In this rapidly developing digital world, online marketing has become the primary mode of marketing. It helps businesses reach a wider audience and collect invaluable data that can be used to shape future marketing campaigns and strategies.
One such type of online marketing is performance marketing. So, what is performance marketing? What are its benefits, and what strategies can you use to get the most out of performance marketing? Let’s dive in to learn some performance marketing strategies you can use in 2023 and take your business to the next level.
Performance marketing refers to online marketing where advertisers pay based on the number of clicks or conversions through their ad campaigns. It is also referred to as pay-for-performance advertising or performance-based advertising.
Performance marketing is a completely data-driven way to advertise your products or services that lets you pay only when the customer takes a particular action. It ensures that your money is well-spent and generates high ROI for your campaigns.
Some of the popular channels where you can implement your performance marketing strategy are
- Search Engine Marketing (Google, Bing, etc.)
- Social Media Marketing (Facebook, Twitter, LinkedIn, etc.)
How does performance marketing work?
A successful performance marketing campaign depends upon the combined work of four groups.
- Retailers or merchants
- Affiliates or publishers
- Affiliate network and third-party tracking platforms
- Affiliate managers or OPMs (Outsourced Program Management).
All these groups are interconnected and work together to make the performance marketing campaign successful.
1. Retailers or merchants:
Also referred to as advertisers, they are the brands selling products or services. They work with affiliates and try to promote their brand by generating more sales or leads.
2. Affiliates or publishers:
Also referred to as marketing partners, affiliates are companies that own and operate media channels like social media accounts, blogs, websites, etc. They use their channel or platform to promote the advertiser’s products and services.
3. Affiliate network and third-party tracking platforms?
Affiliate networks or third-party platforms are a one-stop destination for marketing tools and resources like banners, campaign performance tracking, text links, etc. They help keep advertisers and publishers on one page regarding clicks, conversions, tracking leads, etc.
4. Outsourced Program Managers (OPM):
Outsourced Program Managers are firms and agencies that offer full-time performance marketing services for brands that don’t have the necessary workforce to do it in-house.
Some performance marketing strategies to boost your business in 2023:
Here are some of the top performance marketing strategies you can implement to grow your business in 2023 now that you know what performance marketing is and how it works.
1. Dynamic remarketing:
While remarketing allows you to show ads to people who have visited your website before, dynamic remarketing allows you to show ads for the services or products that they have viewed on your website before.
Dynamic remarketing lets you provide customized ads based on their behavioural data to your viewers. Since the viewer has already shown interest in your product or service, they are more likely to convert and buy it through dynamic retargeting.
Here are some points you should take into account before implementing dynamic remarketing.
- Give them a reason to buy your product. Make sure to add a compelling call to action while displaying the products that your viewers are interested in.
- Maintain the frequency of your ads. Limit the number of times your viewers will see your ads in a day not to overwhelm or irritate them.
2. Affiliate marketing:
A subset of performance marketing, affiliate marketing is the process where the affiliate or publisher earns a commission for marketing the advertiser’s products or services. The affiliate promotes the products and earns a share of the profit for each sale they make.
Affiliates can be in any form, such as blogs, coupon websites, product review sites, apps, etc. Affiliate marketing is low-risk and flexible. It is a cost-effective method where you only pay the affiliate for each sale, click or view of your page or product.
3. Influencer marketing:
Influencer marketing is one of the most effective and fastest ways to gain more customers. By collaborating with online celebrities or influencers to endorse your product, you can tap into their audience and expose your brand to a wider audience.
Choosing the right influencer for your brand can help you increase website traffic, gain more sales, and increase conversion. Choose influencers who have a good impact on their audience, and select the right social media platform that’s more likely to reach your target market.
4. Visual search:
Many websites have enabled visual search, allowing customers to use their smartphone camera as a visual discovery tool. This helps customers search for their desired products without the need to type out their names.
Following Google Lens and Pinterest Lens, Amazon, Microsoft, and Instagram have also invested in visual search. Visual search on your website will make the customer’s purchase journey smooth and short. Create more impactful visual content to make them stand out among other digital images and graphics.
5. Search Marketing:
Paid search is one of your top marketing strategies to reach your audience. Investing in paid ads that appear at the top of a search engine result page can help drive customer action and engagement for your brand.
With so much digital content available, organic ranking is becoming more challenging. Sponsoring your ad or marketing content can guarantee that it ranks well for your target keywords. Following this, you are charged every time a user clicks on your ad.
6. YouTube Shopping:
When customers want to learn about a product or service, they first go to YouTube. Previously, customers had to go to different platforms or websites to buy the product they searched for on YouTube.
But now, Google is posting relevant ads on YouTube’s home page and search results to make it easier for customers to purchase the product they are searching for on YouTube. Now, whenever a customer searches for a product or its reviews, ads for that product will appear in the search results.
You can use YouTube shopping to introduce your products to customers when they are looking for them.
7. Amazon Advertising:
As the largest shopping website today, Amazon allows you to boost your visibility with your audience. It can be used as an advertising platform to increase sales and brand awareness. You can advertise through Amazon in two ways.
- Like Google paid ads, you can pay for your product to appear at the top of the relevant search results.
- You can use the Sponsored Brands feature to secure top rank for category keywords or brand names.
8. Social media likes and followers:
With most people spending most of their time on social media platforms, it is an effective way to promote your business to your audience. Having more likes and followers for your products and page can positively impact your new audience.
Facebook lets you increase the number of likes for your page, boost a specific post, or put banner ads that will be shown only to the targeted audience. It’s a cost-effective method that can help you boost campaigns and page likes. Increasing page likes can help with branding and consumer engagement. Similarly, you can increase your following on Twitter through paid campaigns.
Benefits of performance marketing:
As an effective way to develop your business by making your audience take specific actions, performance marketing provides various benefits. Some of the benefits you get through performance marketing are:
As discussed earlier, you only need to pay based on the results obtained from your ad campaign. This saves you money while letting you compete in online marketing efficiently.
Track and analyse data efficiently:
Since performance marketing is result-oriented, it allows you to track and monitor ad campaigns easily. You can use the data analytics tools available to know which ads are performing well and which are not and optimize accordingly.
Reach a wider audience:
Performance marketing is an effective way to target new customers and expose your brand to a wider audience. You can use publishers like social media, search engine marketing, and websites to promote your brand to relevant customers.
The success and failure of a performance marketing campaign are centered around its ROI. The better the performance of an ad campaign, the higher the chances of success. This helps promote the brand while simultaneously increasing sales and generating leads.
You can always know how your campaign performs with the analytical tools available. This helps you optimize the content, reduce risk, and increase launch times.
Unlike other types of marketing, you don’t have to pay a huge sum of money at the beginning of the campaign. You only need to pay when your campaign is live and you have achieved your desired marketing goal.
How do you measure the success of performance marketing?
Being able to track and analyze the performance of your campaigns is one of the benefits of performance marketing. Here are some of the most commonly used metrics to measure performance marketing pricing.
- Cost Per Acquisition (CPA): The amount the advertiser pays when customers complete the desired action. E.g., a click, a purchase, etc.
- Cost Per Millie (CPM): The amount the advertiser pays per one thousand impressions. Rather than action, this metric charges based on the number of people who have seen your ad.
- Cost Per Click (CPC): The amount the advertiser pays based on the number of clicks on their ads.
- Cost Per Lead (CPL): The amount paid when the customer fills out a form or signs up for something. E.g., email newsletter, subscription, etc.
- Cost Per Sale (CPS): The amount the advertiser pays for every sale generated by an ad campaign.
- Lifetime Value (LTV): The amount that an advertiser anticipates a consumer will spend over the course of their engagement with their brand.
The biggest advantage of performance marketing is that it can be measured, tracked, and analysed and is more flexible than other marketing methods. It is an innovative and result-oriented method that can help you reach a wider audience and grow your business. So this 2023, invest in performance marketing and start developing your business.