The top two marketing challenges of today are generating traffic and leads and proving the ROI of your marketing. However, while traditional advertising has the potential to generate traffic, it can yield inconsistent results with little data for measuring its success.
That’s why performance marketing is growing in popularity. It addresses both challenges by generating quality leads while also providing metrics for understanding your results and measuring your financial return from your efforts.
Explore seven top performance marketing strategies every advertiser should consider in their next marketing campaign.
How Do Performance Marketing Strategies Differ from Other Advertising Strategies?
Performance marketing focuses on the results of your advertising. Therefore, you only pay when that action is completed.
Some examples of performance marketing actions include:
- Clicking an ad
- Downloading a digital asset
- Watching a video
- Purchasing a product
When you perform traditional advertising where you pay for ad placement on TV or the radio, you assume all the risk because you’re counting on bringing in a return from those ads. However, when you use performance marketing strategies, you share some risks with the host platform since you only pay when your audience responds.
What Metrics Can You Use to Measure Your Strategies?
There are four primary metrics used for measuring the success of your performance marketing strategies:
Cost Per Mille (CPM)
CPM is how much you pay per one thousand impressions. Rather than charging by an action, you will pay for the eyes on your ad, which works best for calculating the ROI of brand awareness campaigns.
Cost Per Click (CPC)
CPC is a metric marketers can use for measuring the number of people who clicked on the ad when it appeared on their feed. It’s a more concrete measurement than CPM, as it shows when your audience has more significant interest in your message.
Cost Per Action (CPA)
CPA looks at the audience’s response after clicking on your ad. For example, it looks at whether they downloaded a digital asset or filled out a form. These actions convert your traffic into leads, as most actions also collect the audience’s personal information, which you can use for nurturing.
Lifetime Value (LTV)
Some customers, especially B2B customers, take longer before they make a purchase decision. However, when they do, it’s often a high-value purchase. Therefore, you would want to look at that customer’s lifetime value as a loyal customer rather than the value of a small action, as it gives you a broader picture of its impact on your revenue growth.
Where Can You Use Performance Marketing?
Performance marketing is a very flexible advertising strategy with several channel options. For instance, you can post ads on social media, third-party websites, search engine results, and other digital channels. This gives you more options for reaching your audience where they are most likely to respond to your marketing message.
Why Should You Consider Performance Marketing Strategies?
Performance marketing strategies are driven by results, which makes them easy to track and measure your ROI. For example, if your goal is to generate a set number of new leads, you can track that number and only pay for the leads you generate.
Analyzing your performance helps you in more ways than just measuring your returns. You can also use those results to get a more accurate picture of how well the ad performed. For instance, when you play an advertisement on TV, you won’t get any concrete numbers on how many people saw the ad or responded to it. Even if the channel can track the number of viewers at any given time, you still don’t know whether they were present when the ad played and how it impacted their purchase decision.
However, when you use digital performance marketing strategies, you gain a clearer picture of who is seeing your ad and can track their actions after their interaction with the ad, like clicking on any links in the ad or filling out a form.
7 Performance Marketing Strategies You Should Try
Here are seven highly effective performance marketing strategies advertisers regularly use with great success to target their audience and increase their revenue.
1. Affiliate Marketing
Around 80% of brands have an affiliate marketing program. With affiliate marketing, you recruit third parties to promote your products. In exchange, they receive a percentage of the sale. This way, you’re only paying when consumers purchase from your affiliates.
Affiliate marketing requires minimal investment and has little risk as you only pay for sales or leads.
2. PPC Influencer Marketing
Influencer marketing adds more authenticity to your ads because it’s coming from a trusted third party with a loyal following. When you invest in influencer marketing, you pay someone with the power to sway part of your audience’s opinion and pay them to promote your brand and products.
About 93% of marketers use influencer marketing in their campaigns. However, many businesses still struggle to measure the results of their influencer marketing content. While they know there is an increase in sales and brand awareness, they might not be able to translate that boost in numbers.
Turning your influencer marketing campaign into a PPC strategy increases your content’s audience. In addition, it provides metrics you can track and measure when calculating your ROI from influencer marketing.
3. Search Marketing
About 39% of marketing budgets go towards paid searches. It’s one of the top strategies marketers use to reach their audience.
Organic ranking is becoming increasingly difficult with a large amount of digital content available. However, sponsoring your marketing content can ensure it ranks well for your keywords. Then, you pay every time the user performing the search clicks on your ad.
For the best results, use both positive and negative keywords. For example, a coffee distributor might use negative keywords like “coffee shop” so they aren’t paying for clicks from consumers looking for a café and are reaching more of their target buyers.
4. Email Advertising
You can use Google Adwords to run an email campaign. Your emails appear in the recipient’s inbox along with their other emails. However, they are differentiated with an “Ad” tag. You only pay when the recipient clicks on the email to expand it.
About 99% of email users check their email daily, with some checking up to twenty times in one day. In addition, 58% of users check their email before performing other online activities, including social media.
By advertising through email, you bring your marketing content to your target audience instead of depending on them finding you. Additionally, you can increase your click-through rate, which generates leads as you can collect the contact information from those that respond to your email.
5. Social Media Ads
Social media is a cost-efficient and effective way to target a specific audience. Because users on social media share so much information on their profiles, you can use filters to target specific audiences more effectively. For example, you can target your advertising campaign by interests, location, and education level.
Your ads show up in social media feeds along with the user’s other content for a seamless user experience, as it doesn’t disrupt their scrolling.
When you use social media advertising, you pay when your audience clicks on the ad in their feed.
The top social media channels for advertising include:
6. Native Video Ads
One YouTube ad has the potential to reach 2.56 billion consumers. As the second-most visited website in the world, you have an incredible opportunity to get a large audience with your marketing message by advertising before, after, and in the middle of videos.
Your ads will generate quality leads, as you can use filters and settings to target only the most relevant videos to your audience. For example, if you advertise to marketers, you will see the highest quality leads by promoting on marketing tip videos.
YouTube offers two options. You can either pay per view or pay per action.
7. Native Website Ads
Native advertising is steadily growing in popularity among marketers. Through native ads, you can create a more positive user experience by integrating your ad with the content surrounding it instead of interrupting it with a pop-up or large banner.
Native advertising on trusted sites allows you to use the publisher’s authority to build trust with your audience. In addition, you can reach a larger audience than you would through content on your website alone.
You only pay per action or view when you post a native ad on third-party websites. Your content will usually appear in a widget at the end or next to the native content of the website. It’s designated as sponsored or further reading to show visitors it’s a paid ad. You then pay for each visitor that clicks on your article, downloads your digital asset, or completes your call to action.
Wrapping It Up
Remember that growing awareness, building trust, generating leads, and sales all play a role with a successful advertising strategy. Track and measure your top performing channels, KPIs that matter to the business, and avenues you need consider to further move the needle. No execution is going to be perfect, but the more you test, the more you’ll be able to use data to make better decisions.