Hello Readers! Let’s understand the concept of “Performance Marketing” in this article in a simplified manner.
Think about how you used to get marks in your school time. The better you write in your exam sheets, the better you scored. The grades are based on your “performance”. From junior school to college to the corporate, people have been judged and have reaped the benefit according to their efforts. In the era of digitization, the concept of “performance based marketing” follows the same pattern.
The world is interconnected and though red market exist for most of the businesses as well as industries, it has become crucial to keep aside the competitiveness and mutually benefit each other. For instance, a website is no more about just themselves but contains various videos, links, advertisements and images for other businesses as well. One way to increase the traffic is about creating back-links and posting the content of another page/site to own page.
Now, here comes the concept of “Performance Marketing” which can be defined as the comprehensive term that refers to online marketing and advertising programs in which advertisers (a.k.a., “retailers” or “merchants”) pay marketing companies (a.k.a, “affiliates” or “publishers”) when a specific action is completed; such as a sale, lead or click. (https://thepma.org/)
The business environment is a very dynamic one and to keep up with the pace, performance marketing helps retailers and affiliates to sustain and grow. It creates a win-win situation for both parties involved: retailers as well as affiliates. You might have come across a page with too many advertisements running along the page. And I am sure you know why it is important for websites to do so.
The performance in this case can be an array of executed desired results, such a completed lead, sale, booking or download. Some believe in “clicks” as the more number of prospects click on the advertisement, the more the affiliate are benefited. There are multiple strategies one follows while designing the affiliate program according to the business. In this data driven marketing world, performance marketing campaigns give one the ability to measure everything from brand reach to conversion rate down to a single ad.
Benefits of running this campaign:
- Easy to track performance
- Increase brand visibility
- Low Risk
- Some marketing tools need investments to run and analyse about any campaign
- Goals setting must be very specific from the beginning
- Catering to the masses
Performance marketing has evolved over time thanks to new technology and changing consumer behaviors. In today’s performance-driven world, digital marketing is all about “hitting the right people on the right device at the right time.” (utbrain) With performance marketing, only the successful transactions are considered and paid accordingly which reduces the chances of investing and paying for useless campaigns that have no or minimum ROI.
With a great vision, good team and marketing tools, a company can go ahead with launching various performance marketing campaigns and increase their web presence by collaborating with others in the market.