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What Is Performance Marketing And How Brands Are Using It

Various marketing strategies and tactics are used to grow blogs or brands. The strategies help the brands and blogs to reach a bigger audience, which helps them improve their sales revenue. All this helps the brand to achieve brand positioning in the eyes of its potential customers.

Of the many modern marketing methods, the one way that has shown tremendous growth potential is “Performance Marketing.”

Performance marketing focuses on cost per action.

We will be discussing exactly what is Performance marketing and how it is affecting the digital marketing world. You will then be able to use these strategies and use them in the real world to improve lead conversions.

So let’s begin.

What Is Performance Marketing?

Marketing rules are set in advance in performance marketing. These rules then dictate the overall success of a campaign.

The publisher pays according to the number of specific actions that have taken place. The action could be a sale, click, or a lead.

What Makes Performance Marketing Unique?

The most traditional forms of advertising, the advertiser pays a fee upfront. Which means the advertiser has no knowledge of what returns the campaign could make. Isn’t this a significant risk?

With performance marketing, advertisers only pay for successful transactions. This way, the advertiser has complete control over the budget, and the campaign growth can be measured systematically.

Types Of Conversions In Performance Marketing

We briefly touched the types of conversions in the previous paragraph. We will go through the most popular conversion methods in Performance Marketing.

Per Per Lead

The advertiser pays the commission for every lead the referrer brings. For example, Grammarly pays the referrer $0.20 per free sign-ups. The company gets a user for a specified amount.

Pay Per Sale

Every time a referrer makes a sale, the company pays him. This transaction can also be considered as Cost Per Acquisition.

Pay Per Click

Pay Per Click is a standard business model for many companies. The advertiser pays for every click that the publisher gets. Adsense is a famous example of this type of advertising.

Pay Per Install

Every time software or an app is installed through a publisher, and the advertiser pays him. There are many terms attached to this type of advertising. Only installing the app can sometimes not be eligible for a payout. The user might also have to perform tasks in the app for the publisher to get its pay. So it's essential the publisher reads the terms set by the advertising correctly.

There are many ways of tracking conversion in performance marketing that we have left out. The most popular ones are listed here. Other types of conversions include Pay Per Call and many others.

The conversion methods help increase the userbase and indirectly increases the sales of the advertising company.

Top Performance Marketing Channels

Performance marketing is a very profitable advertising model. However, the success of performance marketing depends on the marketing channel.

It has a significant role in increasing the ROI you get through performance marketing.

Here are some of the major channels that will help you run performance marketing campaigns:

Push Notifications

Push notifications have become a vital marketing strategy in 2019. It enables you to reach out to the audience via notifications on the desktop and their mobile app. It can be used to generate traffic to a new post or product or to generate leads and sales.

Native Advertising

Native advertising fits in with the UI of the website and does nothing to stand out. The perfect example would be Quora. If you have used Quora, between the answers, a sponsored post is placed in the form of question and answer. It blends in with the website and doesn’t stand out. It flows along with the content and the website design perfectly.

Pop Up Ads

The most attention-grabbing form of advertising. Since performance marketing depends mostly on the action the user takes, it becomes a vital part of marketing. Popups can encourage the user to take action. As a result, both the publisher and advertiser benefit from this marketing channel.

Social Media

In this modern age, social media is a vital component of marketing. It uses social media platforms to find and engage the relevant audience through content. Advertisers can target audiences with specific interests, and hence, performance marketing can have very high returns.

Content Marketing

Content marketing helps increase the organic reach for an advertiser. Since it increases the chances of users converting into leads. Besides this content can also be used for paid ads to boost its audience reach.

Affiliate Marketing

A subset of performance-based marketing is affiliate marketing where the set action is to pay the publisher with every lead that they bring.

However, affiliate marketing and performance marketing have their differences.

  1. In affiliate marketing, it takes time to verify a sale, unlike performance marketing, where the conversions are almost instantaneous.
  2. Earning opportunities are limited in affiliate marketing since it depends on the number of sales completed. However, on the other hand, performance marketing has many options, such as pay per download, pay per click, pay per call, and so on so forth.
  3. Affiliate marketing has commissioned in the range of 30%-50% (may vary). However, in performance marketing, the rates are much lower. The payouts can vary between $0.50 to $2.
  4. Affiliate marketing can work with a small audience to gain high returns. However, to earn more in Performance marketing, the traffic requirements are very high.

Benefits Of Performance Marketing

Performance marketing many benefits as a digital marketing strategy. Besides the obvious benefit of building your user base through the third party with their audiences, budgets and reach capacity.

All this helps you increase your market share, targeted traffic and audience engagement.

Further, performance marketing is trackable and transparent. This approach helps brands study customer patterns and identify where to invest more and in which channel and partners to produce better results.

Performance Marketing is paid for after the desired action takes place; the risks involved are lower than other traditional advertising strategies, CPA (Cost Per Acquisition) is often smaller than other digital marketing campaigns. The ROI (Rate Of Interest) as a result, also higher.

All this helps saving budget, which can then be used for other vital strategies to experiment and grow.

Tips To Be Successful At Performance Marketing

A few general tips to become better at performance marketing:

#1 Focus On A Good Landing Page And Offer

Performance marketing is all about converting the visiting user. So it is essential to give them enough reasons to take action.

One way of doing it is via an attractive landing page that promotes reasonable offers. But it has to have both qualities. A good looking landing page won’t convert if it doesn’t have a good offer. And vice versa, a good offer being promoted on a bad landing page won’t create a significant impact on the user.

#2 A/B Test Your Campaigns

Testing your various campaigns is vital in performance marketing. Try different techniques and strategies to increase conversions.

Use A/B testing to promote the same content in different styles and different channels. Measure the results and find out which campaign best works for you.

#3 Chose Your Traffic Sources Carefully

The importance of brand image cannot be stressed enough. So, make sure you carefully chose your traffic source with performance marketing.

When you are being referred with less reputable sources, consumers will think twice before engaging with you.

Make sure your publisher approval terms are appropriate and reasonably strict for your brand.

#4 Track And Monitor The Results

With performance marketing, you can track and measure various metrics like bounce rates, session time etc. These metrics give you insights on what's working or what needs improvement in your performance marketing strategies.

Without data analysis of your performance marketing campaigns, the results of the advertising campaign will not grow.

#5 Be Compliant

Performance marketing is about strategic partnerships between advertisers, publishers and the audience.

To do this successfully, all involved parties need to follow the rules. The FTC (Federal Trade Commission) has policies and terms that ensure that the trade between the parties is conducted in a fair and just manner.

5 Best Performance Marketing Networks

Performance marketing has become a trend, and many agencies are starting their networks to help connect advertisers and publishers.

Here is the list of top 5 Best Performance Marketing Networks:

  1. MaxBounty
  2. Peerfly
  3. Clickbooth
  4. GlobalWide Media
  5. Panthera Network


Performance marketing is a way to build brands by increasing product awareness and to engage with the customers without disturbing budget limitations.

Engaging in performance marketing strategies gives brands/ merchants and retailers access to an audience that would have been difficult to reach with traditional marketing approaches.

Performance marketing has become a trend in today’s digital age. Data shows continued investment into channels from new players entering the space to optimize results and multiply sales in a short duration.

If you have just got started with performance marketing, make sure you are analyzing each metric carefully to study what's working for you. You can then set budgets accordingly and improve the campaign metrics.

Have a clear goal with your performance marketing strategy, build relationships and start converting those users into powerful leads!