Performance marketing is a result-driven marketing strategy where the brands pay only when their objectives have been met. Performance marketing services offer brands to not pay for a campaign or Ads traditionally but based on how well the ads perform by measuring the number of clicks, impressions, and shares. Performance marketing is principally a real-time evaluation of the brand’s performance which helps the Performance marketing consultants optimize the website to generate ROIs, leads, and traffic on your page.
How do you measure performance-based digital marketing?
One of the key factors in evaluating how well your website is performing is through measuring KPIs. KPIs further use certain metrics to determine the outcome, such as Cost per click, cost per acquisition (CPA), and return on ad spend (ROAS). The agencies will use these metrics to optimize the strategies.
Let us now understand how performance-based digital marketing generates revenue, sales, and most importantly the ideal audience.
1. Cost per Click: The brands will only pay if their ads get clicked. This is an effective way to increase the traffic on your page. Based on the Analytics the ads budget can be adjusted accordingly. However, there can be a minor glitch, which may exhaust your budget soon. This may happen if any of your competitors purposely click on your ads. However, brands should not refrain from using Click per rate, this is generally directly related to the Conversion/Lead generations.
2. Cost per Impression: This shows you the number of times your website has been viewed and the cost would be incurred for every thousand views. To cite an example; A company’s website has been viewed 15000 times so the cost incurred would be the base rate x 15. So this is fair, isn’t it?
3. Cost per sale: with this the advertisers pay only when your Ads generate the leads and that result in success(sale).
4. Cost per Leads: Cost per Sale and Cost per Lead is more or less the same, where CPS leads the audiences to buy the products (sales). Cost per Lead inspires the audience to subscribe to newsletters, E-mail which results in further sales.
5. Cost per Acquisition: It may not be false to say that cost of Acquisition is equivalent to CPL and CPS. Cost per Acquisition refers to the method wherein Advertisers pay when the audience completes an action such as sending Emails, buying a product, or a promotion(referral).
Top Performance marketing channels:
There are multiple channels through which the performance can be improvised and target the ideal audience.
Above all the channels, content marketing plays an important role. Thus to conclude the content is the king-
Besides knowing what actually performance marketing is and the channels it uses. Let us dive deep into how performance marketing works.
1. Goal Setting: The advertiser will set up certain performance goals to achieve desired results such as leads, and conversions.
2. Target Audiences: For any business to flourish it is important to target the potential audience. There are various factors affecting: such as demographic location, Gender, Age group
3. Advertising channels: Once the goal and the target audience have been determined, the advertisers choose the medium through which they would publish their content: Social Media, Search Engine marketing, Display ads or if the budget permits then affiliate marketing.
4. Content: As said before, the content is King. It is important to create effective content that reaches your potential customers.
5. Bid and budget: The nominal amount that the advertisers are ready to invest and are willing to spend on the campaign.
6. Launch campaign: once the budget is set. The advertiser is ready for the campaign and wins the targetted audience.
7. Analysing and tracking Performance: The advertisers can track the performance of their campaign and adjust the bidding and budget effectively. This is the advantage of performance marketing that you can analyze the performance and adjust the budget more efficiently. Based on the performance the companies can optimize their campaigns.
The most effective and realistic way to visualize the company’s digital presence is through Performance Marketing.