Rational management of costs and measurement of one’s actions: performance marketing as pure targeting and “reasoned gambling.” Defining it uniquely is not easy, because it is a series of strategies, best practices and activities that are constantly being updated and refined: performance marketing is an approach based, as the name implies, on results (or performance).
The major difference from classic marketing, or other types of approaches, lies in the location of the budget: in classic strategies, in fact, against an initial, allocated and reasoned expenditure, specific actions are taken that are part of the budget, for which specific returns are planned in line with said budget.
In performance marketing, the plan of action works in the opposite way; campaigns (digital, but not only) are launched, and their results are measured. Based on these, campaigns, designed on the target audience, are constantly optimized, monitored again and implemented. Fundamental then becomes content marketing: measurements and performance depend on the proposed content, which is the most powerful means to achieve one’s goals.
The Data: the most valuable resource of this century.
Any digital information from collection tools (among many, Google Analytics) is data; it can be quantitative, activity reports, audience biographics, or simple performance metrics – the ones we are talking about now. What we need to understand, as a first move, is what data we need for the purposes of optimizing our business.
In the ongoing process of optimizing one’s performance, there are metrics we cannot ignore. Among the most important we have:
Based on the performance of the campaigns, different payment methods can then be evaluated, again based on the performance itself:
With a view to the future of digital marketing and content marketing, working following a performance-based strategy is definitely among the most profitable directions for a company.
Beyond the lack of large preventive budgets on campaigns, and thus rationalized and results-based spending, there are several interesting benefits to consider.
Since this is an ROI-focused approach, every single action has its own positive impact (hopefully) on the bottom line of one’s business, with a significantly lower rate of risk than classical methodologies. Generating then masses of data (big or small) is an additional value for the company, which will be able to profile itself even better as a data-driven reality, with all the relevant advantages. Campaigns, in this way, will be easier to track, and any intervention and optimization will not be lost in a stream of inconclusive assumptions and tests.