Why Last-Click Attribution Isn't Effective

For the past decade, there’s been an impossible-to-kill myth in digital advertising: clicks are king. Last-click attribution is seen by many marketers as an easy and accurate solution for measuring digital performance. Naturally, marketers using last-click attribution are more attracted to vendors that price per click to drive last-click performance. There’s just one problem with this approach: it’s not very effective.

Let’s Walk Through a Scenario

Imagine that your retail business is using Google Analytics to report on campaign performance across social, email, display, and search campaigns, all with the same last-click ROI goal. Brand awareness tactics such as video, display, TV, and events are also measured through Google Analytics.

While evaluating performance, you notice that search and CPC priced retargeting are exceeding your ROI goal in Google Analytics reporting. So, you decide to decrease budgets across all brand campaigns and double your search and retargeting budgets, which are —  surprise, surprise — your top performing channels in Google Analytics.

Fast forward a month, and you notice a downward trend — your click ROI for search has plummeted, CPC priced retargeting is struggling to scale, and your cost-per-click (CPC) has increased by a whopping 100%. Website traffic is down 30% across the board, and customer acquisition rates are at the lowest it's been all year.

You haven’t hit your 20% growth target and are now in a sticky position, having to explain to your manager why the changes you made haven’t resulted in the predicted revenue growth.

Why is this happening? Because search and display are direct tactics that focus on clicks. Let’s break down why click pricing and last-click measurement are detrimental to business growth.

Optimizing for Clicks Doesn't Equate to Optimizing for Sales

Do you remember the last time you clicked on a display ad?

It's okay; most people don't.

In fact, only 4% of internet users are clicking on ads. This narrow scope in targeting clicky users means you optimize for a tiny subset of your audience. By doing so, you leave a large portion of your potential customers on the table, not focusing on them just because they aren't prone to click. Studies show that users who are clicking on ads aren’t necessarily more likely to buy your products. There’s almost no correlation between click-through rates and purchase behavior. As per Nielsen’s Study on online brand lift:

...click-through rate for a given ad campaign showed no connection to sales lift and no measure of whether the message resonated with consumers.

Click vendors only make money when users click on your ads. While this might sound like risk-free pricing, this means click vendors are geared toward targeting bottom-of-the-funnel users who are likely to convert, anyway.

Optimizing for Clicks Is More Expensive for Your Business

Because the percentage of users who click on ads is so small, and vendors that price on CPC are all chasing the same people, “clicky” consumers are up to 5x more expensive, even though there’s zero evidence that these users are more likely to drive sales.

Click-Only Reporting Doesn’t Tell the Real Customer Story

With an ever-changing search landscape and an increasing presence of smart devices in our day-to-day lives, users no longer merely search and purchase at their desktop computers. A typical retail customer journey involves an average of 56 retail consumer touchpoints from intro to sale across multiple devices and platforms.

Yes, last-clicks are valuable across this customer journey and deserve recognition, but to give them all the credit is a narrow view of attribution that can hamper your ability to grow your business further. You need to be able to identify more than just the channels that perform well at a single touchpoint — you also have to understand how channels work together to influence customers to visit your site and complete their purchase. 

What Does This Mean For You?

Chasing clicks, whether it be with a heavy reliance on click vendors or through reporting in Google Analytics, isn't only inaccurate; it's hurting your business growth.

Think of it this way: As you layer strategies outside of search, your business has outgrown Google Analytics as a reporting platform, and you need to evolve your measurement solution.

There are several great measurement solutions in-market that are worth researching to find a good fit for your business. It's important to search for a measurement solution that provides actionable insights into your customer journey. 

From why single-touch attribution is out of style to what to expect during attribution implementation, here are the blog posts you can’t miss.

Attribution and Measurement: Tracking and Optimizing Digital Performance [CHECKLIST]
Last-Click Attribution: Why It’s Out of Style
Attribution: From Awareness to Beyond
The Different Types of Multi-Touch Attribution Modeling
The Different Types of Multi-Touch Attribution Modeling
Attribution Implementation: What to Expect
Attribution Implementation: The First 90 Days

Last updated on September 5th, 2023.