Conversion attribution is the process of giving credit for a conversion observed on a website (more often a sale) to the online marketing channel(s) which is or are the source of the conversion.
In a white paper DoubleClick offers a good definition of conversion attribution: "Conversion attribution is the practice advertisers use to give appropriate credit to every impression, interaction or click that helped drive a conversion in a campaign."
Conversion attribution is used for marketing analysis, channel ROi measurement and for paying out marketing partners and vendors in performance marketing context.
Traditional conversion attribution methods have mainly two flaws or limits which are multiple conversion attributions and last cookie or last channel rules.
Multiple conversion attributions refers to the fact of crediting and possibly paying several partners for a single conversion. It is due to the conversion being registered by each partner’s third party conversion tag.
Let us look at an example:
a consumer visits a merchant site referring from an affiliate website
he looks at a product and abandons his visit for the day
he comes back a day later after having entered the merchant name in the Google search box and clicked through the merchant’s Adwords announce.
In this example, the affiliate platform third party tag counts a conversion and the Adwords conversion tag does the same. From the two partners’ dashboards, the merchant marketer can observe two conversions and only one in his web analytics dashborad.
Last cookie, last click or last channel rules are other limitations. Last cookie rule is used in affiliate programs and last source or last click at web analytics level. Only the last affiliate or traffic source is then credited for a conversion. Except for the Multi-Channel Funnel reports, Google Analytics uses a last click attribution model.
Search channels for brand keywords (SEA & SEO) and bookmarks are often overestimated with last ad clicked model used by default and "steal attributions" from display channels.
To take into account classic limits of conversion attribution, web analytics solutions and other dedicated services (some tag management systems for instance) identify paths to conversion and offer conversion attribution models.
An illustration that many channels contribute to conversion:
Image credit Fuor
The complexity of attribution illustrated by Microsoft: