How do we define Performance Marketing?

14 July

Within the digital marketing universe, we can find a subcategory of strategies called Digital Performance. This strategy (or set of strategies) has the particularity of being results-driven and results-oriented. As the name says: Performance Based Marketing. Therefore, it is a necessity to work on a set of channels that are measurable (to be able to measure such results). That said, we can say that most of the traditional media could not be used for this type of strategy.

Before going into the marketing plan, it is necessary to understand which are the main channels that a Digital Performance strategy contemplates, since each channel will have a series of tools and tactics different from the rest.

• Social Media
• SEM
• Email Marketing
• SEO

So how to plan and implement the right digital performance strategy?

A plan will help align business objectives, organize initiatives to better connect with your audiences, engage them and drive them to action. While there are many ways to establish the steps for an effective performance plan, these are what I consider to be the main ones:

1-Define Objectives

Every company has its business objectives, whether to improve profitability, increase sales, expand markets, etc. Digital marketing objectives will be derived from these objectives. The objectives of the digital performance plan must be aligned with these business objectives, and at the same time they must be measurable, achievable, specific, relevant and contemplated in a period of time (SMART). These objectives can be established as KPIs, measurable and specific metrics that each strategy and campaign will deliver.

2-Defining targets, audiences and buyer personas

Having your buyer persona defined is of great importance, since from there we will be able to establish which types of audiences to impact. Segmentation in this step is important, since we will be able to communicate with a specific message to each of the audiences of our interest. It is also essential to carry out this point of the plan correctly in order to identify the channels to be used in the strategy (which channels allow me to reach the audiences of my interest).

3- Competitor analysis

For marketing efforts to be effective, we need to know who our competition is, what they do and what they communicate. A thorough competitor analysis will give us insights on how to leverage online marketing tools to outperform competitors (e.g., see which channels are strong and which are weak).

4-Establish a budget

Defining a budget will determine how much we can invest to achieve our objectives and will also serve as a guide to determine the channels, campaigns and strategies to be used. In other words, the budget will be distributed among the media for their respective tools to achieve our objectives. Establishing an accurate budget will depend on many factors such as: revenue, brand positioning, historical results, objectives, market, expected profitability, etc. While it is important to start with a solid budget allocation, we must be flexible to capitalize on campaign learnings once they are active (budget reallocation).

5- Define marketing channels

In this step we must choose the channels to carry out the strategy. The choice of these should take into account factors such as objectives, budget, audiences, etc. It is important to have defined our target audience for the choice of channels. For example, if our company is B2B we could use Linkedin, on the other hand, if our target audience is teenagers, a good option would be TikTok. Here we must focus on how to offer value to our audience within the channels they like the most. Synergy between channels is good: many times we will have channels that can work with common strategies and boost both media. For example: a PPC campaign that seeks to generate leads and accompany it with an email marketing medium to transform these leads into sales.

6-Develop marketing strategies for each channel.

Once we have chosen the channels, we must think about the best strategy to suit our objective. For example, if our channel will be SEM, we must put together a structure of search terms that will find our target audience when they search on the Internet, and deliver a specific message to each user.

Each channel offers different tools that suit different objectives. Example: Google Ads offers optimized campaigns to obtain app downloads and Facebook has product re-engagement campaigns.

In short, the choice of these strategies will depend on the points we have been working on up to this point, such as the commercial or business objective, the digital marketing objective, the budget, audiences, etc.

7- Calendarization

Every effective performance strategy includes a campaign implementation schedule. This is because not all strategies may start and end together. This point should also be affected by the timing specified in the strategy objectives. Gantt Charts are a widely used tool for scheduling.

Let’s look at an example:

For an application launch, we must establish at what specific time we will run campaigns for user acquisition, campaigns to improve profitability, campaigns to re-engage users, among others.

To achieve effective scheduling, we must take into account factors such as campaign implementation times, learning times, optimizations and objectives.

Measure results and KPIs of the marketing plan. Once the campaigns are active, the final step of the marketing plan is to measure the results of the campaigns (KIPs). We must make a comparison with the initial objectives of the campaign, and if the main KPIs are below expectations, we will proceed to an optimization process to improve performance.

It is important to measure the performance of each channel in order to establish which ones are working more successfully and which ones could be eliminated. Budget redistribution is ideal for this stage.