Perhaps it’s because of the upcoming holiday season and the rush of visitors e-retailers are expecting, but there has been talk about the limitations of website analytics, particularly with respect to attribution. This is quite a touchy subject to some, especially to popular banner ad networks and traditional media networks that would love to be able to demonstrate how their efforts positively impact the great results that can be achieved with organic rankings and well run PPC campaigns. This is also a touchy subject to many Internet marketers who love the idea of having perfect data to prove the success of their efforts. It’s a touchy subject because the truth is that the metrics we use to gauge the effectiveness of our Internet marketing campaigns are certainly advanced and useful, but unfortunately not perfect.

What Is Attribution?

Simply stated, attribution answers the question: what gets the credit for a conversion? Let’s say, for example, that a visitors sees your banner ad, then does a Google search and clicks on your PPC ad and converts. Which medium should get the credit for the conversion, the banner ad or the PPC ad? Should the credit be split between the two? This question hints at a fundamental problem with modern day website analytics: attribution.

Attribution & Modern Day Analytics

Analytics programs today (especially the free solutions) have decided to put a band-aid on the problem by giving full credit to the last medium to refer the visit. This means that in the example stated earlier, full credit for the conversion is given to the the PPC ad, totally ignoring the banner ad. While doing this certainly makes your reports look nice and clean, the data is far from clean. Many business owners are led astray by these attribution problems since it can appear that money spent on banner ads, email lists and branding campaigns has negative ROI, when in reality it might not.

Many content networks and traditional advertising networks have worked hard to at least be able to give you an idea of how much credit they deserve. They are now able to provide you with reports that tell you how many of your converting visitors first saw a banner ad, for example. However, be careful using these reports. When combined with reports from your other content networks and your PPC campaigns, visitors can be double counted as each network says they deserve the attribution.

What’s The Solution?

Currently, there is no real answer to these attribution problems. While the expensive analytics solutions certainly work to address attribution using long term cookies and pixels, the solutions are not perfect and attribution problems still exist,  especially when using multiple Internet marketing channels. Again, credit ends up being given to the last referring medium. To be certain, more solutions will be developed to help limit this problem, but I’m not convinced that it will happen very easily given consumer privacy concerns.

In the meantime, just realize that your reports, while made up of a lot of data, don’t provide the full picture. Be sure you don’t make the mistake of ending your branding campaigns and banner ads simply because your reports say their cost per conversion is higher, as they probably account for at least part of the success of your more profitable marketing efforts.