Measure ad performance through incrementality

Among the great challenges of digital marketing is the distribution of the budget. This is because many of the conversions are generated without the help of advertising.

Hence the importance of measuring incrementality, which helps us identify the income generated from marketing efforts, in addition to the attribution that allows assigning the merit of income to each channel or medium.

Although it seems that incrementality and attribution are the same, they are not. Here is the explanation of each one.

As I already mentioned, there are a lot of conversions that are generated without the help of marketing, hence the importance of measuring incrementality.

The incrementality It is the identification of the number of conversions that would have been generated, even if no budget was invested.

There are 3 ways to measure incrementality:

By silo of the advertising channel
It allows the identification of the conversions that are generated without any type of paid advertising and is useful to optimize advertising on an individual channel. Conversion growth studies such as Facebook’s Conversion Lift can be performed, which measures the increase in conversions generated by ads.
By platform
Helps identify performance decline by platform, allowing for budget optimizations. It is useful in Facebook and Instagram branding campaigns, where an overlap of audiences could be generated, which in turn would cause a decrease in incrementality.
By channel
It allows performing analysis of the performance of all channels and platforms, and from there to identify the incrementality generated by these media and how much we should spend on them depending on the performance they generated.

While paid advertising drives conversions, we can’t give it full credit, as other media such as organic search, email, and even OOH advertising and TV also played a role in generating them.

And to identify how each medium, paid or not, contributed to each of these conversions, we can use attribution.

The attribution is the science of distributing credit for conversions generated between advertising channels, both online and offline.

The allocation of the credit for conversion by X or Y channel, on and offline, is achieved through an attribution analysis, which identifies all interactions in the entire user journey, such as impressions and clicks, as well as their influence in conversion.

Attribution analysis can be performed using web analysis tools such as Google Analytics or Adobe Analytics, which allow integrating and analyzing data from paid, own and organic media, through an attribution model and using Machine Learning.

Knowing how much our conversions increased through incrementality, and how our advertising efforts contributed through attribution, will help us more optimally distribute the marketing budget for our brand.