Pay only for results? Great! But how might performance marketing impact your brand?
If you’ve ever watched an episode of the award-winning TV show, Mad Men, you’ll have seen the traditional (some would say “old-fashioned”) agency model at work. In this, the agencies charge their clients upfront for ad space and creative, and the agency would be paid, whether or not the work was successful i.e., when it didn’t perform well. How did they even know if the work actually made a difference? They looked at their monthly or quarterly sales numbers and tried to establish if the advertising had made an impact.
Why performance marketing is now top of mind
With digital marketing tools providing lots of data, with it comes the ability to ascertain what works and what doesn’t, and to optimise creative, channels and targeting to get progressively better and better return on investment (ROI).
Today, we live in a digital age, and there are other ways to do it, especially in the varied and complex world of digital marketing. With search ads, display ads, video ads, social ads, plus many other forms of PPC (pay per click) advertising and digital marketing tactics, the paradigm has shifted. With these advertising tools, it’s possible to attribute clicks, conversions and even the value of transactions and lifetime value of individual customers all the way back to the digital ads out there in the wild. Measuring the success of different campaigns, different platforms and even individual ads or types of creative messaging is all possible.
With digital marketing tools providing lots of data, with it comes the ability to ascertain what works and what doesn’t, and to optimise creative, channels and targeting to get progressively better and better return on investment (ROI). In many cases, data flows through in real-time, and platforms offer automated ways to favour the most effective ads and placements, so with a well architected campaign wastage can be minimised.
This is where performance marketing comes from. Performance marketing encompasses any type of marketing where a business only pays for specific actions taken by their target audience. Sounds perfect, right? Instead of shelling out money with no guarantee of success, you only pay if the advertising performs. The truth is though, neither model discussed here provides the optimal outcome.
Beware the race to the bottom, it can be a hard journey back to the top
So why doesn’t this new model of PPC performance marketing cut the mustard? Well, for some purposes it does. But, when looking at the whole picture, you must realise that your brand is more than just a click through rate. Working a search engine’s algorithm to get your ads higher up on page rankings may get you traffic, but your ads still need to be read by people – people who want to love and trust your brand. It’s similar to those who compete too heavily in the discount space, or on the cheapest prices. Unless that’s very carefully managed, that kind of activity can burn a brand to ash, and if you’ve ever dropped a cake or a glass, you’ll know that it’s easier to break something than it is to build it.
Those successful campaigns need to contribute to a continuous upward trend line for your brand, or your race to the bottom begins. Ask yourself about your customers’ experience, and how you are building brand equity concurrent to achieving immediate results. Contrary to what you may read, it’s possible to achieve both in the digital marketing space.
Another pitfall can be that once you get used to paying for traffic, paying for leads, paying for sales, you might get stuck in that model and forego the benefits of a great brand, with strong SEO, where customers who are in love with your brand seek you out.
Performance marketing as part of an overall ROI
We believe that even short term campaigns with ambitious digital marketing KPIs must be part of a carefully tailored strategy and be based on quality creative ideas that form part of a considered and user-centric, on-brand marketing journey for your customers. There’s also a quality and care factor with how performance marketing campaigns are managed. With the platform algorithms offering lots of automated support for digital marketers, you need to ensure that your campaign manager is still paying close attention to the goals of the brand, and not simply doing what the platform is telling them to do.
It’s worth remembering too that digital marketing is also just one channel in a whole array of marketing tactics that can all be used together to create impact and get results for your brand.
Focusing on the success of a single campaign with stringent digital marketing metrics may be a worthy short term goal, but strong brands are what persist over time and weather the inevitable storms. Yes, true ROI needs to be measured in conversions and sales made this month or this quarter, but also in your brand equity.
The great news is that it’s not rocket science to do both, it just requires some good strategic planning and thoughtful execution. It’s worth remembering too that digital marketing is also just one channel in a whole array of marketing tactics that can all be used together to create impact and get results for your brand.
At The Walk, we obsess over stats, because the data is valuable for measuring how people are responding to campaigns and creative. But we also believe that working hard to build brands alongside sweating the minutiae is the formula for long term success. It’s not always easy, but the hard things are the ones worth doing. Bring us your challenge and you’ll see that ROI doesn’t need to just be digits on a dashboard.