Performance marketing or performance based marketing is a term that gets thrown around a lot in the digital marketing world. But what is it, really? Performance marketing is a type of internet marketing in which advertisers pay publishers only when there are measurable results. In other words, it’s a results-based approach to marketing.
If you’re thinking of getting into performance marketing, or if you’re already dabbling in it and want to learn more, this blog post is for you. I have outlined 16 things you need to know about performance marketing, from how it works to how to get started.
Read on to learn everything you need to know about this exciting and effective marketing strategy and gain performance marketing insights!
Performance-based marketing examples
Marketing professionals do more than just talking on a microphone. They rely heavily upon paid channels, including:
Google Ads: You can use Google Ads to drive traffic to your website or landing page through paid search results in the Google search engine platform.
Microsoft Bing Ads are similarly used to Google Ads to drive traffic to your website or landing page through paid search results in the Bing search engine.
Native advertising are Ads that look and feel like the content they’re interrupting; sponsored posts where companies pay individuals or publications to put their name into something (examples include Whole Foods’ “Real Macaroni And Cheese”)
Affiliate marketing has been around since before Google came along as well-you can make money by referring people who then buy products at wholesale prices once you hit your minimum spending requirement! Social media platforms also provide great opportunities for marketers, such as:
Facebook Ads are a form of advertising that allows businesses to target Facebook users with ads that are relevant to their interests. These can be highly effective because they are very targeted, and Facebook users are generally receptive to ads that are relevant to their interests.
The Facebook Ads platform is also very user-friendly, and businesses can easily create and manage their Facebook Ads campaigns. Overall, Facebook Ads are an extremely effective way for businesses to reach their target audiences on Facebook.
Instagram Ads are a great way to reach out to potential customers on Instagram. They allow you to target a specific audience and promote your product or service in a creative and visually appealing way. They are highly effective and can help you reach your target market more effectively than other forms of advertising.
However, Instagram Ads can be costly, so it is important to consider your budget when planning your Instagram marketing campaign. Overall, Instagram Ads are a great tool for businesses and can help you reach your target market more effectively.
Twitter Ads are a great way to reach a wide audience with your message. Twitter Ads allows you to target your ads to specific audiences, and you can even create custom audiences based on interests, demographics, and behaviors.
Twitter Ads also gives you the ability to track the performance of your ads, so you can see how well they are doing and make adjustments as needed. Twitter Ads is an effective way to reach numerous people with your message, and it is a tool that every business should consider using.
LinkedIn Ads allow you to target LinkedIn users with specific characteristics, such as job title, company size, or location. LinkedIn Ads also allow you to target LinkedIn groups, which can be a great way to reach a specific audience.
LinkedIn Ads can be a great way to reach professionals and decision-makers who are hard to reach through other channels. LinkedIn Ads are also cost-effective, thanks to LinkedIn’s auction-based pricing system. If you’re looking for a way to reach LinkedIn users, LinkedIn Ads is a great option.
Paid media is only one part of the performance marketing equation. The other part is organic or unpaid traffic, which comes from Search Engine Optimization (SEO).
Search Engine Optimization (SEO)
SEO is the process of optimizing your website and its content to rank higher in search engine results pages (SERPs). The goal of SEO is to drive more organic traffic to your site.
There are a number of factors that go into SEO, including on-page factors (like keyword optimization) and off-page factors (like link building). If you want to learn more about SEO, I will soon have a blog post that can help get you started!
1) What is performance marketing?
Performance marketing is a type of internet marketing in which advertisers pay publishers only when there are measurable results. In other words, it’s a results-based approach to marketing.
This means that performance marketers only get paid when their efforts result in a conversion, such as a sale, a lead, or a click. This makes performance marketing a very effective way to market, as it ensures that advertisers only pay for results.
2) How does performance marketing work?
Performance marketing works by aligning the interests of the advertiser and the publisher. The advertiser wants to get their product in front of as many people as possible, and the publisher wants to make money.
The publisher agrees to promote the advertiser’s product on their website, and the advertiser agrees to pay the publisher a commission for every sale, lead, or click they generate. This alignment of interests ensures that both parties are motivated to produce results.
3) What are the benefits of performance marketing?
There are many benefits of performance marketing, but the two main ones are that it’s effective, and it’s efficient.
Performance marketing is effective because it’s a results-based approach. This means that you only pay for results, so you know that your marketing efforts are actually working. The efficiency comes from its consistency.
In addition, performance marketing is efficient because it allows you to track your results and optimize your campaigns in real-time. This ensures that you’re always making the most of your marketing budget and getting the most bang for your buck.
4) How to get started with performance marketing
If you’re thinking of getting started with performance based marketing, there are a few things you need to do in order to set yourself up for a good start.
First, you need to find a good network to work with. A good network will have a variety of offers for you to choose from and will provide you with the tools and support you need to succeed.
Once you’ve found a good network, you need to create effective campaigns. To do this, you need to know your target audience and what type of offer will appeal to them. Once you have this information, you can create an ad that speaks directly to your audience, and that includes a call-to-action that encourages them to take the desired action.
Finally, you need to track your results and optimize your campaigns in real-time. This will help you ensure that you’re always making the most of your marketing budget and getting the most bang for your buck.
5) The different types of performance-based pricing models
There are four main types of performance-based pricing models:
Cost-per-click (CPC)
it’s the most common type of performance-based pricing model. Under this model, the advertiser pays the publisher a commission for every click they generate.
Cost-per-lead (CPL)
is another common type of performance-based pricing model. Under this model, the advertiser pays the publisher a commission for every lead that they generate.
Cost-per-sale (CPS)
is less common than CPC and CPL, but it’s still used by some advertisers. Under this model, the advertiser pays the publisher a commission for every sale they generate.
Cost-per-action (CPA)
is the least common type of performance-based pricing model. Under this model, the advertiser pays the publisher a commission for every action that they take, such as signing up for a free trial or filling out a form.
6) The different types of performance-based marketing channels
There are three main types of performance-based marketing channels: Affiliate Marketing and Paid Search.
Affiliate marketing is the most common type of performance-based marketing. Under this model, the advertiser pays the publisher a commission for every sale, lead, or click they generate.
Paid search is just as common as affiliate marketing, but it’s still used by many advertisers. Under this model, the advertiser pays the publisher a commission for every click they generate.
Native advertising is another type of performance-based marketing, but it’s not as common as affiliate marketing or paid search. Under this model, the advertiser pays the publisher a commission for every click, lead, or sale they generate.
7) The difference between CPA, CPC, and CPM pricing models
CPA, CPC, and CPM are all pricing models that are based on performance. However, there are some key differences between these pricing models.
CPA is a cost-per-action pricing model, which means that the advertiser pays the publisher a commission for every action that the user takes.
CPC is a cost-per-click pricing model, which means that the advertiser pays the publisher a commission for every click that the user makes.
CPM is a cost-per-impression pricing model, which means that the advertiser pays the publisher a commission for every thousand impressions that the ad makes.
8) The best practices for performance-based campaigns
There are a few best practices that you should keep in mind when running performance-based campaigns:
- Keep your target audience in mind: When creating your campaign, make sure to keep your target audience in mind. What type of offer will they be most interested in? What type of ad will speak to them?
- Test, test, test: Always test your campaigns before you launch them. This will help you fine-tune your campaigns and ensure that they’re as effective as possible.
- Monitor your results: Make sure to monitor your results so that you can optimize your campaigns in real-time. This will help you get the most out of your performance-based campaigns.
- Use multiple channels: Don’t just rely on one channel for your performance-based campaigns. Use multiple channels, such as paid search, affiliate marketing, and native advertising.
- Be patient: Performance-based campaigns can take some time to ramp up. Don’t expect instant results; be patient and give your campaigns time to work.
9) What factors to consider when choosing a performance network
here are a few factors that you should consider when choosing a performance network:
The type of offers that they have: Make sure that the network has offers that are relevant to your target audience.
The type of traffic that they generate: Make sure that the network generates the type of traffic that you’re looking for.
The quality of their traffic: Make sure that the network generates high-quality traffic that is likely to convert.
Their reputation: Make sure to research the reputation of the network before you partner with them.
10) The most common mistakes made in performance marketing
There are a few common mistakes that marketers make when it comes to performance marketing:
Not testing their campaigns: Always test your campaigns before you launch them. This will help you fine-tune your campaigns and ensure that they’re as effective as possible.
Relying on one channel: Don’t just rely on one channel for your performance-based campaigns. Use multiple channels, such as paid search, affiliate marketing, and native advertising.
Not monitoring their results: Make sure to monitor your results so that you can optimize your campaigns in real time. This will help you get the most out of your performance-based campaigns.
Failing to be patient: Performance-based campaigns can take some time to ramp up. Don’t expect instant results; be patient and give your campaigns time to work.
11) How to avoid self-referral fraud in performance marketing
There are a few things that you can do to avoid self-referral fraud in performance marketing:
Monitor your traffic: Make sure to monitor your traffic closely. If you see a sudden spike in traffic, it could be an indication of fraud.
Verify conversions: Make sure to verify all conversions. If you see a conversion that you can’t verify, it could be an indication of fraud.
Require identification: Make sure to require identification from all users. This will help you to weed out fake accounts and prevent self-referral fraud.
12) How to track conversions in performance marketing
There are a few things that you can do to track conversions in performance marketing:
Install a tracking pixel
Install a tracking pixel on your website so that you can track when users visit your site.
Use conversion tracking software
Use conversion tracking software to track when users convert on your offers. I will soon post a blog with the 7 best
Monitor your results: Make sure to monitor your results so that you can optimize your campaigns in real-time. This will help you get the most out of your performance-based campaigns.
13) What software to use for tracking conversions
There are a few software options that you can use for tracking conversions:
Google Analytics
is a web analytics service offered by Google that tracks and reports website traffic. Google Analytics is now the most widely used web analytics service on the Internet. It provides information about the number of visitors to a website, the number of page views, the average time spent on a page, the bounce rate, and more.
Google Analytics can be used to track both online and offline conversions, and it can be integrated with Google Ads to track ad clicks and impressions. Google Analytics is a powerful tool that can be used to improve website traffic and conversion rates.
Check here some PPC reporting tools that might be of help.
Google Ads
Google Ads is Google’s advertising platform that enables businesses to reach potential customers through Google’s vast network of sites and apps. It allows businesses to target potential customers based on their search queries, interests, and location. The platform also provides businesses with detailed reports on how their ads are performing, so they can adjust their campaigns accordingly.
Google Ads is an incredibly powerful tool for businesses of all sizes, and it can be a critical part of any digital marketing strategy.
Bing Ads
Bing Ads is a service that allows businesses to advertise on the Bing search engine. Bing Ads allows businesses to target their ads to specific demographics, interests, and even locations. It also gives the ability to track conversions, set up remarketing campaigns and more.
Bing Ads is a powerful tool that can help businesses reach their target audience and grow their business.
Adobe Marketing Cloud
Adobe Marketing Cloud is a paid tool that you can use to track conversions.
Act-On
Act-On is a paid tool that you can use to track conversions.
Wicked
Wicked is a paid tool that you can use to track conversions.
Taboola
Taboola is a paid tool that you can use to track conversions.
Outbrain
Outbrain is a paid tool that you can use to track conversions and so on…
I will make a more comprehensive list in the future. Coming Soon!
14) How to optimize your campaigns in performance marketing
There are a few things that you can do to optimize your campaigns in performance marketing:
- Monitor your results: Make sure to monitor your results so that you can optimize your campaigns in real-time. This will help you get the most out of your performance-based campaigns.
- Test different offers: Try out different offers to see which ones perform the best.
- Test different ad copy: Try out different ad copy to see which performs the best.
- Test different landing pages: Try out different landing pages to see which ones convert the most users.
15) The future of performance marketing
The future of performance marketing is bright. With the advent of new technology, there are more opportunities than ever before to reach your target audience and generate quality leads.
As new platforms emerge, so do new ways to reach your target audience. Here are a few examples of what you can expect in the future of performance marketing:
- Virtual reality: Virtual reality is becoming more and more popular, and it’s only going to continue to grow. With virtual reality, you’ll be able to transport your target audience into your product or service so that they can experience it for themselves. This will be a great way to generate leads and sales.
- Augmented reality: Augmented reality is another growing technology that will allow you to interact with your target audience in a new way. With augmented reality, you’ll be able to overlay digital information on the real world. This will be a great way to promote your products or services.
- IoT: The Internet of Things is a network of physical devices that are connected to the internet. This will allow you to collect data from your customers and use it to improve your performance marketing campaigns.
The future of performance marketing is exciting and there are endless possibilities for what you can do. Stay up-to-date on the latest trends and technologies so that you can take advantage of them and stay ahead of the competition.
16) Glossary of performance marketing terms
I will list a few Performance Marketing terms below. For a more detailed and extensive list, stay tuned 😉
CPA – Cost per action.
A pricing model where advertisers pay for each specified action that is taken by a user.
CPC – Cost per click.
A pricing model where advertisers pay for each user that clicks on their ad.
CPL – Cost per lead.
A pricing model where advertisers pay for each lead that is generated.
CPS – Cost per sale.
A pricing model where advertisers pay for each sale that is generated.
CTR – Click-through rate.
The percentage of users that click on an ad.
Conversion rate
The percentage of users that take the desired action.
ROI – Return on investment.
The ratio of money made to money spent.
PPC – Pay per click.
A pricing model where advertisers pay for each user that clicks on their ad.
SEM – Search Engine Marketing.
A form of internet marketing that involves the promotion of websites by increasing their visibility in search engine results pages.
SEO – Search engine optimization.
The process of optimizing a website for Google search.
KPI – Key Performance Index
Display advertising
A form of internet marketing that involves the use of banner ads, text ads, and other forms of advertising on websites.
Native advertising
A form of internet marketing that involves the use of native ad units, which are designed to blend in with the content of the website.
Affiliate marketing
A form of internet marketing that involves the promotion of products or services by affiliates.
Social media marketing:
A form of internet marketing that involves the use of social media platforms to promote products or services.
Email marketing
A form of internet marketing that involves the use of email to promote products or services.
Performance-based marketing is a great way to grow your online business. By paying for results, you can be sure that your marketing budget is being used effectively.
Additionally, performance-based marketing provides you with real-time data that you can use to optimize your campaigns and improve your Return on Investment (ROI). If you’re looking to get started with performance-based marketing, make sure to choose the right performance network and create effective campaigns.
Conclusion
As you can see, there’s a lot to learn about performance marketing. But don’t let that discourage you – once you get the hang of it, performance marketing can be an extremely effective way to grow your business. So what are you waiting for? Get out there and start testing some campaigns! Who knows, maybe you’ll be the next big success story in the world of performance marketing.
