Performance Marketing: What Does It Mean?

Recently I’ve been having quite a few conversations with our clients about performance marketing and how it is different from some of the content marketing campaigns that we’ve been involved in.

These two areas are  not necessarily 100% distinct, in that content marketing can drive “performance” outcomes, however I like to talk about them as two distinct areas.  This is because we’re usually communicating with different audiences who are at different stages of the funnel. 

It’s worth mentioning that you probably won’t be able to run a really effective performance marketing campaign without good content.

What is Performance Marketing?

In its simplest form, performance marketing refers to producing outcomes at the bottom end of the funnel. It includes but is not limited to generating leads, sales, donations, newsletter sign-ups, subscriptions etc. It is marketing where the advertiser uses paid advertising only to create specific actions or results or “performance”

This focus on performance can  also help  with moving the user experience in the right direction. For example, a lot of users land on your apparel website but never end up buying a T-shirt. The data will indicate whether you’re getting the right people to your site and potentially help provide data to start to understand whether optimising your landing pages could drive even more results.

Why Performance Marketing?

Not only do digital channels give you massive reach and access to new audiences they also come with lots of advantages on the measurement and tracking front. 

Once an advertiser has crystal clear objectives, the robust tracking offered by digital channels allows them to measure the exact impact of their efforts. 

At its core, performance marketing is all about measurement. 

Marketers can extract detailed insights that show how the particular outcome was achieved. This information can be used throughout the campaign and help you build on what you know so your next campaign is even more effective! The key is knowing which metrics a you should be paying attention to. 

What happens once someone knows about your brand? Well, ideally, you’d like them to move towards taking action, often in the form of a purchase. Performance marketing focuses on this action. Whether something as small as a follow on Instagram or a large scale. 

Performance marketing campaigns are  focused on ensuring that you can achieve your desired outcomes with maximum efficiency, i.e. the lowest cost per conversion and the highest conversion rate. 

How is Performance Marketing different from Content Marketing?

Content and performance marketing are usually used at different and opposing ends of the customer journey. You’re much more likely to be hit by a content marketing message during the early phases of engagement with a brand. Content marketing messaging is much more likely to be about brand positioning. After all, not many people are willing to kiss on the first date (or buy the first time you see your ad, although admittedly, some might). 

Imagine you are an extremely enterprising individual who wants to start a bakery. But that’s only the beginning of the dream. You’re not here to sell cake. You want to establish yourself as an institution of baking. Your vision encompasses a chain of bakeries, world-renowned baking courses, guest appearances on MasterChef, your brand on supermarket shelves, an extensive online community of baking enthusiasts, cake photographers, and the works. 

Your focus should be on more than just the product or service. It’s the brand that’s important. That’s where content marketing strategy comes in. It allows you to build a brand and a community of loyalists amid your target audiences, it’s with these people that your brand might truly resonate and start to grow.

Content marketing usually relies on items that aim to subtly attract the customer’s attention.  You’ll most frequently come across this type of campaign on websites (think editorial articles on blogs and news sites), video platforms (reviews and other informational videos on YouTube), social media (Facebook, TikTok etc.) and increasingly via podcasts. 

One of the big benefits of investing in content marketing is that if the content produced is highly relevant to your customers then it can be an extremely effective way of building up a high organic reach.  Therefore, you won’t have to pay for each individual custom that you acquire.  However, if your content doesn’t quite strike the right note with customers or if the algorithms just don’t surface often enough then the high costs of creating the high-quality content might mean you never make a direct return on your investment. 

Content marketing can be nicely summed up as follows:

“..a marketing technique of creating and distributing valuable, relevant and consistent content to attract and acquire a clearly defined audience – with the objective of driving profitable customer action.” (“Agony Uncle: Trevor Morris.” PR Week, Haymarket Business Publications Ltd., Nov. 2014, p. 70.)

Content marketing campaigns are what most of your favourite brands run. Everyone from the biggest brands on the planet like Coke, IBM, and Apple to your local grocery store can benefit from it. Every single piece of content brings customers one step closer to the brand. It helps people become familiar with “the funnel”. That’s where your marketing begins. 

Content marketing provides a valuable opportunity to position your brand in the way you want it to be seen and understood. You can build engagement with your target audience and make sure you’re in their minds when ready to buy. To truly scale your results, it’s essential that both performance and content marketing are present in your marketing mix.

Dave Chaffey’s Content Marketing Matrix provides some solid guidance as to when you might use different types of content marketing (Source: Smart Insights):

We’d love to talk with you.

Are you still confused about Performance Marketing? Wanting to explore Performance Marketing Channels finally? Reach out to a Ninja and let us take care of it for you.

    Jon Dawson, CEO of Digital Ninjas
    Jonathan will get back to you soon