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What is Performance Marketing?

Performance marketing is a hot trend in digital marketing. It’s all about working with numbers and measurable indicators known as KPIs (Key Performance Indicators). These indicators can include clicks, reach, leads, sales, profit, LTV (Lifetime Value), ROI (Return on Investment), and other marketing metrics. The core of performance marketing is connecting overall business goals with specific processes in a unified system.

In the realm of performance marketing, digital marketing is viewed as a combination of various systems: traffic, landing pages, advertising systems, analytics, sales funnel management, post-sales services, communication systems, and conversion optimization. All of these components work together towards achieving the ultimate business goal — profitability.

In this approach, effective marketing becomes a mathematical model that breaks down the sales plan into individual tasks. For example, increasing traffic from paid channels by 25%, improving lead conversion by 1.2%, and boosting operator conversion by 2%. The cumulative impact of enhancing multiple processes is greater than improving just one.

Performance marketing always leads to specific growth or decline figures resulting from changes in each process.

Organizing Performance Marketing

The first step in building a performance marketing system is measuring what you have:

  1. Evaluating the competitive environment.
  2. Mapping out business processes.
  3. Studying internal processes, including sales department operations and identifying internal growth points.
  4. Charting the customer journey.
  5. Segmenting the target audience.
  6. Creating a product matrix.
  7. Identifying key metrics and measuring them.
  8. Determining touchpoints with the target audience.
  9. Collecting and analyzing data from past periods.
  10. Allocating marketing budgets.

Among the KPIs can be visitor count, returns, conversions at all stages of the sales funnel, LTV, ROI, sales department efficiency metrics, and many others.

The second part involves setting specific goals that align with overall business objectives. These goals should follow the SMART criteria:

  • Specific: The goal should be clear and specific.
  • Measurable: The goal should be quantifiable.
  • Achievable: The goal should be realistic.
  • Relevant: The goal should be meaningful to the business.
  • Time-bound: The goal should have a deadline.

The combination of the first two parts forms the promotion strategy.

Based on this strategy, specific tasks are defined, and the appropriate individuals or teams are chosen to execute them. Some functions may be handled internally within the company, while others may be outsourced to advertising agencies, freelancers, or other contractors.

Regardless of how the process is set up, there should always be someone responsible for overseeing the entire marketing outcome and monitoring individual components.

Key Components of Modern Results-Oriented Marketing:

  1. CRM (Customer Relationship Management).
  2. Cross-channel analytics.
  3. Call tracking, call recording, and call analytics.
  4. Sales department scripts.
  5. Traffic channels (paid, organic, etc.).
  6. Landing pages, social media pages, and messaging platforms.
  7. A/B testing.
  8. HADI — Hypothesis, Analysis, Data, Implementation cycles.
  9. Process automation.
  10. Handling large data sets (Big Data).
  11. Data visualization systems.
  12. Analytics and prediction systems.

The result of implementing performance marketing is achieving business goals and obtaining actionable data for making management decisions.

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