What is performance advertising?

Performance marketing is a means of advertising in which the marketer does not pay a set price, but rather the amount that it is paid is dependent on the performance of the ad.

Performance marketing is a means of advertising in which the marketer does not pay a set price, but rather the amount that it is paid is dependent on the performance of the ad. In such a case, the actual cost of an ad will be determined by how often it’s viewed on a webpage, how often visitors click on it, how often it generates a lead, and/or how often it results in a sale.

For these reasons, performance advertising is almost entirely restricted to the Internet, although mobile marketing campaigns have also recently started utilizing it.

Who is Performance Advertising Geared To?

From online car dealerships to retailers to service providers, any company that sells products or services over the Internet can use performance advertising. Because performance advertising allows for a client to purchase cost-per-action (CPA) ads, the client can be assured that every advertising dollar they spend will lead to a positive return on their investment.

Who does performance advertising reach?

Performance advertising ads are designed to reach those who spend a lot of time online or on their mobile devices. An ad can still promote an offline purchase, but most performance advertising campaigns are created to help convert online sales. This type of ad is most effective for marketers whose target audience is already comfortable with making online purchases.

The 4 Key Elements of Performance Advertising

To develop a successful performance advertising campaign, there are four key elements that the campaign needs to address. These include:

Attention-grabbing Ads

If your ads aren’t attractive enough to capture the attention of your audience, then your performance advertising campaign won’t generate much sales. Ads need to be well made and designed to spur your audience into the sales funnel.

Strategic ad placement

You also want to ensure that you place your ads in smart locations where your audience will be most likely to come across them. You can’t throw your ads out there into the world without a plan. Knowing where your ads are being displayed is an important part of ensuring maximum reach.

User-friendly landing pages

Landing pages play a large role in the success of a performance advertising campaign because they provide the visitor with validation for their interest in your ads. As a result, landing pages need to be user-friendly with easy to understand copy that encourages the visitor on to the next part of the sales funnel.

Monitoring and adjustments

One of the primary benefits of online advertising is that if an ad isn’t performing, you can simply swap it out with another one with minimal effort. So, as you might expect, real-time monitoring of your ad performance is another key element to increasing your return potential. It allows you to test new ads, compare results, and roll out the winning performer on a grander scale.