In the last couple years, we started to know the term of Performance Marketing. Yes, it is an interactive advertising method where the advertiser pays according to how an ad performs. This kind of marketing actually changes the way of advertising and product selling. Unlike traditional advertising, where the usual objective is to drive awareness, the goal of performance marketing is about to drive action, so we can see the conversion of the users.
Performance marketing might be calculated based on these 4 things
1. Frequency of the ad
How many people you will reach is depend on your budget. Put it in the right channels to maximize the ad.
2. The number of the click
In performance marketing, you can buy guarantee clicks. You don’t have to be afraid you will get fewer clicks. The clicks are actually based on your budget as well.
3. Lead generating
The conversion of click to sales will be well-counted in Performance Marketing. This is important because once you have their data, you can approach them personally to gain more sales.
4. Combination of three things above
Performance marketing also can be calculated from the reach, click and leads you will get. So it depends on your purpose of marketing.
In this performance marketing, the user action is the key factor. User action is the billing! So the most crucial part is to track and measure the ad’s performance; collating and analysis of the results will then provide the advertiser insights on what to do next, in the areas of ad optimization as well as leveraging on existing opportunities.
Talking about this kind of marketing, Performance Marketing offers transparent side of advertising. Different from traditional forms of advertising, the advertiser will spend millions of rupiah without ever seeing a conversion or even optimizing it.
In digital marketing, measurable ROI is key to the successful campaign. We know exactly how many leads we got, clicks and reach. One kind of Native Advertising is Performance Marketing. Well, Native Advertising actually gives you how many clicks you will get, so you can measure how effective your budget is. For example, you buy 10,000 clicks with a certain amount of money, then you will get 10,000 clicks in the end of your campaign. It also can track how many conversions happen so the client knows where the budget goes.
Performance marketing needs more and more optimization, to perform the result better. We should monitor our ad performance, which sources of traffic are performing best. In the end, this marketing strategy is to get the better return on investment.