In a perfect world, businesses pay only for advertising that brings in customers. Wouldn’t you just love to limit your marketing spending to cases where customers take action?
You can do that already. With performance marketing.
Performance marketing is a form of online advertising where merchants pay platforms only when customers convert. This result-driven strategy can give a sizable boost to online sales, lead generation, and other marketing goals you might have.
In this post, we’ll answer these questions:
Let’s dive in.
Performance marketing is a strategy that involves online advertising campaigns where advertisers pay only when measurable results are achieved. The common results are clicks, generated leads, or purchases.
Performance marketing was traditionally referred to as “pay-for-performance” marketing and included only PPC (pay per click) or CPC (pay per click) advertising. Now, it also involves campaigns where advertisers measure results also with impressions and views.
This strategy is a highly desirable arrangement for advertisers because they pay only when campaigns achieve results. That’s why performance marketing is a popular advertising strategy that businesses use for targeted omnichannel campaigns.
Affiliate marketing is a type of performance marketing in which an advertiser rewards an affiliate for bringing clicks, views, leads, or sales.
Performance marketing is a broader term that includes more payment models and real-time ROI tracking methods. Besides, the term “performance marketing” also encompasses social media advertising, native advertising, and sponsored content.
Businesses and advertisers use these NUMBER steps to develop Cost per Acquisition (CPA), Cost per Impression (CPM), PPC, and CPC campaigns
Performance marketing is all about measuring results and providing specific results. That’s why advertisers need to discuss what kinds of results they hope to achieve before starting campaigns.
Here are some questions to ask yourself to define measurable campaign goals and milestones:
As you can see, these questions address several essential components: the goals, expectations, timelines, resources, and strategies.
Goal making might seem like an easy task, especially with all the digital marketing tools. What could be challenging is ensuring that campaign performance goals make sense and bring value to your business.
Take CPC campaigns as an example. A super high click-through rate in CPC campaigns is great but doesn’t mean much unless advertisers track actions that happen after clicks. If they don’t track those actions, then they have no idea if the campaign actually brings revenues.That’s why consider using multiple goals to maximize customer lifetime value and have a complete overview of your campaign performance.
Who is your campaign trying to reach? To find the answer, refer to your customer research. You should have a good understanding of the target customer for your campaigns to be able to adjust its settings properly.
Several common customer research strategies:
Whatever customer research strategy you choose, keep in mind that defining the target audience requires data (both qualitative and quantitative). Demographics, location, preferred devices and communication channels, interests, common problems, goals — everything should be backed up with research. The collection of customer data is going to form customer personas. Those are the ideal representations of target customers based on the data you collected. You’ll use the personas to create relevant and engaging content for advertising campaigns.
Once you’ve found your target audience, it’s time to decide how to connect with them. The findings from the customer research might have provided you with some ideas (social media, Google, etc.), which is helpful to make that decision.
The most common traffic channels to target with ad campaigns:
All of these channels are budget-friendly (if you make them), so businesses of all sizes can try them. Once you’ve chosen the traffic channels to target, deciding on KPIs and metrics to measure the results is the next step. Dashboards would be very helpful here because they provide a constant performance overview.
Your campaign is ready to start at this point. The only thing left is to create the actual content – designs & text for ads and landing pages.
Tips for creating campaign ads:
Tips for creating campaign landing pages:
Regardless of the content you’re creating, the best tip is to make it about the customer. This is the best strategy to grab their attention and consider clicking your ads.
KPIs are metrics that measure essential performance indicators of advertising campaigns.
Thanks to online monitoring tools, you can track many KPIs and evaluate your marketing performance. But some KPIs might not be relevant to your campaign goals, it’s important to define the ones that are and focus on them.
Here is the list of the most common KPIs for evaluating campaign performance:
Online advertising tracking tools allow you to monitor these KPIs automatically, so you could manage your campaigns more effectively. Consider using all the above-mentioned six KPIs – they will tell you if you’re moving in the right direction.
Your online advertising expert might advise you to run multiple versions of ads, which you should absolutely give the green light to. Testing different ads means looking for what attracts customers more effectively, therefore, is more relevant to them.
So, try at least two different performance campaigns to see what works best. Keep a close watch on how both perform, and make improvements as you go.
Performance marketing is becoming more popular in online business, and for a good reason. This strategy gives an opportunity to get measurable results down to individual clicks and conversions, which is a big win for merchants.
Tracking performance marketing campaign results means knowing that you’re spending your money wisely. If you follow these seven steps to build a performance marketing strategy, you’ll cover pretty much all bases.
Consider trying it for your online business – it’s a good way to build your brand, increase product awareness, and engage with more customers for a reasonable cost.
Author’s bio. Jessica Fender is a copywriter and blogger at GetGoodGrade with a background in marketing and sales. She enjoys sharing her experience with like-minded professionals who aim to provide customers with high-quality services.