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title: What is Performance Marketing? Why it is important in 2022!

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# What is Performance Marketing? Why it is important in 2022!
![](https://i.imgur.com/qoUlgyW.png)

## What is Performance Marketing?
Let’s understand the meaning of performance marketing, it is a form of marketing based on performance. Most likely, you must have seen ads while scrolling through Instagram or watching videos. These are performance marketing campaigns. But a successful performance can vary as per the demand of brands, and marketers only pay when the desired goal is achieved. For some, it might be leads and clicks, while for others, it might be bookings or views. 

## Statistics to manifest the value of Performance Marketing
Performance marketing has witnessed significant growth with the rising popularity of affiliate and SaaS platforms. In addition, the change in consumer behaviour post-pandemic era has also contributed to the pacing up of performance marketing. 

Data-driven performance marketing can now be a powerful marketing strategy for creating brand awareness and generating leads. Yourstory mentions that by understanding the behaviour of the target audience and their preferences, companies have witnessed a gain of 30% in market efficiency. Moreover, the companies also reported a 10% top-line growth while keeping the marketing budget constant. The statistics suggest a higher return on investment than other marketing activities for branding, keeping the budget constant. 

The growing interest of companies in performance marketing to drive results was estimated to be around $6.82 billion in 2020. 

## Is performance marketing changing? 
Since the time people have interacted on digital platforms, the way they think, behave and act have evolved. The use of mobile phones has increased rapidly, with more than 5 million people owning a mobile of their own. Brands and companies have used this opportunity for years to reach their target audiences. 

In addition, with machine learning and artificial intelligence, digital marketing strategies have changed drastically. To cope with the emerging techniques, marketers have to change their mindset regarding performance marketing. However, the shift of more and more users to digital platforms has increased the demand for performance marketing brand owners. 

## Why do brands need performance marketing? 
Many brands and marketers have a blurry idea about the difference between brand marketing and performance marketing. However,  a good performance marketing strategy without the support of branding principles is less likely to give long term results. 

But, when backboned by a brand’s principles, performance marketing not only drives results but also helps in building brand image. Moreover, with the large amount of data in hand, brands have found it perfect to understand their consumers’ behaviours and optimise their marketing tactics. 

Below we have mentioned top channels that you can use to drive your performance marketing campaigns.  

## Top Performance Marketing Channels 
### Social Media Marketing
Social media is a bonanza for brands targeting large-scale audiences. Every social media platform has a different way of attracting consumers. A proper social media performance marketing strategy can help digital marketers do wonders for their clients. The **[positive effects of social media](https://techindustan.com/positive-effects-of-social-media/
)** are becoming evident as it’s helping start-ups and small businesses to become players.

### Programmatic Display Advertising
Another awesome marketing strategy that you can count on for enhancing your performance is programmatic display advertisements. In simple terms, just like the billboards hung on the roadside, display ads are the digital visually soothing and striking banners on online platforms like websites, youtube, etc. 

### Search Engine Marketing (SEM) 
To attain **[benefits of SEO](https://techindustan.com/benefits-of-seo/
)** and rank organically on top of search engines, extensive keyword research, creating quality content and long hours of consistency is required. To cut the chase, SEM increases traffic using paid and unpaid practices with minimal hassle. For the paid search marketing, advertisers mainly fouses over the pays for clicks while on unpaid advertising such as search engine optimization relies on search engine’s own algorithm. Companies measure SEM based on performance whereas others opt for partnerning and paying out commissions based on campaign performance. 

## What are performance marketing benefits
Here are five key benefits to consider that performance marketing provides over traditional approaches:

### Better planning
Without saying, your budget planning goes way better with performance marketing. As you can get an estimate of your campaign budget beforehand. Let’s say you are targeting 5000 visitors in a month on your website and are expecting to pay around $0.40 per click; the estimated expense for this campaign will be $2000.

### Prioritizing Your Goals
The strategy for performance marketing is built by considering the campaign’s goal. This gives brand following performance marketing an edge over their competitors as they are more likely to reach their target audiences. 

### Pay for results
In traditional marketing techniques, the brands had to pay for the campaign before any visible results. Most of the brands weren’t satisfied with the results they got in the future and found the campaign a waste of money. Performance marketing resolves this issue by working on the pay the resulting model. 

### Track performance
Performance marketing is known for its near-instant insights and results. The matrix of no. of clicks, impressions and leads can help marketers track the performance and customise the strategy considering the insights. 

## How Does Performance Marketing Work?  
Four groups are involved in the creation and execution of successful performance marketing campaigns, and they all work together to achieve the desired results.

### Retailers or Merchants
Also perceived as advertisers, these are groups of individuals who aim to convert their target audience into potential clients. They can be brands or companies selling products or services. 

### Publishers or Affiliates
The publishers or affiliates are a group of individuals who own social media presence like websites and social media accounts with huge traffic. Advertisers use these channels to generate leads for their company by publishing banners, videos, etc.

### Networks and Platforms 
Networks or platforms are the connecting bridge between advertisers and publishers. These platforms ensure smooth dealing between the two parties and the security of payment. The features embedded in these platforms ensure that everyone is on the same page when it comes to tracking campaign success. 

### Outsourced Program Managers (OPMs)
OPMs are the agencies dedicated to providing full-time performance management services. Companies no longer have to be worried about getting the job done all by themself. They can simply make a contract with agencies and guide them through the requirements. 

### Wrapping it up
Performance marketing is the need of the hour. To create successful performance marketing, you need to master both theoretical knowledge and practical implementation. However, it is difficult for Brand owners to look into the marketing of their products. Nothing to worry about, though. Connect with a reputed agency and let them get it done for you! 

One such reputed company is **[tecHindustan](https://techindustan.com/
)** that’s helping brands to grow digitally and meeting their conversion goals. Get in touch with us to learn more!


**Source:  [what-is-performance-marketing-why-it-is-important-in-2022!](https://techindustan.com/what-is-performance-marketing-why-it-is-important-in-2022/
)
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