Let’s say you are a business with a niche customer base. You sell them what they want when they want it. That means you need to know what kinds of people are in your target market and how they are likely to behave.
But online marketing isn’t that simple. There is no perfect way to reach your audience.
A successful digital marketing agency can help you collect the right data, analyse your audience behaviour, and create multiple winning marketing strategies to get you past the web of algorithms.
But that still won’t guarantee conversions, given the number of external factors that influence consumer buying decisions. It is a risk that all marketers ought to take.
That being said, you can mitigate that risk by delivering accurate and valuable product information to your audience when they are the most receptive and interested – using performance marketing.
Performance marketing lets advertisers take control of their marketing activities by letting them determine how much value they deliver while driving real consumer value into their messaging, target audience, and product offering.
It allows businesses to target the people who will appreciate their products and services the most, so they can measure and improve the effectiveness of their digital marketing efforts – quite literally carrying out marketing campaigns based on performance.
By putting a dollar value on various digital marketing initiatives, performance marketing can convert more passive audiences into actively involved ones.
It can successfully harness the collective intelligence of various data sources and optimise your marketing strategies while lowering the overall costs for result-driven marketing.
Benefits of performance marketing
Good digital marketing should be all about measurable results – usually expressed in terms of leads or sales conversions. Whether you are seeing big spikes in traffic or noticing a dip in your email subscribers, performance marketing campaigns are a good way to measure how effective your content strategy is on a daily basis.
Here are some benefits of using performance marketing for your business.
- Real-time insights: You can make changes to existing products or services or improve the overall quality of customer service by reducing wait times by tracking how your target audience responds to your business offerings in real-time.
- Alter as you go: Instead of waiting until your ad has run and been shown to be effective, performance marketing lets you measure the effectiveness of every step in your campaign, including where and how much demand there is for your product or service.
- Low risk: Performance marketing focuses on increasing sales and profit while reducing costs by eliminating big marketing mistakes. This may all be done through a combination of strategic planning, salesperson training, and data harvesting from the customers’ search patterns.
- ROI-focused: Analysing where your advertisement spends is going and measuring the return on your investment is one of the major benefits of performance marketing.
How to use performance marketing for your business
In the world of online advertising, performance is everything. Every click, every download, and every customer acquisition channel counts toward your monthly performance goals.
Whether you are tracking clicks, page views, impressions, or CPMs (cost per thousand impressions), the buzz around performance marketing, which has grown exponentially in the last few years, is real.
And as digital marketing agencies are recognising the benefits of putting more resources behind improving their sites’ performance, performance marketing is actually helping them drive repeat customers for their business.
Below are some performance marketing channels that your business can profit from.
Social media advertising
If you have been thinking about investing in social media, it is worth taking a second to understand why social media has become so important to brands.
Performance Marketing is widely used by companies to drive traffic to their websites via Instagram, Pinterest, and other platforms. This type of marketing is different from personal marketing because it is based on genuine curiosity from users rather than being launched with the goal of keeping users engaged.
Instead, you can measure engagement, likes, clicks, and sales on your social media channels to see how effective your performance marketing is.
Native advertising uses the native interface of a website or application as part of an attempt to generate revenue from users who might otherwise not be interested in paid content. That’s why they neither look at display ads or banner ads or any kind of ads.
It actually presents users with products or offers they might be interested in while trying to mimic the organic look and feel of a website. So, they look like they are part of your regular content, not ads.
Using performance marketing, you can run analytic tests on native ads to see how much it costs you to place an ad on particular pages and measure their returns against the ads on your other channels.
Affiliate marketing works well for bloggers because they have an audience who are interested and willing to read their blog posts. It works well for businesses because they can generate a lot of traffic from a small pool of potential readers, reselling the ads to those people who actually click through to buy the products.
Businesses generate revenue through their affiliate bloggers whereas the bloggers get paid commissions when their readers make purchases after visiting their affiliate business’ site through their programs.
This already is a profitable arrangement for everyone involved. But when you use performance marketing to track your affiliate’s performance, you know exactly which affiliate partner you should focus your resources and investment on if you want to accelerate your business’ growth.
Search engine marketing
Performance marketing in Search Engine Marketing is used when you want to improve the visibility or demand for a product or service in the search engines. The idea is to find patterns in a website’s activity and then pull out relevant information that could help your business.
This could be real-time information about traffic sources, page views, or ads running on other websites. You could then use this to figure out which aspects of your site are making visitors click and take control of your ROI.
Performance marketing is all about making what your business does well visible to your target audience, analysing your KPIs, and measuring their results. You don’t have to devote 100% of your budget to performance marketing. But if you are experiencing short-term funding issues, you can use this strategy to boost your sales without experimenting with your campaigns.