How To Get Started With Performance-Based Marketing
How To Get Started With Performance Based Marketing
Donna Maurer
If you develop a digital marketing campaign strategy, you may notice that once launched and promoted, it didn’t achieve the results you were hoping to gain. Your marketing budget may also suffer, making it challenging to know what to do.
Your company’s digital performance can monitor progress, allowing you to see what tactics and techniques lead to more conversions, sales, and, ultimately, profits. Performance-based marketing is a vital tool to track essential elements within your digital marketing campaigns, helping to ensure that they work in alignment with your business objectives.
But, what is performance-based marketing, and how do you get started with it? Below is a guide to help you begin performance-based marketing, including the benefits and challenges you may face.
What is Performance-Based Marketing?
Performanc- based marketing is a way to see your results first-hand. Rather than paying for a service every month, you pay when you see the results you set out to get!
But the type of results that you’re looking for matters. Anything measurable for your metrics can be part of what you want to achieve, including the following:
Page/ad clicks
Ad views
App installs
Social media engagement
Downloads
Sales
Marketing teams utilize these metrics to help create and develop a more enticing strategy and manage an SEO project for their audience. You might have to change keywords for Search Engine Optimization, visual ads, or formatting.
The key takeaway with this marketing method is that you get paid for the results, not the effort. All activities are measured, and your team makes informative decisions based on your campaign performance.
What are the Benefits of Performance-Based Marketing?
There are numerous benefits to utilizing performance-based marketing for your organization in your digital advertising. Some of the essential advantages may include the following:
Clear Expectations and Budget Transparency
Your marketing budget will be more direct since it lets you know where your money goes and what results from it. It goes against more traditional forms of advertising, where you pay upfront fees.
Professional agencies utilized for performance-based marketing must deliver on your intended goals; otherwise, they don't get paid. Expectations are understood upfront, so conditions necessary for payment are understood.
Whether your results desire clicks, views, or conversions, you can easily measure the time your prospects spend. You’ll be able to see who interacts with the campaigns and gain insightful feedback through SEO analysis, and marketing ROI. You will be able to identify costs for customer acquisition, leads, and sales.
Better Insight of the Customer
Your target audience is how you reach and connect to create loyal, paying customers for products and services. Those who find value in your offer and where you make an impact are essential to help build the client base.
With performance-based marketing, you get the data you need to understand what your market engages with to determine where adjustments need to happen. It provides a clear path as to where you can focus your marketing efforts.
Low-Risk Option for Marketing and Brand Awareness
Planning your budget happens more quickly with performance-based marketing. You can design and schedule campaigns to utilize your investment with real-time results. With the data you collect, you can quickly make changes that ensure your campaign aligns correctly to bring a positive Return On Investment (ROI).
Creating a recognizable brand is another aspect of your marketing efforts that businesses tend to put focus on building. Performance marketing can help you measure and only pay for specific actions that help generate and increase brand awareness, like social media campaigns and content.
Optimize Goal Setting
The information you need will be readily available, so you can set yourfuture business campaign objectives based on where your business needs to focus. Then you can sit back and monitor the progress as it unfolds.
An excellent example is if you’re in sales and your company relies on lead generation, you can track that and quickly discover what strategies and initiatives give you the most successful (and the most unsuccessful) leads. Then you can make changes to your funnel or marketing tactics to ensure you receive the best results.
What are the Disadvantages of Performance Based Marketing?
Investing in performance based marketing is a wise choice, considering that you pay for what you get. But, if you’re not sure what you need for your organization to be more successful, it may not be the best idea to go with it now.
Some other disadvantages of performance based marketing include the following:
Cross-device difficulty: if your users use iPads, phones, and desktop computers for different parts of researching your organization or viewing campaigns, it can be more challenging to track the user journey accurately.
Missing long-term sustainability: real-time data can cause businesses to under prioritize or neglect more long-term goals since the focus is more on immediate results. Don’t forget to ensure you still have a “big picture” objective across a larger marketing strategy to cultivate and retain customers effectively.
How to Measure Performance Based Marketing?
With every activity and action measured, you can significantly analyze your Key Performance Indicators (KPIs) and look at the overarching ROI. Your campaign results are more understood, and you can implement action plans to improve the performance by analyzing your PPC ads on Google Ads digitally.
Some of the KPIs commonly utilized in performance marketing include:
Cost Per Mille (CPM): the cost the advertiser pays for 1k impressions of a digital ad.
Cost Per Click (CPC): the price paid every time a user clicks on an ad (better engagement than CPM)
Cost Per Action (CPA): measures campaign performance according to the action you want your audience to do, such as subscribing to a newsletter/website, downloading a worksheet, or purchasing a product. Your sales in this fashion are the most tangible and measurable result.
Building Your Performance Marketing Strategy
Now that you understand a lot about performance-based marketing, you can take some steps to help get your strategy underway. These are the main actions to take when building a performance- based marketing strategy for your business:
Set a Goal: establish what you hope to accomplish with your campaign, such as creating more brand awareness, engagement, and web traffic or just selling your product/service.
Choose Your Channels: It’s vital you don’t put all your eggs in one basket, or rather, focus on just one channel for your campaign efforts. Spread exposure and broaden your reach across multiple channels, such as using a social media platform and implementing some display ads.
Create and Promote Your Campaign: identify your audience, understand the solution to the problem you solve, and then craft your messaging and content to address those needs. The better you know your target consumers, the easier it's to create and promote your campaign. Have your teams discuss and determine aspects like ad size, content, images, etc.
Measure and Optimize: Enlist the help fromdigital analytics and measure your metrics to discover where you are performing the best, and then adjust your ad efforts accordingly. Performance marketing campaigns can help you to identify the best channels, clients, and goals to help increase your ROI.
Performance-Based Marketing = ROI
Performance-based marketing campaigns allow your business to measure all aspects of your digital advertising efforts. Proven ROI is at the forefront of utilizing this approach. With all of the information at your fingertips, you can easily adjust and become more attuned to your target audience, optimize your marketing to provide just what they need and ensure great success.
About the Author:
As an experienced content creator, Donna has covered numerous topics in the realms of marketing, music production, and blogging. She has written for various publications and can often be found conducting research for her latest article. Donna spends her free time exploring New York City, where her days are filled with new life experiences and adventures to write about!
