Today, one of the new methods in the world of performance marketing is the marketing that many marketers use today. In other words, performance marketing is a completely scientific and performance-based method, the biggest feature of which is paying for a specific result. Join us until the end of this article to introduce this new marketing method, to fully explain it.

In this article, we take a look at what performance marketing is, what types it is, and who needs performance marketing at all. In the past, this model was more common for some people to do the advertising process in such a way that they ask for a certain amount of money for n clicks or impressions on social media pages. But over time, more and more advertising methods have emerged, and performance marketing is one of those new methods that give you the power to gauge every factor to find the best marketing method for your business. In this article, we will first define marketing performance and take a comprehensive look at this marketing method. So stay tuned to Targeted Web Traffic.

Performance marketing; The best way for targeted and profitable advertising?

In the definition of performance marketing, it can be said that pragmatic marketing or performance marketing is an online advertising model in which the customer only pays you if he succeeds. Pragmatic marketing is more commonly known as an Internet method. The question may arise in your mind whether the phrase “best advertising method” can be attributed to performance marketing. If you think a little about this type of marketing, you will probably find that it is a win-win situation.

On one side of the deal is a businessman and on the other side is a publisher or marketer. A successful marketing performance empowers both parties to experience more successful campaigns with fewer errors, and the trader is more comfortable with his or her return on investment; This is because the main concern of a businessman or retailer in the field of advertising can be understood in the rate of return on investment. We will explain what the rate of return on capital means in the continuation of this article.

Is performance marketing the same as affiliate marketing?

Affiliate marketing is one of the most lucrative and best ways to make money online. However, affiliate marketing is a very new method, which, of course, at the time of the emergence of this method in Iran, it was predicted that the value of this industry will have a significant growth rate year by year. Affiliate marketing is really crucial for digital marketing strategy. This type, as its Persian name implies, is a type of marketing that has a very direct effect on product sales.

This type of method is also known in Iran as payroll marketing, in which people often outside the business are commissioned to sell certain products to customers and receive a fee as a fee for the number of products they sell.

In affiliate marketing, programs are set up to estimate and analyze the success of advertising. For this reason, even if this is not done online, it can be considered a type of performance marketing. In other words, affiliate marketing can also be considered as performance marketing and performance marketing is in fact a subset of affiliate marketing.

Simply put, affiliate marketing or sales collaboration service includes methods such as influencer marketing, email marketing, search marketing, and any other method in which, if one side of the transaction succeeds, it receives a commission or commission. Provides for the other party. With all these interpretations, in the performance marketing method, costs can vary, because the method used for advertising also varies depending on the type of interaction.

Groups in the performance marketing system

Before we get into what types of marketing are, we need to look at how this type of marketing works at all. There are 4 groups in the performance marketing system:

  • Merchants: In fact, they have the role of advertisers; People who want to promote their products and services need competent marketers.
  • Publishers or sales associates (affiliate marketers): They are affiliate partners in performance marketing and these partners can be review sites as well as social media influencers. A business may want to sell a certain item as soon as possible. Therefore, sales partners will play an important role in this cycle.
  • Affiliate Networks: Having this group is highly efficient for sales associates. In fact, affiliate networks allow publishers, influencers, and even businesses to explore a number of factors. These networks provide publishers with tools such as product feedback and payment links to better promote advertising strategies in the future. Affiliate networks provide strengths and weaknesses to experts in the field.
  • Affiliate Managers: Managers of marketing or sales collaboration agencies are the main intermediary between the publisher and the merchant, and most merchants turn to this group of people to start a partnership.

Types of performance marketing

Now that we are more familiar with the performance marketing cycle and its components, let’s look at what types of performance marketing or pragmatic marketing are:

1- Affiliate Marketing model

This was explained earlier in this article and is called marketing, in which a person who does so is given a commission in return for selling the product. This method is being seriously implemented in Iran these days by Digital Company. It is recommended to refer to Digital Affiliate Marketing System and get complete information.

2- Native Marketing

This type of advertising can be considered a smart model; Because in this method, attractive and oriented information is considered for the users of a site or social page, and in this method, this presentation of information does not look like an advertisement and appears non-advertising. Of course, native marketing can also be done as a suggestion or recommendation at the end of an article or news item.

3- Sponsored Marketing

Sponsored content is a method you have probably seen many times on social networks like Instagram. Because this method is mostly performed by influencers; In this way, a permanent or temporary post is placed on the page of an influencer and the publisher receives a fee for this. Of course, there are also bloggers who do advertising for free. In the latter scenario, the merchant or business may enter into a contract that pays the influencer in return for clicks or sales.

4- Social Media Marketing

In this way, the use of social networks is the most central thing to focus on. Content or product information is shared on popular virtual networks such as Instagram, Telegram, Facebook and. The elements that are measured in this type of marketing are usually defined as the number of likes, comments, clicks, and in general the amount of engagement (Engagement).

5- Search Engine Marketing

Search engine marketing has a detailed discussion and is done based on two types of organic and paid. In short, in the organic method, the person or company tries to index the pages on the first page of search engines like Google by resorting to SEO techniques (please read the article, What is SEO?) And recognizing the algorithms of search engines such as Google and Bing. Slowly There is no need to know about SEO in the payment method, and you can only be seen for every click on the banner ad, and as long as you spend, the payment method can be efficient.

Who needs performance marketing?

Any new or old business that has an audience in cyberspace can use performance marketing. These businesses can be small or even large companies such as insurance that need direct advertising to attract customers. The smaller the budget of a business, the more brands are willing to take advantage of pragmatic marketing; Because the return on investment is a very serious and vital issue for these companies that do not benefit from strong financial stability.

In general, this marketing method targets people who spend a lot of time on the Internet, and it seems natural for a company to want to use the number of people who roam social media on a daily basis to their business. Slowly, Of course, older people who join social media just for fun are not often the target of pragmatic marketing, and young people are usually targeted by marketers in this type of marketing. As mentioned earlier, payment methods in this marketing method have a variety of benefits.

Payment Performance Marketing Methods

Payment methods in this type of marketing are divided into four categories:

  • CPM or Cost per Thousand: Cost per 1000 views to users
  • CPC or Cost Per Click: The cost per user click on an ad link
  • CPL or Cost Per Lead: Cost per registration or registration of information by each user
  • CPA or Cost Per Action: The cost per operation or purchase

What is ROI and what does it have to do with performance marketing?

In fact, ROI stands for Return on Investment, which we referred to earlier as “Return on Investment.” Do you think your marketing has been extremely successful and effective? Along with other parameters that you need to analyze, ‌ you also need to check the ROI. Usually, someone who is considering investing will be asked a simple question: Has the marketing campaign been profitable for the company? The ROI should simply state what the exchange rate is compared to the money invested. Of course, the marketing process is beneficial when the rate of money earned is greater than the amount of money invested.

Accordingly, ROI is a very important factor that should be considered by everyone. You may spend one million tomans for an ad. On the other hand, how many users are attracted to your site and how many products you can sell through the same number of users that are attracted to the site. But you sold exactly one million tomans. In this scenario, your return on investment or numerical ROI will be zero percent. You have neither benefited nor lost, but the process and energy you put into advertising is futile and needs optimization.

Return on Capital Rate Formula (ROI)

You will be able to calculate this factor using a formula to get your rate of return or ROI. To get ROI using a formula, you need two quantitative factors: Net profit and advertising cost. If the rate is negative, you have lost money in the business, and vice versa.

This formula can be a very good evaluation to evaluate the outcome of a marketing method well and based on mathematical logic. If you keep track of your ROI, you will probably find the best advertising solution a few times. Of course, it should be noted that in the ROI formula, net profit means that you have reduced the costs of the production and supply process of your services from the total profit. Otherwise, regardless of the other side costs of a business, your profit is gross and, as a result, you may find yourself struggling to find the best advertising solution.

Of course, it is difficult to measure the rate of return on capital, and it is very difficult to determine the rate and consider it the most accurate ROI. You may be wondering why? Someone may simply lure you into using a service or buying a product. In this scenario, the ROI cannot be calculated so easily with a mathematical formula. That’s why performance marketing is so different for Internet businesses, not just word of mouth marketing.

Accordingly, some advertising methods require special tools for measurement. In these processes, one must also consider the “time” factor, which may upset all equations. In simpler terms, even the amount of money an employee spends on advertising should be calculated in some way. There are many intervening variables in the ROI calculation process that if you want to find them all and then use the mathematical formula based on them, then you can say that you have obtained the ROI very accurately. You may be wondering why we need to bother to accurately measure our return on investment. What is the statistically significant impact of the error rate?

Benefits of Accurate Measurement of Return on Investment (ROI)

By accurately measuring your rate of return, while not only realizing how much a customer is worth to a business in the long run, you can also focus on your audience’s behavior to see how your customers respond to marketing and be more willing. they give. Are customers attracted to your business product or service by using brochures and visual methods, or do “direct marketing” methods such as holding events and seminars motivate them to buy a product or use a service? By accurately calculating your ROI, you can also find out which type of marketing method can work best for your return on investment.

Fortunately, in online marketing, thanks to online analytics apps like Google Analytics, you can analyze your rate of return with great accuracy. Of course, working with Google Analytics and the capabilities of this software in measuring ROI requires another more detailed article, and the whole nature of Google search traffic in accurately measuring the rate of return and its overall impact on performance marketing cannot be summarized in one or two paragraphs.

Performance marketing is an ideal method for internet businesses

As a result, if you have an online business and you want to keep a steady growth rate through a series of high-paying ads, you need performance marketing, and for that you need to constantly monitor your rate of return. You have to work on the behavior of your audience as well. Another important point is not to rush to identify the best way to attract customers and move forward with thought.

Definitely, a calculated and powerful marketing performance will make your business with a positive slope, in the best possible time to generate good income because in the first place you have been able to properly and using the best marketing method you have found to attract valuable audiences to your business. do. What is your opinion on this type of marketing? Share your comments below this post.