking Interactions: Every time a potential customer interacts with an ad, whether by viewing it, clicking on it, or engaging in some way, that interaction is logged.
- Final Touchpoint: The system tracks the last touchpoint or interaction a customer has just before they convert (make a purchase or complete the desired action).
- Attribution of Conversion: All credit for the conversion is given to this final touchpoint, regardless of the other touchpoints in the customer’s journey.
The model is simple to understand and easy to implement. This makes it an attractive option for advertisers who are looking for straightforward tracking of conversion events.
Advantages of the Last-Click Model
Despite its simplicity, the Last-Click Model offers several benefits, especially in specific campaign types. Let’s explore some of the advantages of using this attribution model:
1. Simplicity and Clarity
The main advantage of the Last-Click Model is its simplicity. It’s easy to understand and implement. There is no need to track every touchpoint or weigh the value of each interaction. Advertisers can quickly identify the last point of contact before a conversion and assign full credit to that ad.
2. Focus on Final Conversion
For many advertisers, the goal is to drive direct conversions, whether that’s making a sale or getting a lead. The Last-Click Model focuses on the touchpoint that directly resulted in the conversion, making it useful for campaigns aiming for immediate results.
3. Works Well for Shorter Sales Cycles
If your product or service has a short sales cycle, where customers make quick decisions, the Last-Click Model can work effectively. In such cases, the final interaction before a conversion is often the most significant factor in the customer’s decision-making process.
4. Easy to Implement
The Last-Click Model is easy to set up and doesn’t require sophisticated tracking tools or analytics systems. This makes it appealing for smaller businesses or advertisers who may not have access to advanced attribution technologies.
Disadvantages of the Last-Click Model
While the Last-Click Model is useful in certain scenarios, it comes with limitations. Let’s take a look at some of the drawbacks:
1. Ignores the Full Customer Journey
One of the biggest criticisms of the Last-Click Model is that it ignores the full customer journey. In reality, many customers interact with several touchpoints before making a purchase decision. This model overlooks all the other ads or interactions that may have influenced the customer, making it harder to understand how each touchpoint contributed to the final decision.
2. Unbalanced Credit Attribution
By assigning all the credit to the last touchpoint, the model can give an unbalanced view of the effectiveness of different channels. For example, if a customer first interacts with an ad via a Facebook post, but the final click that led to the purchase comes from a Google search ad, the Facebook ad gets no credit for the role it played in the customer’s decision-making process. This can lead to underestimating the value of earlier touchpoints.
3. Less Effective for Complex Sales Cycles
For products or services with a longer sales cycle, the Last-Click Model may not be as accurate. In such cases, customers may take time to evaluate multiple options, and several touchpoints may be involved in building trust or awareness before they make a purchase. This model fails to capture these nuances and may mislead advertisers about which interactions were most effective in driving conversions.
4. Overemphasis on Final Interactions
The Last-Click Model puts too much emphasis on the final interaction, potentially ignoring the importance of brand awareness and earlier touchpoints. This could lead to advertisers focusing too much on final-stage conversions while neglecting efforts that drive initial engagement and interest.
When to Use the Last-Click Model
Despite its limitations, the Last-Click Model can be useful in certain situations:
- Short Sales Cycles: If your product is something that customers buy quickly and impulsively (like small items or impulse buys), the Last-Click Model may provide a good measure of which ads drive direct conversions.
- Performance-Based Campaigns: If the goal of your campaign is to measure the immediate success of a specific ad (e.g., paid search ads), this model can give a clear view of which ads led directly to conversions.
- Simplicity Over Accuracy: When you need a simple, easy-to-understand attribution model for a limited budget or simpler campaigns, the Last-Click Model is an efficient solution.
Conclusion
The Last-Click Model in AdTech is a straightforward and widely-used method for attributing conversions to the final interaction a customer has before taking action. It offers simplicity, ease of use, and clarity, making it a great option for certain campaigns. This is especially true for campaigns with shorter sales cycles. However, the model has significant limitations, particularly in overlooking the full customer journey. It tends to give disproportionate credit to the last touchpoint, ignoring earlier interactions. As a result, marketers may miss valuable insights into how prior engagements influenced customer decisions.
Advertisers need to carefully consider whether the Last-Click Model suits their goals and sales process. For more complex or multi-touch journeys, a more nuanced attribution model may be required to understand the full impact of every touchpoint in the customer’s path to conversion.
Frequently Asked Questions (FAQs)
1. What is the Last-Click Attribution Model in AdTech?
The Last-Click Model assigns all credit for a conversion to the last touchpoint a customer interacts with before completing an action.
2. What are the benefits of it?
The model is simple to implement, focuses on direct conversions, and is effective for short sales cycles or performance-based campaigns.
3. What are the limitations of this model?
It overlooks the full customer journey and gives unbalanced credit to the last interaction. It also may not work well for complex sales cycles.
4. When should I use this model?
Use it for short sales cycles, performance-based campaigns, or when you need a simple, clear way to track conversions.
