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Abakus: The attribution modelling solution that is based on the Game Theory

In terms of attribution modelling and available solutions to solve them, one company turned to the Game Theory to assist in understanding how to assign credit to different channels in a conversation path. The company is Abakus.

Firstly we need to define some terms here. If you do not already know, but attribution modelling solution measures the impact of marketing and media efforts, and recommends methods to improve that influence, but also to ensure that the marketing budget is allocated correctly. Attribution also assigns credit based on actual influence, which a more current approach as compared to the archaic last-click attribution model or likewise flawed first-click attribution model.

More so, in this example of industry solutions for attribution modelling, we are dealing with a tool that’s methodology is based on the Game Theory. The Game Theory is “the study of mathematical models of conflict and cooperation between intelligent rational decision-makers.” If Game Theory is used in a cooperative situation, which is referred to as a Shapley value (named after the 2012 Noble Price winner for Economic, Lloyd Shapley) it is used to fairly assign credit to a particular part, based on the average value to be assigned to each, resulting in a fair solution of credit awarding. What Abakus did, was to patent their idea of applying Game Theory and the concept of Shapley value to attribution.

But who is Abakus? Abakus, is a Multitouch Attribution (MTA) category company that delivers a cloud based real time software for cross-channel media attribution. Short profile of the company:

• Founded in 2013
• Headquarters in California
• Abakus has 26 employers
• Daily active users 5,182,796
• Alex Saldanda is the CEO
• 100% revenue from software
• Clients include the retail, automotive and travel industries, e.g. Starwood Hotels and Resorts Worldwide, Mindshare

Unlike predefined attribution solutions, Abakus’ software takes into account each touchpoint’s influence in as part of the customer’s total journey. Their patented technology solution analyses marketing activity, across all channels, in real-time. In doing so, this tool indicates what is working, why, and how to optimise performance. In reality, a marketer should reach a customer at the right time, on the right device, with the right message. Abakus’ software aims to do that, by offering a more defined, granular targeting options and worthy marketing data to marketers. The application of game theory attribution that uses algorithms and the Shapley value to identify the impact of each touchpoint and then fairly distribute credit to each touchpoint in a conversion path is then used in Abakus’ software to optimization media spent.

As such Abakus’ software ensures that the measure incremental impact by using multivariate analysis to compute the incremental contribution of all marketing elements simultaneously. Furthermore, the solution eliminates data inconsistencies by integrating with leading technology providers and allows you to incorporate data from all existing sources into once place. In addition, it makes timely changes, so you no longer have to wait for analytics. Abakus’ easy-to-use software platform allows you to make timely marketing decisions with daily updates. Plus, it optimize with confidence. The interactive, predictive optimization dashboard makes optimizing your campaign easy. Know the impact of changes before you even make them. It does away with the need for assumptive model-based systems and gives us a higher degree of confidence that all of an advertiser’s marketing activity, is being taken into account. Furthermore it address the right audience, since with advanced segmentation and split funnel analysis let you see which marketing is reaching your customer segments.

Abakus’ edge. Abakus is the first attribution and marketing optimization company to apply collaborative Game Theory to marketing. The patented approach allows advertisers to see results that are more accurate, faster, and result in higher ROI. Plus, based on it methodology, that gears to the idea that it sticks to a single patented algorithmic approach of the game theory. The company has a patent for its game theory method.

Therefore, this solution should be considered if you trust in the analytical value of Game Theory based attribution methods or if you need an end-to-end marketing cloud-based solution, sustained by SAP, and have relatively unpredictable data inputs.

The challenges. As with all attribution models you will find some flaws. With the game theory attribution, it calculates value based on former comments. That is the Shapley value states that the value of an AdWords ad will be the same when followed by a direct visit and a paid search advertisement, but this order won’t influence every consumer in the same way every time. Other challenges this approach has is relating to collecting and validating data, measuring what activity is causing customer sales and explaining why, as well as understanding clearly what changes should be made and what the expected outcome is likely to be.

The possibilities. Even with the flaws associated with the game theory approach, the Abakus’ software could offer some possibilities.

Google has made changes to its AdWords. These changes would lead to changes to Google’s search engine results, and it would mean that PPC marketers will need to keep up. Attribution, in fact a company such as Abakus could assist. That is with real-time attribution by Abakus, marketers can effortlessly see which search terms are driving value, and which are costing too much to be efficient players. Abakus also allows marketers to see where value can be gained from other channels, like display and video, where opportunities to drive more efficient value may be present with the seismic change Google has wrought. Abakus provides tools that show you your cross channel marketing effectiveness, the top paths to user conversion, and your most efficient players using a patented algorithm that relies on proven methodology to inform the marketer on his best choices in marketing. Further, it identifies opportunities to shift budgets to take advantages of marketing inefficiencies that will drive more revenue and conversions to the client’s website. The prediction is that the change in Google will drive more users to display, video, and like channels, which tend to be a little harder to measure than traditional PPC marketing. Abakus has the know how to do so.

About Adriaan Brits

I'm Adriaan Brits, a digital and strategic marketing consultant, Linkedin learning instructor and outreach media owner. I authored the popular Linkedin course "Digital Marketing Research" with more than 120 000 enrolments to date. I help businesses and agencies plan their PR and media buying: See my boutique marketing agency at www.adriaanbrits.com and connect with me on Linkedin

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