Introduction
Performance marketing is an all-encompassing term for online marketing, and advertising programs where businesses pay only when a particular action happens. Several actions could be included in this such as sales, click, or lead generation, etc.
The professionals involved in performance marketing rely on paid marketing platforms such as affiliate marketing and search engine marketing.
This article will help you understand what performance marketing is, how it works and the strategies you can use for your brand:
- How do the Performance Marketing Channels and Platforms Work?
- Strategy for Performance Marketing
- Best Performance Marketing Channels to Opt for
- Performance Marketing and Brand Marketing
- Performance Marketing and Programmatic Marketing
How do the Performance Marketing Channels and Platforms Work?
Contrary to traditional marketing, performance marketing is used to drive, track and measures specific actions. At the same time it attributes to the ROI of each asset, campaign or activity.
Major corporations easily spend millions of dollars on branding and campaigning. The monetary restrictions are faced by smaller businesses for driving any action by their prospects. They have to focus on the bottom line without compromising profits.
Each channel of marketing has a certain audience and offers advertising platforms accordingly. For an Instagram user, the marketing is usually based on short videos and photos. YouTube ads comprise 30 to 50 seconds videos played during each video. Google displays ads in search result pages as well as across the Google Ads network.
Strategy for Performance Marketing
Performance marketing is about paying only for the action. It is cost-effective and shows how much grasp you have on multiple strategies used for this purpose.
1. Cost Per Impression
CPM refers to the amount paid to the publisher per 1000 times their ad is shown.
- Cost Per Click
CPC is the amount the advertiser will pay only when their ad is clicked on.
- Cost Per Sales
CPS is the amount you will pay when a sale is generated directly by an ad.
- Cost Per Acquisition
CPA is the amount you pay when a specific action occurs. The action could be a click, or a form completion or lead generation.
Best Performance Marketing Channels to Opt for
Performance marketing demands action. It empowers small scale industries to measure specific actions. Here are a five of the top performance marketing channels.
- Native Advertising
- Sponsored Content
- Social Media Advertising
- Search Engine Marketing
- Affiliate Marketing
Native Advertising
Native advertising is the door to creating click through options on your website. It will lead people to consume your content. It can get your ten times more clicks as compared to other types of digital advertising.
It offers quality content that will provide value to your customers.
It also leverages distribution through the right kind of publishers.
Sponsored Content
Sponsored content is another great form of native advertising. Sponsored articles will drive quality traffic, such prospects that are genuinely interested in your business and products/services it offers. Sponsored content opens the door for brands to become a natural part of conversations with their prospects.
Social Media Advertising
It is really hard to track results with social media networks, although it is one of the most fruitful platform for promoting your brand and creating brand awareness. Agencies and media professionals are investing in social media ads for performance marketing.
Objectives for social advertising usually include improving:
- Traffic
- Engagement
- Lead Generation
- Sales
Furthermore, the list of social media handles is long: Facebook, Twitter, LinkedIn, YouTube, Pinterest, Snapchat and TikTok etc.
Consider the following best practices for bird eye’s view of how these channels perform and work:
Dive into the targeting options available. This will help you to create specific set of target audience.
Do not forget to create ads that follow organic search needs on each platform. Do not blindly push out promotional content on social media, it will surely back fire.
Do not rush things. Take your time and understand the advantages and disadvantages of each format offered on every social media channel.
Experiment with your bidding strategy. Optimize them every now and then to increase Return on Investment.
Search Engine Marketing
SEM is done to increase visibility and clicks through organic, paid advertisements. Google AdWords program has made social media marketing a popular channel for many years now. SEM enables advertisers to display their ads to customers ready to make a purchase.
Search Engine Marketing heavily relies on keywords. Therefore, you need to select them wisely.
Affiliate Marketing
It is a form of performance marketing. The popular model needs publishers to become an affiliate by developing establishing a relationship with an advertiser for producing traffic or sales or both. Any website operator can be an affiliate for your brand.
Difference between Performance Marketing and Conventional Marketing
In traditional advertising, the advertiser will pay in advance for ad space. The upfront fee is not dependent on performance.
It means the advertiser has spent millions of dollars without witnessing a single conversion. On the other hand, in performance marketing, you pay only for the successful outcomes.
Performance Marketing and Brand Marketing
The challenge in contemporary market is to stand out from the crowd. This is why brand awareness holds such a critical place in marketing. You can increase brand awareness through social media campaigns, native ads, and content marketing, among others. These channels are sub categories of performance marketing.
Performance Marketing and Programmatic Marketing
Programmatic marketing refers to the automated means of buying ad space. It targets specific audience at the most optimal price.
Programmatic marketing has become a central ingredient of performance marketing. It allows advertisers to purchase better placements at reasonable prices and increase their Return on Investment (ROI).
Programmatic marketing also provides detailed reporting and in-depth analysis. Hence, you can explore the performance of the programmatic ads and stay focused on your goals.
Conclusion
Performance marketing is a great alternative for small businesses with a limited budget. You pay for what you get without fearing any loss. Multiple channels can be utilized for performance marketing such as affiliate marketing, search engine marketing, social media advertising and sponsored content.
Through performance marketing you target specific audience who are either willing to convert, or generate leads. The trick is to use the strategy that best serves your goals.
