What is performance marketing or pragmatic marketing and what is its application?
There are people who think that when it comes to the internet, marketing becomes difficult because eye contact with the customer cannot be established. Meanwhile, most customers will definitely respond positively if they find a good purchase offer. In other words, marketing is best implemented without direct eye contact or even verbal communication between two people.
What is performance marketing?
First of all, before defining performance marketing, you should know that this marketing method is one of the least risky marketing methods. In other words, you will spend as much as marketing benefits you. This issue is one of the most important factors in having a successful marketing method.
But all kinds of online advertising on different platforms, for example, banner ads on websites with good rankings on Google, use of famous social networks, email marketing, etc. It is in the performance marketing category. Let’s explain this method better with an example.
Imagine you are the owner of a website that retails in the field of technology (smartphones, cameras, laptops and accessories for these products). Elsewhere, out of personal interest, a person started a magazine website to promote and compare the latest developments in technology. You offer the owner of this site to add your brand as a banner ad in a corner of their site (this is just one type of implementation of performance marketing ads). Once the ad is displayed and people click on it to make a purchase and are directed to your site, most of the marketing is done. Now it’s time to think about the share of the site that buys the person and advertises from this sale.
When a customer performs positively against the ad and makes a purchase on your site (as long as this customer is directed to the same ad), you are obliged to give him a percentage of the sales profit according to the contract you made. website. give. This means that the more positive the customer’s performance, the higher the marketer’s profit will be. Therefore, this type of marketing is called pragmatic marketing.
Who participates in pragmatic marketing?
As you can see from the example above, we have two sides to pragmatic marketing. One of them is called the advertiser (or the person who orders the ad – the brand owner) and the advertiser (or the person who executes the ad – the owner of the advertising platform). Of course, many people will play a role in this.
For example, in cases where content marketing is integrated into practical marketing, content writers will also play a role in this regard. Or if we consider the same banner ads, a graphic designer is required to design this banner.
On the other hand, since pragmatic marketing is a branch of digital marketing, the digital marketing manager also plays a role in this type of marketing (graphic designers and content producers can be considered a subset of the digital marketing team). In cases where ideas cannot be followed by this manager, an idea owner in the team will also play a good role.
How does performance marketing work?
There are three different models of performance marketing: the retailer with a direct need for performance marketing, the publisher or affiliate that deals with this type of marketing, and finally the sales collaboration agencies that do the marketing.
Retailer or merchant wants direct performance marketing
Imagine that you are the owner of a restaurant that is just starting its operations. Naturally, until they know the quality of your food, customers will not consider it among their food purchasing preferences. So how can we tell them about the taste and quality of the food until it is sold?
The answer comes down to pragmatic marketing. Meanwhile, influential people who have influence among people, such as Instagram influencers, promote you. It no longer matters exactly which product you have available for retail. Are you just a restaurant or do you sell cosmetic products?
A publisher or sales representative joins sellers and helps them with performance marketing.
In some cases, a business may have a long-term contract with a publisher to perform performance marketing. If you remember the same example above, digital products are in exactly the same category as the sales site and the online magazine that promotes and compares products.
Consider at this point that some businesses create their own publishers. For example, Digikala launched Digimag to offer useful and practical content to its customers, as well as to promote its own products.
Affiliates or sales collaboration whose work is active marketing
Making a contract with agencies for cooperation in sales is another performance marketing model in which the amount of sales resulting from the cooperation of agencies determines the amount of investment. For more information about collaboration in sales (Affiliate Marketing), see the article.
Pragmatic Marketing Practices
Since pragmatic marketing is one of the branches of digital marketing, it can be said that performance marketing can be included in every business field where digital marketing can be effective. But its most important use can be seen in the largest internet-based company.
Have you ever been interested in Google Ads? Have you ever wondered what one of Google’s sources of revenue might be? That’s exactly what pragmatic marketing is all about. Google has tried to reach out to many websites that need more traffic and users in a particular period by offering a service called Google Ads or Google Ads. On the other hand, Google was charging fees from users directed to target sites.
If you are careful in your searches, some websites will have Ads next to their links. These are things that Google is trying to increase its visibility with the help of pragmatic marketing. Now, depending on the type of feedback from this ad and the number of users clicking on the link, Google determines the payout rate of the advertised website. This means investing in marketing and advertising based on customer feedback.
Advantages and disadvantages of choosing performance marketing as a method of attracting customers
Perhaps the most important advantage of choosing performance marketing is cost savings. As we mentioned before, remember that you will pay as much as the advertising and pragmatic marketing performance will benefit you. So, unless you have a serious profit, you do not need to incur large expenses. Other advantages of this attractive marketing method include:
- Work progress is fully measurable.
- You can expand your marketing methods.
- Your income channels will increase.
- Innovation and creativity increases in the organization.
- You’re finding the right place to market your business.
When it comes to finding the right place to market your business, it’s important to understand that not every business has customers on every platform. For example, if you advertised pragmatically on Twitter and didn’t get engaging results, your customers are probably not fans of Twitter. In this case, you need to know your customer’s personality correctly so that he can find his workplace . In this case, buying and selling will be done more widely.
Meanwhile, some people think they may incur excessive costs in the way of performance marketing.
This is because it is up to the brand owner to choose customer performance as a positive trend in marketing. That is, the brand owner chooses whether clicking on the website link will be a customer action or a product sale. However, the rates of these two options are definitely different. This can leave business managers wondering if it’s worth it.
On the other hand, there is always a fear in the hearts of businesses that this marketing method will not work at all. Even if we assume that the company does not pay any money for active marketing, the time spent waiting for results and not receiving results is a waste in itself. These two are the main disadvantages of performance marketing that prevent many people from choosing it; Performance marketing implementation channels include:
- Search Engine Marketing (SEM)
- Social networks (Social Media Marketing)
- email marketing
- Video Marketing
How to optimize performance marketing
The first point is to make sure you are doing performance marketing in the right environment. This is achieved when you know your customer correctly; However, to implement optimal marketing performance, your product’s user interface must be well designed, attention should be paid to UI and UX , and users’ progress should be carefully tracked.
On the other hand, you should carry out A/B tests step by step to check the results of your work more closely ; After all, if you have a good digital marketing team, they definitely know these points and take them into consideration when applying different digital marketing methods.
