Performance marketing lets marketers decide on the desired action, and only pay digital advertising platforms after that action has been completed. These actions can be a click, subscription, sale or download.
Knowing where your resources are being used is critical when you have restricted budgets. One of the biggest advantages of performance marketing is the ability to easily measure your ROI. By analyzing the campaign data, you can easily monitor if your ad is working effectively and evaluate your regular ad budgets accordingly. It additionally eliminates opportunity cost, by letting you estimate the price of a campaign before you implement it. This helps in minimising risk – and the fewer ineffective campaigns you start and then abandon, the less cost is entailed.
Here are some tips about how to use it effectively.
- Target wisely; to ensure precise targeting, you need to understand who will take the actions you desired. All these behavioural statistics are then fed back to further train each step, so the system is constantly learning and improving to ensure all the models can be directed to find potential customers who will generate the maximum ROI.
- Leverage user interests; knowing your audience’s broader interests will help you create more engaging and direct marketing content. This is especially crucial in e-commerce, where the ability to cross-sell across additional product categories will bring new customers to your website with the intent of purchasing in your high-margin vertical.
- Retarget; analysing customer data and specifics can shed light on those who visited your site without making a purchase, this allows you to retarget them with customised ads on other sites on the internet. For instance, if Karan looks at a shirt but does not buy it, you can serve him with adverts for the same shirt once he has left your website.
- Timing is crucial; in advertising – as in comedy – timing is everything. By knowing at what time of the day your ads get the maximum click-through rates, you can buy those times with bid multipliers, increasing the possibility of converting leads into paying customers. Performance marketing can assist you to monitor your ad budgets/spending more closely, and reassign it accordingly. If used effectively, with the right know-how and tools to unlock the statistics, it can provide your business with some stability during these challenging times.
Marketers looking to notch-up advertising efforts and boost results should be amplified by performance marketing and all it has to offer. Unlike traditional methods, performance marketing allows advertisers to plan better and productively, pay only for results, track performance, understand and react to feedback, and find new ad placement opportunities. With all of these added benefits, it’s no surprise that performance marketing is becoming the new glorified standard for advertising.