The term performance marketing, or performance-based marketing, has been around for over a decade, but the concept and meaning behind it has drastically changed, especially over the past few years. Even today it has slightly different definitions depending on who you’re talking to.
Today we’ll give you our definition of performance marketing, how you can use it to your advantage and quick tips for implementing your own performance-based marketing strategy
in the new year.
What is performance marketing?
Performance marketing is a strategic way of conducting marketing activities that encapsulates nearly all measurable digital marketing tactics. It combines social media, search engine marketing, content and email and marketing automation. All of these things have one thing in common: their measurability. Taking and analyzing data on these efforts allows for a cleaner ROI to make the most of your investment.
Anyone who has worked in marketing within the past 20 years will tell you the industry is increasingly data driven. For marketers looking for a way to prove success beyond the shadow of a doubt, performance marketing is the answer.
What makes performance marketing special?
Performance marketing stands out from other marketing tactics because it includes only those tactics that can be precisely tracked in clicks, conversions and sales. Compare this to other forms of marketing like print or TV ads
where the goal is often to build less quantifiable metrics like brand awareness or goodwill and you do not control who sees your ads.
With performance marketing, you not only have control over your message, you have control over who sees it down to their gender, job and online behavior. This precision is what makes a performance-based strategy stand out, especially among marketers who are required to prove success to managers and CMOs. It definitely sounds better to say “We saw 67 clicks on our Facebook ad which reached 4,699 people and cost $100” instead of “We spent $15 million on a Super Bowl commercial spot
and all we can tell you is that a lot of people saw it.”
Where did the term performance marketing come from?
When the concept of performance-based marketing first took shape back in the 2000s, it was limited to pay-for-performance advertising and affiliate marketing. Over time and with the advancements in digital marketing technology, it has grown to encapsulate nearly all measurable marketing strategies which improve the performance of your brand, bringing together executions across a range of digital channels.
Why put your message out in one Facebook ad when you can disseminate it over an email drip campaign, PPC ad campaign
and three different LinkedIn ads?
The performance marketing process
If this performance-based marketing thing is sounding pretty good to you, it’s time to get started on developing your own strategy for 2021. The following process will identify where your budget is best spent and scale your efforts based on performance data and your organization’s goals.
1. Define your goals and objectives.
On a company-wide scale, define your goals and objectives, getting as specific as possible. Seriously, get really specific. “Grow social media channels” should become “Grow our Facebook audience to 50,000 followers” and “Increase sales” should transform into “A/B test PPC ads quarterly and optimize to reach 1 million impressions in 2021.”
Performance marketing is all about those numbers, so break out your calculators, alert your department’s resident math nerds and get goal setting.
2. Determine your channels.
Next, determine which channels you will use to achieve your goals. Some, like the examples above, may be obvious. To grow your Facebook followers, you should make use of Facebook ads
. To achieve your PPC ads goal, you should use PPC ads. The trick here is to avoid using too many channels or using channels for the sake of using them.
Revisit your buyer personas and strategize where your customer is, then meet them there. If this means you’ll have to adjust some of your goals in Step One (You can’t grow your Facebook audience if the audience just isn’t there!), then so be it.
3. Create a campaign with messaging.
Now that you have your big picture company goals and a list of the performance marketing channels you will use to achieve them, it’s time to strategize a specific campaign. Set some specific campaign objectives on a smaller scale than your company-wide goals. For example, your campaign strategy could be to set one PPC ad set to A/B test success in showcasing a new product to your audience.
Be sure to craft universal messaging around your campaign objectives that you can then tailor to each channel. Your campaign shouldn’t just meet your audience where they are, it should speak to them in a manner they understand and resonate with as well.
4. Execute your campaign.
Hit that launch button! You can launch your campaign all at once or over the course of a few days. If this is your first time using certain performance marketing tactics, we suggest launching over the course of a few days. Rushing the process leaves too much room for mistakes, and a numbers-driven strategy needs accuracy.
5. Gather and analyze data.
Let your campaign run for a certain amount of time, depending on the channel. We suggest at least one month unless your ad is absolutely tanking. If your results could be classified as “abysmal” a week after launch (we’re talking only a handful of impressions or zero clicks), you may want to make some tweaks. Otherwise, spend your budget, ride out the campaign’s course and analyze your data.
Report on your success in relation to your Step One goals. Use detailed attribution and closed loop reporting to see exactly where your budget is going and what it’s getting you. Did you see success? Why or why not?
6. Optimize, rinse and repeat.
Once you’ve reached this step, it’s time for every marketer’s favorite game: rinse and repeat. Circle back and make optimizations to your campaign based on your data, then relaunch with your changes in place. With continuous iteration and improvement, your results will improve overtime. This continuous improvement
is a main goal of performance-based marketing.
Four performance marketing tips for 2021
Performance marketing is a numbers game that’s always evolving. Use these tips to keep up with your competition right out the gate.
Break down your silos
Performance marketing is nearly impossible to execute when your tactics are siloed off from each other. The process requires collaborative strategy and teamwork. At the very least this ensures consistent messaging, but it also helps to ensure all tactics are aligned with the same strategy and same goals. Create an integrated approach to your execution that brings different people to the table to work together.
Give your “rinse and repeat” deadlines
Too often we see marketers get off to a great start on performance marketing, then reach step six and putter out like an old engine. To prevent this, treat your rinse and repeat like a project and give it deadlines. Specify a date for reporting, dates for determining your optimizations, a date for relaunching the campaign, etc.
Educate your team
The platforms used to execute on performance marketing strategies are constantly changing and introducing new features. Make trainings, workshops and time for reading educational materials a priority in your company. It’s too easy to fall behind the competition on so many fronts, and knowledge is your best tool for getting and staying ahead.
Partner with a performance marketing agency
Performance marketing is a great way to bring in outside experts to augment and improve on your existing marketing performance and then tangibly show how marketing is making an impact on your organization's goals. If you’re looking to partner with an experienced team well-versed in creating and executing performance-based marketing strategies, look no further.
Click here to learn more about thunder::tech’s specialized performance marketing services.