Performance marketing forces all advertising channels to work together to maximize marketing effectiveness. The main principles and goals of this approach are the return of marketing investments and sales growth. This method focuses on real business goals, which are developed step by step during interactions with consumers:
- a need arises;
- proposed solution;
- audience retention;
- leads turn into sales;
- loyalty increases.
What is Performance Marketing and how does it work?
Performance marketing is a promotion strategy aimed at achieving measurable financial results (KPI) in a short time. This direction should be mastered by anyone who wastes half of their budget and does not know where exactly. There are no abstract indicators in performance marketing - it is especially useful in times of loss of profits and crisis. Performance Marketing, in addition to being sales-oriented, is distinguished by the fact that it works when demand has already been created among the recipients.
COMPREHENSIVE (i.e. using all digital marketing tools) Performance marketing requires a large budget. Its use is justified for companies whose marketing budget is PLN 20,000 thousand per month or more. But even if your budget is much smaller, you can put the basic principles of Performance Marketing into practice. Track how much money each advertising channel needs. If the effectiveness of one tool is decreasing, spread the money to more effective areas.
Features of performance marketing:
- measurability of the effectiveness of the channels used;
- assessment of business indicators (CPA, ROI);
- ability to influence performance in real time;
- synchronize SEO, SMM, email marketing, media advertising to achieve maximum results.
Campaign performance is measured and tracked using referral links, coupon codes and individual phone numbers. This method requires extensive setup and thorough testing. Additionally, you need an effective strategy and a convenient, fast platform. But in the end, all the efforts paid off with high ROI and ease of determining the success of the campaign.
How to work with Performance Marketing?
To understand how performance marketing works, let's look at its main elements: deep data analysis. At the beginning, it is important to analyze the business indicators of the company, competitors, market and consider the advantages and disadvantages of products. It is necessary to study the target audience, TOP search results by topic, semantic core and the effectiveness of all traffic sources. In-depth analytics should be present at every stage of work - this allows you to control the effectiveness of the invested money.
Setting goals.
Defining the goal is the starting point for developing a campaign. The further strategy, implementation deadlines, budget and advertising tools depend on it. The goal must be specific, measurable and time-bound.
Building a comprehensive strategy.
At this stage, the most effective advertising tools and channels are selected for a specific case. Thanks to regular audits, effective techniques are corrected and unprofitable tools are replaced with new ones that provide the expected results in advance.
Management of advertising channels.
It is necessary not only to count requests, but also to check how requests are related to advertising channels and how high their quality is. Comprehensive analytics will help determine how much budget was spent on channel development and what revenues the company received. Thanks to this efficiency analysis, it is possible to trace the consumer path through the sales funnel, determine the average bill for each channel and profitability for the reporting period.
The main tools of performance marketing:
- Contextual advertising
- SMM (targeted advertising)
- Marketplace
- Email marketing
- Native advertising
- Mobile marketing
- Remarketing
- Affiliate programs
In performance marketing, all of these tools work together to achieve key business goals.
An example of performance marketing.
Let's assume your company creates websites. You want to increase sales by driving more targeted traffic to your website.
Stage 1. Depending on the specific nature of the business, media tools and websites visited by potential customers are selected and agreed upon.
Stage 2. Attracted by contextual and targeted advertising on social networks, visitors return to the site through regular advertising channels and the number of applications increases. Previously attracted audiences also return for branded SEO queries. In addition to the app, visitors actively subscribe to email newsletters on their first visit. Email marketing increases visitor loyalty and sales volume.
Stage 3. Promotions are displayed to inactive users and dynamic retargeting is launched.
Stage 4. Focus on repeat sales. Once attracted, users can become repeat customers; they can be motivated to repeat orders using push notifications, targeting on social networks and launched email campaigns. You combine all advertising tools into one system and build interaction with users to improve conversions.
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