What is Performance Marketing?

What is performance marketing?

In other words, the marketing company of your choice develops a customized marketing campaign for your business. The company then implements the program, and only when you start receiving more traffic to your website and more business, in general, will it be necessary for you to pay them for their services.

A performance marketing strategy can be implemented in a number of ways, and the specific way that is chosen for you will depend on several different factors. Digital ads are an important aspect of marketing in general, as well as in performance marketing.

Whenever prospective customers view and click on ads, it increases your chances of success, which, of course, is what you want.

Types of performance marketing channels

Performance marketing is a general term to describe an umbrella of different marketing channels. Marketing channels are tools that allow you to connect with your target audience, and marketing companies often use a combination of these different channels, depending on the business they're promoting.

Here is an overview of channels you can use in a performance marketing campaign as well as how each one works.

Social media

Experienced expert marketers like Mailchimp use social media to reach the target audiences of the companies that opt to partner with them. By focusing on these particular channels, marketing campaigns can be significantly more successful, as it's typically easier to connect with target audiences via social media platforms.

Social media channels are often used in conjunction with a sound email marketing strategy, but it will depend on your marketing company.

Display ads

Display ads appear everywhere: social media, third-party websites, apps, etc. These ads are often very creative and use a combination of videos, images, and copy as a means of catching the attention of prospective customers.

Display ads are one of the best ways to get your brand known, which is a step in the right direction when it comes to success.

Content marketing

Content marketing channels are platforms where you can opt to publish content. Some popular content marketing channels are YouTube, podcasts, Instagram, Tik Tok, Facebook, and personal websites.

The content that you will publish will be carefully constructed to entice your target audience to choose your company to do business with.

Native advertising

Native advertising channels work because these paid ads are specially created to mimic the look and feel of the site on which they appear.

Native ads purposefully don't appear to be actual ads, and they are incorporated into a site so well, that they seem as if they belong on that particular site because they're part of the site.

Search engine marketing

Search engine marketing often entails the use of search engine optimization or SEO marketing. This marketing channel enables businesses to use search engines to rank themselves as high as possible on the search results page for different terms. For instance, by ranking high in search engines, when prospective customers type in an internet search for the products or services that you provide, your company's website should display within the first 3 results.

Most people conducting internet searches will click on one of the first 3 websites that show up after performing an internet search. The more customers click on your website and check it out, the more business you're likely to receive as a result.

It is your marketing company's job to ensure that your business ranks at the top if this marketing channel is included in your plan.

Affiliate marketing/sponsored content

Affiliate marketing and sponsored content are channel terms that are often used interchangeably. They're both so similar that it's okay to use them in such a manner.

"Sponsored" content means that there is an agreement that a monetary exchange will occur between a company and a content creator. Just like Bojangles is a sponsor of Nascar, any company can be sponsored. If your company is sponsored by a well-known company, then it's likely that your business will quickly grow exponentially.

Performance marketing KPIs to watch

KPIs, or key performance indicators, are tools that can help you determine how your marketing strategies are working. You can easily measure performance, and choosing the proper KPI can help you to gather this important information. Keeping track of the performance of your marketing campaigns is important because it enables you to discover ways to improve your campaign, what needs to be changed, and what's performing well.

There are many useful KPIs, and here is an overview of some important KPIs that you might want to check out.

Cost per click

Also referred to as pay-per-click, or ppc, this type of KPI works by paying your marketer each time a certain number of prospective customers click on links leading to your webpage.

These links could appear anywhere on the web, and depending on how your marketing plan is implemented, it could be very lucrative for you. By using this KPI, you can determine exactly how many people are clicking on your ads, as well as where those ads are that are being clicked on.

Cost per impression

Businesses use cost per impression to determine how effective a particular ad or marketing campaign has been. It's such a popular way for various companies to improve business that many platforms have created a bidding process due to high demand.

Like cost per click, cost per impression enables you to determine how many impressions are being made and exactly where these impressions originated. Cost per acquisition

This form of marketing describes when a marketing company isn't paid until a business acquisition has been made. For each acquisition, a company pays a predetermined amount of money. This KPI enables you to determine exactly how much you're paying out in acquisitions and if your ads are performing well or require tweaking.

Cost per lead

Cost per lead, like cost per acquisition, only requires a company to pay their marketer when relevant leads are provided. There is a predetermined amount that must be paid upon the receipt of the leads. Your marketer might also use what's referred to as a marketing funnel, which can provide specific data regarding what a prospective customer experiences as they encounter your ads.

Cost per sale

Each time a sale is made, a company must pay their marketer a certain amount of money that was agreed upon in advance. Cost per sale can significantly reduce the overall marketing costs for a company, which is excellent for any sized company, but especially for new small businesses that may not yet have a great deal of capital.

Why you should invest in performance marketing

Performance marketing has many benefits, which is why you should seriously consider investing in it.

The absolute biggest benefit of this form of marketing is that there is no need to pay for marketing until successful transactions have transpired. This could be especially beneficial for small businesses that are just starting out since performance marketing enables them to see some results and possibly earn some money before they need to pay.

Another benefit of performance marketing is the fact that it's easy to track and measure how well it's working. This is a major advantage, as some types of marketing are difficult to track and measure. The ability to track and measure how well a marketing plan is working is important because if things need to be changed, then it's easier to determine what to change.

Furthermore, marketing companies aren't going to work for free, so they're going to work hard to make sure their campaigns are successful for you. When the campaigns they created are successful, it's a win-win for you and your marketer, as you both get paid.

Get your business out there

So, if performance marketing sounds appealing and you think it could help you to achieve your business goals, then you need an excellent marketing company like Mailchimp. Mailchimp has been helping businesses achieve their goals for many years. Not only can Mailchimp develop and implement a performance marking plan that will quickly increase your sales, but these marketing experts can customize any marketing strategy for you. A carefully customized marketing plan developed by Mailchimp can help you to achieve, if not exceed, your goals.

Key Takeaways

• Performance marketing involves paying only when desired actions, such as clicks or sales, are achieved.
• Key channels in performance marketing include social media, display ads, content marketing, native advertising, search engine marketing, and affiliate marketing.
• Key performance indicators (KPIs) to track include cost per click, cost per impression, cost per acquisition, cost per lead, and cost per sale.
• Performance marketing benefits small businesses by providing measurable results and requiring payment only after successful transactions.