Have you ever heard of Performance Marketing ? Do you know what it means and what best practices characterize it? 

In this practical guide, we want to offer you the fundamental notions to understand the meaning and potential of this advanced marketing method and, to do so, we will start from the definitions .

We speak of Performance Marketing referring to a marketing approach or model that aims to generate engagement and responses from users through certifiable leads, likes or subscriptions that are paid exclusively on the basis of the result obtained. As you can therefore understand, the first and most important aspect of Performance Marketing is represented by its measurability – a key aspect, which is based on the increasingly marked need for analysis of marketing metrics that are typical of the most advanced approaches. 

In practice, Performance Marketing is based on performance intended as a result , and provides for an almost total reduction of the initial costs typical of more traditional marketing campaigns, such as those of the campaign implementation . At the same time, Performance Marketing must by its nature perform at its best, and therefore it is customized on the target and always modifiable even “on the run”, precisely according to the analysis and monitoring results. 

A typical example of Performance Marketing is represented, for example, by advanced  Content Marketing .

The key metrics of Performance Marketing 

What are the key metrics that define Performance Marketing results and performance ?

As mentioned, it is precisely in the analysis, monitoring and measurement of performance that the fulcrum of this approach lies, and for this reason they always represent the focal point of every Performance Marketing project. Therefore, in this case, we are dealing with so-called “ data-driven ” marketing projects , in which data and contents can change while keeping the initial strategy unchanged . 

So let’s see these fundamental  metrics together.

  • Click and / or open rate : in Performance Marketing, this is an essential value for defining the results of a specific CTA within a campaign. Tracking user actions will offer marketers a valuable insight into the effectiveness of the campaign and a series of data of absolute interest regarding the origin of the clicks. Depending on the latter, the project or its channels can be recalibrated to become even more precise and performing. At the same time, the click-through rate will also be used to determine the costs of pay per click campaigns.
  • Conversion rate : Also known as the conversion rate, this factor allows you to measure and define conversion rates for specific actions. Classic examples may include subscribing to the newsletter, the action of downloading premium content or providing personal data for the receipt of specific material, for example through email marketing. Depending on the objectives of the Performance Marketing campaign, this information will be useful in identifying whether a CPL or CPA payment method is more appropriate. 
  • Social Media Monitoring : the most used social platforms today offer insight systems that include a series of metrics of particular interest to marketers. These are the so-called monitoring tools, sometimes native, other times external to the platform itself and hosted on dedicated software, and which allow the identification of essential information to optimize the Performance Marketing campaign according to the specific characteristics of the public. At the same time, monitoring the results obtained on social networks makes it possible to eliminate actions that do not generate engagement or redemption and to replicate or implement strategies that instead work. 
  • Viewing rates : typically this metric refers to posts (for example those present on a corporate blog) and offers the main advantage of measuring which content, themes or topics are of real interest to the target audience of the project. Based on these results, the Performance Marketing campaign can be aimed at increasing visits or increasing the engagement of users with specific content. 

Performance Marketing: Advantages and Disadvantages 

Now that we have clarified what Performance Marketing is and how it is measured , let’s find out what are the main benefits – but also the disadvantages – that characterize this method.

The main advantage of Performance Marketing is represented by the possibility, for marketers, to calculate the ROI of a given project to the millimeter, i.e. the return on investment in terms of income generated by specific marketing actions. As it is easy to guess, the ultimate goal of the project will always be to increase this factor.

The ability to essentially pay only for the results obtained allows, in Performance Marketing, to significantly reduce other types of investments . However, it is good to always keep in mind that reducing does not mean canceling completely: there will in fact be changes to be made in the running and that will not be linked to immediate monetization, or synergistic changes that will affect a series of marketing tools to ensure that one of they in particular perform better. We could define these as intermediate phases , which will always be considered as vital to the success of a Performance Marketing project . 

On the other hand, the possibility of keeping track of an infinite number of metrics and statistics essential to evaluate the real-time trend of a campaign is a plus of great value, because it allows to adapt the marketing mix proposal to the real behavior of the reference users.

If we were to talk about the typical disadvantages of Performance Marketing , the first and most important would clearly be that of very high competitiveness . Competition with competitors who implement similar strategies is an element that must always be taken into consideration already in the preliminary stages of defining campaigns. To this crucial “node” will then be added the limit of not having certainty of conversion (neither in qualitative nor quantitative terms) preventive : the success of a Performance Marketing project is defined not a priori, but in progress, and it is always the result of advanced and performing technological platforms and the action of marketers trained in online strategies . 


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