5 advantages of performance marketing

Why is performance marketing so interesting ?

 

Advertising is an essential part of a product’s or service’s marketing. It is quite common for some companies to invest as much into launching their product as they spent on developing it, especially at the beginning of its life cycle. This investment can represent a heavy burden, and success is not necessarily guaranteed. With that in mind, here are 5 reasons why partnering with a performance marketing agency can work to your advantage.

 

1. Lessens some of the uncertainty in comparison with traditional marketing

 

In a traditional marketing setting, a company will usually spend most of the marketing budget prior to launching its product or service to create the advertising strategy and campaign. This significant investment is a leap of faith of sorts: it is impossible to know if all these efforts and resources will be successful.

 

For many companies, it would be much more convenient to pay their marketing agency only if the advertising campaign actually reaches its initial goals in terms of lead generation and client acquisition. The concept may seem rather odd, but it is what performance marketing agencies like Cosa digital agency do for a living!

2. The Web is its playground

 

The early 2000s saw the arrival of Web 2.0, with its massive user-generated content creation and greater interactivity between users. Social media such as Facebook, Twitter, or Reddit, and content publication platforms like Youtube or WordPress were created during that decade. Today, they get most of their revenue directly or indirectly from advertising.

 

It’s also in 2005 that Google Analytics was launched, one of the most popular web audience monitoring tools and an essential element for digital marketers. This platform made web traffic measurable using convenient and accessible tools.

 

Performance marketing is thus an especially well-adapted business model for online marketing, which has all the ingredients for success:

 

    Companies (advertisers) with a product or a service to sell to a target audience

    Content creators or distributors with a compatible audience (web traffic source)

    Digital tools allowing for a precise assessment of an advertising campaign performance through time

 

A performance marketing agency delivers the expertise and tools needed to connect advertisers and traffic sources.

 

 

3. The strength of adaptability

 

Ever since the first advertising banner appeared on the web in the 1990s, digital marketing has mostly been conducted as an online version of traditional marketing. Campaigns are prepared upstream by an agency that gets paid no matter the results…which were quite tough to assess without reliable data.

 

A performance marketing agency has to reach specific goals to get paid:

 

• an impression: an advertisement is displayed to a user, making them aware of the company’s or product’s existence

•  a click: a user clicks on an advertisement and visits a landing page giving information on a product or service

•  a lead: a user subscribes to the company’s newsletter or fills out a quote request, thus sharing his personal information and identifying themselves as a potential customer

•  a conversion: a user performs a specific action such as buying a product or subscribing to a service. The company gains a real client.

 

It is very much in the agency’s best interest to monitor its campaigns’ performance to fine-tune the message, the visuals, or the call-to-action to entice users to interact with the advertisement. This monitoring and adaptability are made possible by all the data and analytics gathered almost in real time and analyzed by a specialized team.

 

The end goal is to ensure that the advertisement is seen at the right moment, in the right place, by the right people.

 

 

4. Transparent and reliable indicators

 

The remuneration mode of performance marketing involves some trust between the three main players: the advertisers, the traffic source, and the agency. The latter has to supply information regarding campaign performance to justify the amount they charge the advertiser and the commission they pay the affiliated traffic sources.

 

Depending on the objectives that are set for a campaign, several metrics may be relevant, such as:

 

click-trough rate: the proportion of people who have seen the advertisement and clicked on it

conversion rate: the proportion of people who have seen the advertisement and who have completed a set action, usually a sale or an app installation

cost-per-click (CPC): represents the number of clicks in comparison to the advertisement’s budget

cost-per-lead (CPL): represents the number of leads generated in comparison to the advertisement’s budget

cost-per-action/acquisition (CPA): represents the number of clients acquired in comparison to the advertisement’s budget

 

For a successful campaign, we’ll seek to reach high click-through and conversion rates with rather low CPC, CPL, and CPA.

 

5. A one-stop-shop solution

 

A performance marketing agency, such as Crakmedia, offers a comprehensive solution, including web development, SEO, and media buy or design, and handles all of their clients’ marketing needs. It’s very interesting for many companies, especially SMEs, which can’t necessarily afford a full-time in-house marketing staff. Partnering with a performance marketing agency allows access to real specialists in the field who do that all day long: creating high-visibility web campaigns to maximize their partners’ revenue.

 

There are several methods for conducting performance marketing. At Crakmedia, our specialty is the affiliate network. It’s a type of digital marketing that allows content creators or distributors to choose offers from suppliers (advertisers), promote them to their audience, and receive a commission as per a predetermined method:

 

• pay per sale: the affiliate receives a fixed amount for every sale made through their custom link

• pay per lead: the affiliate receives a fixed amount for each potential customer who, for instance gives their email address or subscribe to a newsletter

• pay per click: the affiliate receives a fixed amount for each person clicking on an advertisement or follows a sponsored link

• revenue share: the affiliate receives a percentage of all sales made through their custom link

 

The agency’s creative team produces a myriad of visual resources for affiliates to promote the advertisers’ products according to the kind of content they create:

 

• advertising banners

• pre-rolls

• scripts for influencers

• landing pages

• cutting edge promotional tools

 

The goal is always to create the most successful experience possible for both affiliates and advertisers.