Making success measurable with performance marketing

The success of your online shop is measurable. And everything you can measure can be optimised in a targeted manner. Performance marketing provides you with the right strategies and tools to evaluate, analyse and adjust the performance of your marketing measures using objective key figures. Performance marketing gives you the chance to significantly increase the efficiency of your campaigns and thus the overall success of your online shops – based on well-founded values.

What is performance marketing?

Performance marketing is a discipline of online marketing and is also known as performance advertising. Since it has become possible with certain tools to track advertising measures and make them measurable, performance marketing has gained a lot of importance. The focus is on the measurability of performance. Based on objective data, performance marketing also includes evaluation and optimisation. The measurement of the user’s reaction and interaction with an ad in performance marketing is carried out using so-called KPIs (Key Performance Indicators). The collection of data can be implemented with different tools. These are the ingredients of performance marketing.

With performance marketing, you can quantify almost any of your advertising campaigns – from banner ads to exit-intent pop-ups or newsletter pop-ups on your site to the last social media post. The goal of performance marketing is as clear as the numbers you gain. It’s about optimising your marketing efforts so that they achieve maximum efficiency. Especially in the areas of new customer acquisition, customer retention and customer communication, performance marketing shows its qualities.

The most important KPIs in performance marketing are

• Click rates
• Cost-turnover ratio
• Conversion rate

This is what performance marketing is all about

Two things are relevant in performance marketing: measurability and modularity. This means that the interaction with your customers through, let’s take your last advertisement, must be quantifiable with the relevant KPIs. At the same time, with performance marketing, every advertising measure, regardless of which channel you implement it on, can be evaluated and optimised while the campaign is still running. Repeated measurements and evaluations show you to what extent the adjustments are working or not.

The most important key figures of performance marketing

To measure your performance marketing efforts, you need the right metrics. Always decide on the basis of your marketing goals. Basically, in performance marketing you have the possibility to measure the interaction of the user on the basis of clicks on the banner, the subscription to a newsletter or to evaluate the turnover of certain advertising campaigns. Ultimately, the measurability of the end goal, such as in your case the conclusion of a purchase, in relation to the traffic is also important. The following three KPIs are suitable for performance marketing:

Cost-turnover ratio

Describes the costs of your marketing in relation to sales.

Cost per Action (CPA)

Describes the costs incurred for a user action in relation to the result.

Conversion Rate

Reflects the ratio of the number of your visitors and an action (conversion).

Tip: Measure performance marketing over a longer period of time, take special features such as holidays or weekends into account and differentiate figures from different data sources.

What are the benefits of performance marketing?

Before we turn to the “how to”, let’s take a brief look at the advantages of performance marketing that you can use for yourself:

• measurability of campaigns and advertising measures
• modular design
• sound basis for optimisation measures
• Increased efficiency through customisation
• continuously repeatable
• oriented towards KPIs
• Use of tools for data collection

How does performance marketing work?

Four areas are addressed in the implementation of performance marketing:

• Target definition (measurable goals)
• Action planning and implementation
• Controlling (monitoring) with analysis tools
• Optimisation based on the data

With the results from performance marketing, you don’t have to wait until a campaign is over to do better with the next one, but can optimise measures that are already underway.

Defining goals in performance marketing

In order to measure the performance of measures, you should first formulate goals that you want to achieve with a campaign. The most important criterion is measurability.

Measurable goals are, for example, that you gain 20 new customers in the next three months. Performance marketing therefore needs goals, formulated in numbers.

The areas you choose for performance marketing goals can be quite different, as long as they remain measurable. You can set the goal of increasing your awareness (pull marketing), increasing sales, gaining more customers, increasing customer loyalty, improving the click rate or pushing the number of your visitors (push marketing).

Marketing measures in performance marketing

In order to achieve your chosen goals in performance marketing, you need the right instruments to implement them. Here you have a whole range of possibilities. A healthy mix is ideal. While some of the measures, such as search engine optimisation or social media marketing, are indispensable today, efforts such as in regional marketing are more individual in nature.

In performance marketing, the instruments you can choose from are:

• SEA: paid search engine advertising with ads
• SEO: search engine optimisation to improve your ranking in organic search results.
• Social media marketing: building up profiles and your own community on Facebook, Instagram and co. with the possibility of placing ads here. The social proof increases your conversions.
• Display advertising: banner ads on third-party sites.
• Regional marketing: regional marketing efforts for placement in the local environment
• E-mail marketing: Addressing customers directly by electronic mail with newsletters, promotional e-mails or even abandoned cart e-mails to optimise your conversion rate
• Affiliate marketing: links to the offer embedded on a third party website
• Pop-ups: visual elements appearing on the page for advertising messages

Controlling in performance marketing

In order to examine the efficiency of your measures, you must track or record them in performance marketing. Various analysis tools are available to help you do this.

Google Analytics

Probably the most common analysis tool in performance marketing is Google Analytics. This service evaluates numerous data from a website. You gain exact insights into the number of visitors to your website and how they behave. Even the free basic version

The free basic version already provides you with numerous analyses. For comprehensive performance marketing, however, you should consider the premium version.

XOVI and Sistrix

The tool XOVI analyses the SEO performance of a website and shows the findability, visibility, backlinks and rankings. Sistrix also gives you sound insights into your SEO performance. You can test XOV and Sistrix free of charge for 14 days.

Acoonia

With the Acoonia software suite, you can monitor your email marketing. The tool allows well-founded insights into delivery rates, contains inbox monitoring including statistical projections of inbox rates for all email campaigns and opening rates, to name but a few. Acoonia can also be used for the evaluation of SEO. The fees amount to a monthly contribution.

Hootsuite and Fanpage Karma

Equally important are suitable tools for monitoring your social media activities. In this case, you can choose between Hootsuite or Fanpage Karma, for example. Both solutions offer you comprehensive possibilities to carry out well-founded analyses of your social media activities. In addition, the programmes allow you to plan, create and automatically publish posts.

Optimisation in performance marketing

You evaluate the data you receive in Controlling and use it as a basis for optimisation in Performance Marketing. If you have placed a pop-up on your website and now realise on the basis of the data that customers are not interacting with it, the next step is to see what the causes are. Are you not addressing your target group with the right content? Is a call-to-action missing? Identify potential for improvement and optimise it in a targeted way to gain trust. Then it’s time to measure the performance again.

Tip: Do you know the uptain® ALGORITHM for effective pop-ups that automatically play the right message to your customers at the right moment? Translated with www.DeepL.com/Translator (free version)

Use the power of performance marketing

Performance marketing has the advantage that you have access to proven and well-founded figures that can be easily measured and evaluated today thanks to smart tools. Data collection and evaluation ensures that you have a down-to-earth basis for optimising your marketing activities and can thus optimise in a much more targeted manner. With performance marketing, you adjust content in a targeted manner while the campaign is still running and thus prevent unnecessarily rising costs. Use performance marketing to also get the best out of your services and significantly increase your customer satisfaction.

Frequently asked questions about Performance Marketing

How does performance marketing work?

Performance marketing works in four steps: you define measurable goals, plan and implement your advertising measures, monitor them with analysis tools, and optimise them on the basis of the data collected. Because results arrive while a campaign is still running, you do not have to wait until it ends to improve. Adjustments can be made mid-flight, which keeps costs from rising unnecessarily.

Is performance marketing the same as SEO?

No. SEO is one instrument within performance marketing, not a synonym for it. Performance marketing also draws on SEA, social media marketing, display advertising, regional marketing, e-mail marketing, affiliate marketing and pop-ups, and a healthy mix of these channels works best. What unites them is measurability: every measure is tracked with KPIs and optimised on the basis of objective data.

What are the benefits of performance marketing?

Performance marketing makes campaigns and advertising measures measurable, which gives you a sound basis for optimisation. Its modular design means measures can be repeated continuously and adjusted individually, raising efficiency. Because everything is oriented towards KPIs and supported by tools for data collection, you work with proven figures instead of assumptions and can prevent costs from rising unnecessarily.

What is performance marketing?

Performance marketing, also known as performance advertising, is a discipline of online marketing in which the measurability of performance is the focus. User reactions and interactions with an ad are recorded through KPIs such as click rates, cost-turnover ratio and conversion rate, and the data collected then feeds evaluation and optimisation. Almost any campaign can be quantified this way, from banner ads to exit-intent pop-ups.

Which key figures matter most in performance marketing?

Three KPIs are particularly suitable: the cost-turnover ratio, which sets your marketing costs in relation to sales; cost per action (CPA), which shows the costs incurred for a user action in relation to the result; and the conversion rate, which reflects the ratio between visitors and completed actions. Measure over a longer period and account for holidays and weekends.

How do you define goals in performance marketing?

Start by formulating goals in numbers, because measurability is the most important criterion. A workable goal is, for example, gaining 20 new customers in the next three months. The area is up to you: increasing awareness, raising sales, winning customers, strengthening customer loyalty, improving the click rate or pushing visitor numbers all qualify, as long as the result stays countable.

Which tools help you track performance marketing?

Google Analytics is the most common choice and shows how many visitors reach your site and how they behave; the free basic version already delivers numerous analyses. XOVI and Sistrix cover SEO performance, findability, visibility, backlinks and rankings. Acoonia monitors e-mail marketing including delivery and opening rates, while Hootsuite and Fanpage Karma analyse and schedule social media activity.