Performance marketing: what is it?

Performance Marketing is an online advertising strategy based on performance. It is becoming more and more popular in the world of digital marketing from year to year. Performance marketing relies solely on the performance and results of digital ads — the ones you see on websites, social media, or in the middle of YouTube videos.

Performance marketing includes many measurable activities and tools, which we will discuss in this article. Advertisers and marketers can evaluate the success of their work and make informed decisions based on the results of campaigns. They can see what works for them and what doesn't, what impact it has had on their overall sales (online and offline), and optimize it.

For example, if a campaign is running that displays something the target audience doesn't like, the marketer will be able to adjust that ad asset. If he's paying attention to organics, he'll want to see how his keywords rank and make adjustments to them based on their overall performance. Marketers track how their paid and organic activities influence each other. This is referred to in the industry as the "K-factor".

It is important to emphasize that in performance marketing, people make data-driven decisions and optimize their campaigns based on the results. The end goal may vary depending on what the marketer is trying to do, but usually it is to reduce CPI, increase CVR, and improve ROI.

Before I dive further into performance marketing, I suggest understanding the word performance in order to better understand and use it correctly. Performance is the work that turns a task into an effective and measurable action. Performance is always about efficiency, benefits and results when it comes to business. For example, a set of completed desired outcomes is a completed deal, sale, booking, or download.

What tools are used in performance marketing

1. Paid user acquisition: SEM (search engine marketing - search engine marketing), targeted advertising in social networks, programmatic advertising.
2. native advertising.
3. App store optimization.
4. Search engine (SEO-) optimization.
5. Creatives.
6. ASO optimization (App Store Optimization).
7. Creatives.
8. Affiliate Marketing.

Examples of channels that are used for paid user acquisition:

1. Google Ads (Google Search Network & Google Display Network).
2. Facebook Placements (Instagram, Messenger, & Facebook Audience Network).
3. TikTok.
4. VK.
5. MyTarget.
6. LinkedIn.
7. Twitter.

Each of these platforms has different users and segmentation, so be sure to research your target audience before choosing a placement and setting up marketing campaigns. Consider the features of the sites when creating campaigns.

Now let's analyze the work in the channels in terms of performance. You want your target audience to perform certain planned actions. What you should pay close attention to:

1. CPM is the amount per thousand ad impressions.
2. CPC - Cost Per Click: An advertiser only pays when someone clicks on their ad.
3. CPL - The advertiser only pays when the target user completes and submits the lead form.
4. CPA – The advertiser only pays when a sale occurs or a lead form is completed and submitted.
5. CPI - the advertiser pays only when the user installs the application by clicking on the ad.
6. CTR is the ratio of users who click on an ad to the total number of views.
7. Return on Ad Spend (ROAS) - Measures a campaign's ability to deliver the desired result, allowing companies to determine which method is working and what can be improved where.

Keep these performance metrics in mind and try to accurately target your target audience to get optimal results for you. Analyze your keywords carefully – this really matters as users turn to search engines to find specific products and services. What could be better than meeting their needs and saving time by showing exactly what they are looking for right away? With social networks, the same story - study the audience, show advertising messages appropriately and on time, based on the interests of the target audience.

Always keep your promotional messages up to date. An ad that worked a year, a month, or even a week ago may not work today.

Update or disable it if you do not see the planned results. Measuring the success of your advertising campaigns is a necessary part of performance marketing.

Search visibility

As with most effective marketing strategies, it all starts with thorough keyword research. Find out your current positions on them and look for other relevant keywords. It's also helpful to know how your competitors are performing for those keywords.

Remember that keywords aren't everything, and design plays a key role in engaging users. A clear and concise marketing message in collaboration with the design can draw users to the page and convince them that your application is exactly what they were looking for.

In addition to design, creating an informative, engaging promo video that showcases the benefits and features of your app can be a very powerful conversion tool.

And one more important point. If you plan to enter new markets where people speak a different language, remember that it is very important to consult with native speakers before launching advertising campaigns. Because lost in translation can happen, and as a result, lost profits and drained budgets.

Search Engine Optimization (SEO)

SEO is one of the oldest "tricks" on the internet. This is a necessary step to ensure that your site appears on the first page of search results, does not get lost on the distant page number two, or worse, beyond it. In fact, only 0.78% of users will go to the second page of search results.

Every business wants to rank #1 for their main keywords, which are usually based on relevance, competitiveness, and search volume.

The rating is influenced by many factors. Stay tuned for the latest changes, updates, and requirements from Google, Mail.ru Group, and Yandex.

Creatives

Not in the last place (and most often in the first place) are creatives. This is a key factor in the success and effectiveness of an advertising campaign, because a creative has a matter of seconds to attract the target user before it is scrolled further unnoticed. Your key message should be clear and concise, but at the same time catchy, such that it will respond to the user in the soul, because it is at this moment that he decides whether you will give him what he dreams of, what he is looking for, what he craves, wants .

Creative success is constant A/B testing, with different elements, for different segments of your target audience. Remember: what seems attractive to you may not be pleasant to the user, which means it will not lead to the desired result.

Therefore, do not neglect A/B tests and do not save time on them. Also be sure to keep an eye on competitors and analyze their creatives. The online services Advancets, Publer, AdMobiSpy, AdSpoiler, PostMonitor, SpyOver will help you with this.

How to measure the efforts applied with the help of performance marketing?

There are four main points to remember here:

1. Set KPIs ahead of time - knowing what to look for and what to pay attention to is very important for positive results.
2. Knowing and continuing to research your keywords will help your target users find you and increase your chances of reaching your goals.
3. Continuously monitor and analyze intermediate and final results - you need to know what is happening and in which direction you are moving in order to correct it in time.
4. Use end-to-end analytics services - Owox, Reportdash, Roistat or Google Data Studio.

Properly built paid traffic can also influence your organic activities. If during the search process a user stumbles upon an ad, say, for home delivery of groceries, but does not click on it, then the next time he sees a promo for the same brand, he is more likely to be ready to take the targeted action you planned.

On the other hand, when it comes to organic actions, your paid advertising campaigns can be affected. By targeting high-quality keywords and adjusting your ads in a timely manner, you will help convert the moment a user lands on your website, landing page, or app. This will increase the CVR and may make the CPA lower, leading to more effective UA (user acquisition) campaigns overall.

Summarize. The key to successful performance marketing lies in pre-set goals, continuous analysis and an integrated approach.