Performance marketing offers you a strategy for data-driven marketing . This allows you to quantify performance and, ultimately, success Performance Marketing or failure. The measures in this concept are designed for measurable user interactions, enabling ongoing campaign optimization.
In this article, I will show you what is all about and how you can implement it.
What is performance marketing?
What role does performance marketing play in the marketing mix?
The overall goal is to create the most efficient marketing measures . The costs of advertising measures are scabased on the success of a campaign, which is measur in terms of sales, leads, or clicks.
Performance advertising, in turn, is mostly used to acquire new customers and retain them.
And: The market is growing . According to statistics, spending on digital advertising in Germany is rising rapidly. Has two key characteristics:
- Measurability : KPIs (key performance indicators) must be quantifiable in order to evaluate user interactions. Only then can cross-border cooperation and resource sharing optimizations be made based on them.
- Modularity : Relies on different communication tools, each of which can be measur and optimiz independently. This allows for small adjustments to be made even within an ongoing campaign to achieve the best possible results.
The seven most important KPIs in performance marketing
I’ve already touched on this : is primarily based on measurable metrics, or KPIs . You can track dozens of them—but not every KPI is relevant for every company. Here’s an overview of the most important ones in my opinion:
- Click-through rate (CTR) : The CTR indicates, as a percentage, the ratio of users who click on an ad to all those who see it. The higher the CTR, the better.
- Conversion Rate : This KPI shows the percentage of users who perform a desired action—such as purchasing a product or subscribing to a newsletter. Here, too, the simple rule of thumb applies: “The higher the better.”
- Cost per Click (CPC) : CPC measures the cost you incur for each click on your ad. I’ll explain more about billing models for marketing campaigns later.
- Customer Acquisition Cost (CAC) : The CAC indicates how much it costs you to acquire a new customer. The lower the better.
- Return on Investment (ROI) : ROI business sale lead measures the profit or loss relative to the costs of activities across all marketing channels . A positive ROI indicates profitability.
- Customer Lifetime Value (CLV) : CLV estimates the total value a person generates over the course of their relationship with your company.
- Bounce Rate : The bounce rate measures the percentage of visitors who leave your website after viewing just one page. A high bounce rate indicates that your page isn’t engaging or relevant enough.