Performance marketing is a type of Internet marketing, which is considered one of the most demanded and efficient today. The term performance marketing was created to define the complexity of strategies of online marketing and mechanisms of digital advertising.
The feature which defines the main difference between performance marketing and other forms of Internet marketing is that it is aimed at the achievement of concrete, financially measurable business results as soon as possible. Results, which are required, mostly are such actions as conversions and clicks. Thus, businesses hire specialists like online marketers and advertisers to drive, measure, and trach such actions. Moreover, the process of the realization of the performance marketing strategy the ROI (Return On Investment) of every activity and project is determined.
The use of performance marketing is a great method to improve affiliate sales and enhance the online side of your business. It is considered that the main idea of performance marketing is that any investments into a promotion campaign have to bring measurable returns.
Components of Performance Marketing
It is customary to distinguish 8 main components of performance marketing:
- Cross-cutting analytics
- Determination of goals
- Building a comprehensive strategy
- Comprehensive strategy realization
- Coverage and attraction
- Conversion
- Customers return
- Performance measurement
- Cross-Cutting Analytics
This stage implies the research of certain business peculiarities and current needs, which could be covered by performance marketing. In addition, it is necessary to explore the previous strategy of online marketing and digital advertising to define effective and ineffective methods for business development.
Determination of Goals
When the analysis of the business’s strong and weak points is finished, it is possible to elaborate a step-by-step marketing plan.
Marketing goals setting is carried based on the SMART system. Also, it is necessary to take into account that performance marketing is aimed at sales improvement, not as much at brand awareness increase. Thus, goals should be set so that their implementation shows financially measurable results.
Building a Comprehensive Strategy
The realization of any type of Internet marketing implies the use of specific instruments and techniques carefully chosen beforehand. It is important to understand that some marketing tools might be perfect for one business but will bring suboptimal results in another industry or sector. So, the choice of marketing instruments depends on the definite business sphere and also on current market conditions.
In addition, a comprehensive strategy is based on the online marketing trends and web analytics of the online platform of the business (website or social media profile).
Comprehensive Strategy Realization
This phase of performance marketing includes the search for specialists who can help to provide successful promotional activities and distribution of duties. Also, consider the importance of the initial period of the strategy realization. This period demonstrates what points need to be corrected.
Coverage and Attraction
This stage is the start of working with potential clients. It implies notifying as many users as possible about an actual offer and increase of the website traffic. This component includes several methods:
- SEO
- Contextual advertising
- Lead generators
- Targeted advertising on social networks
- RTB
- Display promotion
Conversion
This process implies the transformation of site visitors into real buyers of the service or product. It is important to understand customers and communicate with them not to lose their attention and start building brand trust with your target audience.
Customers Return
It is great when a client buys your product once but it is much better when this customer returns for more. So, it is necessary to carry such methods as:
- SMM
- Content marketing
- Retargeting
- SMS-mailing
Performance Measurement
This is a finishing stage. There are several indicators, which are considered when evaluating the effectiveness of performance marketing (ROI, CRV, CLV, ROAS, and ROMI).
