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What is Performance Marketing?

Performance Marketing is all about measurable user reactions and the tools to achieve them. In this marketing approach, which belongs to the large field of online marketing, performance or results are measured and then optimised.
  • Is aimed at measurable performance
  • Serves to win new customers and retain them
  • Should online advertising be even more effective
  • Focus on the target groups offer and response

Goals and channels of performance marketing

Performance marketing can be operated via different channels, including affiliate marketing, banner advertising, email marketing, social media marketing, but also SEO and SEA. In Performance Marketing the results achieved are measured and constantly optimized – two essential aspects for the success of a campaign. Clicks on advertising banners (display media), registrations on pages (leads) or purchases of products and services can be the targeted actions. User reactions or transactions should be achieved and made measurable for the company. Performance marketing thus achieves both interaction with customers and a high level of cost transparency, especially through measurability. It plays a particularly important role in the field of e-commerce. Depending on the industry, performance marketing is also weighted differently in the marketing mix. Performance marketing (performance) is part of online marketing, uses digital media and takes place almost exclusively online. The focus here is on the companys offerings and the respective reactions of the appropriate target groups to them. Performance marketing is used equally for the acquisition of new customers and for customer retention. The marketing objectives are conversions, whereby the specific details are agreed in advance by the advertiser and marketer. In order to achieve relevant results, the corresponding measures in performance marketing must be individually tailored to the respective customer segment. The means by which these target groups are addressed should be networked with each other as far as possible. Existing data is always linked to newly acquired data (Data & Analytics).

Measurement and Optimization in Performance Marketing

The common indicators are the traffic and click data and the conversion data. The latter include the conversion rate and the conversion costs. The indicators click-through rate and cost per click can be summarized with the generic term click data. All these indicators are collected so that they can help the company to constantly monitor performance and, if necessary, to further optimise it. Data & Analytics help with the alignment of goals, the determination of campaign results and target groups, so that a holistic view can also be created. It is always important to define measurable goals first. This is followed by the selection of suitable channels and the budget distribution in the marketing mix. Individual target KPIs are then derived, tracking implemented and web analysis tools used. Permanent testing and optimization of the campaigns, supported by ongoing monitoring and controlling, are indispensable. Banners can then, for example, be exchanged in favour of a higher CTR. The content of a page can also be optimized by A/B tests for better conversions. In general, user interactions with heat maps and web analysis tools can be analyzed and evaluated very precisely, especially in e-commerce. Performance marketing thus uses all available options for analyzing buyer behavior with the aim of making online advertising more powerful. For advertising customers, performance marketing has numerous advantages, so that win-win situations usually arise. The success of advertising campaigns can be precisely evaluated and directly measured. Billing is possible on a performance basis, so customers only pay for targets that have actually been achieved. In addition, both budgeting and planning are greatly simplified. Performance marketing can therefore usually be perfectly integrated into a campaign. In order for it to have its full effect, however, advertisers must set their targets as realistically as possible. This includes knowledge of the respective target group in order to avoid wastage and optimize targeting

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