If you are a marketing enthusiast, you probably are aware of all the hype performance marketing has recently gotten due to inevitable and faster results. The hype has been so evident that some of the best digital marketing courses that offer an MBA in Digital Marketing have tweaked their syllabus to include a Performance Marketing schedule. So what is a performance marketing and how can brands and marketers use this tool to their advantage? Here’s a guide on performance marketing that will give you a complete understanding of this concept.
What is Performance Marketing?
Performance marketing is a type of digital marketing that focuses on the end goal, which is to drive conversions.
Performance marketers are the most analytical and data-driven members of the digital marketing team. They look at all aspects of a campaign to see what’s working and what’s not. Performance marketing is different from other types of digital marketing because it focuses on the end goal: conversions.
In order to be successful with digital marketing, it’s important to understand the numbers. Businesses using digital marketing are able to measure four standard metrics: click-through rate (CTR), conversion rate, average order value, and lifetime value. These all are important metrics for Performance Marketing.
Importance of Performance Marketing for Businesses
Performance marketing is the most cost-effective form of marketing. It helps businesses to generate leads, increase brand awareness and drive sales.
Performance marketing is a relatively new form of marketing that has emerged in the past decade or so. This type of marketing is also called digital marketing and it is a subset of digital advertising. The main goal of performance marketing is to engage with potential customers and drive them to take some kind of action, such as making a purchase or filling out a contact form.
The benefits of performance marketing are many, but the three main ones are: it’s more cost-effective than other forms of advertising; it’s interactive, and it’s measurable.
- Cost effective: The cost of a performance campaign, which is typically an ROI-based model and the only one most advertisers use, can vary. It can be as low as $0.10 per visitor to as high as $1.00 per lead if it’s a very highly targeted campaign that drives lots of qualified traffic.
- Interactive: Performance marketing is a great way to engage your audience and build relationships. For example, can you think of a better way to brand yourself than by being the first one in line when your favorite band releases its next album?
- Measurable: Performance marketing allows you to measure your return on investment. This enables advertisers and marketers alike to know exactly what’s working, what’s not, and what different campaigns are costing.
Top Performance Marketing Strategies in 2022
Marketing strategies are always changing and evolving with the market. It is important to keep up with the latest trends in order to stay ahead of competitors. In this article, we will explore some of the top performance marketing strategies in 2022.
Use AI-powered tools for marketing automation
Artificial intelligence has been around for a while now and it is being used more and more in marketing automation. In 2022, it will be widely adopted by marketers as a way to automate tasks like lead scoring and lead nurturing.
Create personalized customer journeys
Personalized customer journeys are not just about sending different messages to different people based on their interests or demographics. They are about creating a seamless experience that moves customers from one stage of their journey to the next without any friction or confusion.
More focus on the customer experience
Experience marketing is all about building relationships with customers in a way that helps them feel like they are not just another statistic. It is about more than just selling a product and providing excellent service.
Implementation of richer, interactive content
Interactive content will become more prevalent in 2022 as marketers use it to enhance the customer experience and therefore increase engagement and push them higher into becoming potential customers.
How to Measure the Performance Marketing Campaign Results?
Performance marketing is the type of marketing that is focused on improving the performance of a company’s marketing campaigns. It can be measured by analyzing the traffic, conversion rates, and cost per lead.
There are four types of performance marketing metrics: traffic, conversion rates, cost per lead, and cost per conversion.
- Traffic – how many people visited your website in a given time period.
- Conversion Rates – the number of people who completed a specific action on your website.
- Cost Per Conversion – the cost per person who converted to a sale/lead on your website.
- Cost Per Lead – the cost of generating leads from your website
We can measure these metrics in two ways: top-down or bottom-up.
Bottom-up measurement is when we measure how much money was spent to generate a certain amount of leads.
Top-down measurement is when we measure how many leads were generated for a certain amount of money spent on advertising.
Performance Marketing is slowly becoming a model that brands, both big and small, are adapting to increase their scope of lead generation and nurturing. This can be an equal counterpart to the creative marketing phenomenon that actually attracts an audience to a website or other online channels. Hope this insightful guide on performance marketing helped you understand its importance, top strategies, and campaign metrics!