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---
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title: 'Attribution'
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icon: magnifying-glass-chart
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description: 'Learn why onchain attribution matters for sustainable growth and how Formo attributes conversions from first click to wallet transaction.'
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iconType: solid
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title: "How attribution works"
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icon: "magnifying-glass-chart"
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description: "Learn why onchain attribution matters for sustainable growth and how Formo attributes conversions from first click to wallet transaction."
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iconType: "solid"
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---
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### Overview
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User acquisition is one of the biggest problems in crypto.
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For an app to succeed, it must have **sustainable unit economics** when it comes to user acquisition.
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The lifetime revenue of a user (LTV) should be greater than the cost to acquire them (CAC) at a healthy multiple.
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User acquisition is one of the biggest problems in crypto. For an app to succeed, it must have **sustainable unit economics** when it comes to user acquisition. The lifetime revenue of a user (LTV) should be greater than the cost to acquire them (CAC) at a healthy multiple.
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<Frame>
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<imgsrc="/images/intro0.png"alt="Formo" />
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</Frame>
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Without accurate attribution, you are lost in the dark forest.
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Attribution helps answer:
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- Where did users come from?
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Without accurate attribution, you are lost in the dark forest. Attribution helps answer:
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- Where did users come from?
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- What meaningful activity did users perform on my app?
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- How well are users monetizing? How much revenue did I make? (ARPU, LTV)
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- How long are users sticking around? (Retention, Churn)
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- Is my ROI for an acquisition channel positive? (LTV > CAC)
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- Is my ROI for an acquisition channel positive? (LTV \> CAC)
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### Example
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Attribution in web3 is *complex*.
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Attribution in web3 is _complex_.
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Consider the following example user journey for a DEX called FooSwap with many touchpoints:
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- A user sees a tweet thread about an app on X (*"referrer"*) clicks on a referral link
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- The user visits the app's website (fooswap.com)
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- A user sees a tweet thread about an app on X (_"referrer"_) clicks on a referral link
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- The user visits the app's website (fooswap.com)
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- The user visits the app (app.fooswap.com)
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- The user connects their wallet on the app
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- The user signs a token approval message
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- The user starts a swap transaction but the wallet has insufficient gas
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- The user abandons their transaction (*"dropoff"*)
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- The user revisits the app from another channel on Farcaster (*"referrer"*)
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- The user completes a swap transaction (*"conversion"*) emitting an onchain event
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- The user abandons their transaction (_"dropoff"_)
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- The user revisits the app from another channel on Farcaster (_"referrer"_)
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- The user completes a swap transaction (_"conversion"_) emitting an onchain event
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As you've seen in the above example, not everything you care about is onchain. In this example, two touchpoints contribute to the successful conversion: X and Farcaster. Using an [attribution model](/data/attribution#attribution-models), we can determine which touchpoint to credit for the conversion:
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### How attribution works in Formo
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To understand the full user journey, **we must navigate two different worlds: offchain and onchain.**
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It's imperative to trace the event sequence from initial engagement offchain to conversion onchain.
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To understand the full user journey, **we must navigate two different worlds: offchain and onchain.** It's imperative to trace the event sequence from initial engagement offchain to conversion onchain.
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Here's a high-level overview of how it works:
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```
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Formo solves two core functions: attribution and identity.
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-**Attribution** refers to [event-based analytics](/data/events/overview) about where, how, and when users interact with links, sites, and apps (touchpoint trackers, UTM & referral parameters, events, ingestion).
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-**Attribution** refers to [event-based analytics](/data/events/overview) about where, how, and when users interact with links, sites, and apps (touchpoint trackers, UTM & referral parameters, events, ingestion).
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-**Identity** refers to the resolution of user activity into a single [unified profile](/features/wallet-intelligence/wallet-profiles) (sessions, demographics, wallets, onchain data).
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Spend less time building analytics and leave the complex data engineering to us.
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Formo helps you understand the impact of touchpoints in each user journey using single-touch attribution, crediting either the first or the last touchpoint within the lookback window.
| User journey | Consists of touchpoints and the conversion event. It is possible for a conversion event to have no corresponding touchpoints (eg. utm parameters). In this case we consider it a 'direct' conversion|
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| Conversion | The primary event you're interested in attributing. Typically a volume or revenue generating conversion event such as "Mint" or "Swap" or "Stake".|
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| Touchpoint | Actions (events) a user's taken or exposed to along the journey before doing the conversion event. [Eg. does event A → B → C → D (conversion event) in a 7 day period; For a lookback window of 7 days, A, B, C are all considered touchpoints]|
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| Lookback window | The time window where a user's events with this attribution property are counted towards the calculation. The window ends when the conversion metric happens.|
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| Term | Definition |
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| :-- | :-- |
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| User journey | Consists of touchpoints and the conversion event. It is possible for a conversion event to have no corresponding touchpoints (eg. utm parameters). In this case we consider it a 'direct' conversion |
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| Conversion | The primary event you're interested in attributing. Typically a volume or revenue generating conversion event such as "Mint" or "Swap" or "Stake". |
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| Touchpoint | Actions (events) a user's taken or exposed to along the journey before doing the conversion event. \[Eg. does event A → B → C → D (conversion event) in a 7 day period; For a lookback window of 7 days, A, B, C are all considered touchpoints\]|
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| Lookback window | The time window where a user's events with this attribution property are counted towards the calculation. The window ends when the conversion metric happens. |
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