How should companies measure customer acquisition cost given the difficulty of attributing conversions to specific channels?

Harry Stebbings · Feb 15, 2023

Ambiguity in conversion attribution leads teams to misidentify what caused an uptick and then take the wrong actions

He cites spending more on Facebook ads on a Friday evening that happened to be a World Cup evening, then repeating the spend the next Friday with different results

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Harry Stebbings · Apr 5, 2023 · hedged

Attribution is almost impossible because conversion takes on average about seven brand touch points, making it unknowable which touch caused the sale

With seven touch points you can't tell whether the Facebook ad at touch four or the Instagram picture at touch seven drove the conversion

Scope: cites remembered 'scientific data'

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Mike Salguero · Apr 5, 2023

Founders should calculate CPA by dividing total monthly marketing spend by number of signups rather than building per-channel attribution

A truly functioning attribution model is extremely hard to build because customers bounce between Instagram, search and direct before converting, so the effort of measuring it day in and day out isn't worth it

23:55 Blended total spend over signups beats granular per channel attribution

Mike Duboe · Feb 15, 2023

The question of the right organic/paid mix is itself flawed, because attributing a single acquisition source to a given user is usually a fallacy

Incrementality, not single-source attribution, is the right frame

36:37 The organic paid mix question is flawed since single source attribution is usually a fallacy favor incrementality

Mike Duboe · Feb 15, 2023

Last-click attribution and expensive black-box attribution models draw wrong conclusions about channel performance; incrementality testing via holdouts should be the north star

Last click hands 100% of credit to one channel — usually search because it's the highest-intent — and impact is rarely that direct; only holdout tests that incur real cost reveal true incremental CPA, which you can then apply as multipliers back into your attribution model

39:08 Last click and black box attribution models are wrong holdout based incrementality testing is the right north star