What Is Performance Marketing? [Definition, Strategy and More]


If you’re running a business, it’s important to track your marketing results so you can gauge the effectiveness of your campaigns.

In this article, we’ll discuss what is performance marketing and how you can measure the performance of your digital marketing campaigns. We’ll also:

  • highlight how the strategy of performance marketing works
  • provide tips on improving the performance of digital marketing
  • discuss some of the top channels for performance marketing

By the end, you’ll feel more confident about the topic and be able to make an informed decision for your business.

What Is Performance Marketing?

Performance marketing is a data-driven approach to marketing that focuses on generating measurable results. It is the process of tracking, measuring, and optimizing all aspects of your marketing in order to generate more revenue for your business. This type of marketing emphasizes ROI (return on investment) and aims to track and improve the performance of all aspects of your marketing campaigns.

Advertisers connect with publishers, media buyers, or media companies to design advertisements and post them on various advertising platforms. There are different types of performance marketing like social media advertising or search engine marketing. We’ll discuss them later in the article.

In this type of marketing, instead of the traditional way of payment, advertisers pay according to how well the ad has performed. It is quite easy to calculate, and performance marketing helps businesses allocate their resources judiciously instead of spending them on advertising programs that don’t lead to any results.

DID YOU KNOW: Marketing managers earn an average salary of $142,170! It is a good career option for people who are creative and interested in marketing!

How to Measure Marketing Performance

There are a variety of ways you can measure performance, and here are some of them:

  • Revenue and Sales

The first and most obvious metric to track is revenue and sales. This will give you a good indication of how effective your marketing campaigns are in terms of generating income for your business. You can track revenue and sales data in a number of different ways, including through your CRM (customer relationship management) system, accounting software, or e-commerce platform.

  • Leads

Another important metric for measuring marketing performance is to track the number of leads that your marketing campaigns are generating. The generated lead will give you an indication of how many potential customers are interested in your products or services. You can track lead data in a number of different ways, including through your CRM system, contact forms on your website, or by using a lead tracking tool.

  • Brand Awareness

Another metric that you can use to measure performance-based marketing is brand awareness. This refers to how many people are aware of your brand and what you do. You can track brand awareness data through social media monitoring, surveys, and research reports. Some also track social media follower count, the number of inbound links and the number of brands mentions online.

  • Track Anonymous Visitors Over Multiple Sessions and Traffic Sources

One of the benefits of performance marketing is that it allows you to track anonymous visitors over multiple sessions and traffic sources. This means you can see how people interact with your website, what pages they visit, and where they came from before they converted into a lead or customer. This data can be extremely valuable in understanding the customer journey and optimizing your marketing campaigns.

  • Send Conversion Data to the CRM

Another benefit of digital performance marketing is that it allows you to send conversion data to your CRM system. This means you can track not only how many leads and customers you generate, but also how much revenue each lead or customer is worth. This data can be extremely valuable in understanding the lifetime value of your customers. It will also make sure you are generating a positive ROI on your marketing campaigns.

  • Send Sales Revenue Back to Ruler Analytics

Ruler Analytics is a powerful tool that allows you to track, measure, and optimize all aspects of your performance media marketing. One of the benefits of using Ruler Analytics is that it allows you to send sales revenue data back to the platform. This means you can see not only how many sales you generate, but also how much revenue each sale is worth. This data can help you in understanding the profitability of your marketing campaigns.

  • Integrate With Other Web Applications

Another benefit of using Ruler Analytics is that it allows you to integrate with other web applications. You can use Ruler Analytics to track data from a variety of different sources, including your website, CRM system, accounting software, e-commerce platform, and lead tracking tool. This data can be extremely valuable in understanding the customer journey and optimizing your marketing campaigns.

DID YOU KNOW: As per a survey, it was found that 62% of the marketing budget is moving towards performance marketing! This highlights the importance of measuring performance marketing to make sure you’re on the right track!

Performance Marketing Strategy

The main benefit of performance marketing is that the payment is based on the ad performance. There are several ways to calculate this:

  • Cost Per Impression (CPM)

The first one is the cost per impression. Impressions are basically the views of your ad, and you pay for every thousand views. For example, if 30,000 people have viewed your ad, you will pay your base rate times 30.

  • Cost Per Click (CPC)

CPC is one of the key performance indicators of marketing. As the name suggests, you pay according to the number of times people click on your ads. It’s a good way to see how engaging the ads are.

  • Cost Per Sales (CPS)

Here, you pay when you make a sale that was driven by an ad. This is usually used in affiliate marketing and is a good way to determine whether your ads are leading to sales.

  • Cost Per Leads (CPL)

With this method, you pay when the ads generate leads. It is when someone signs up for something like a newsletter or provides their contact information. Leads eventually become sales.

  • Cost Per Acquisition (CPA)

This method is quite similar to CPS and CPL, but here you pay when people complete a specific action. It could be making a sale, visiting your website, or sharing their contact information.

DID YOU KNOW: A lead generation company or advertiser also places bids on keywords to make sure their ads show up when people search for them! A bid is the maximum amount of money they’re willing to pay for each click on the ad. 

How to Improve Digital Marketing Performance

Here are a few ways you can improve the performance of your digital marketing campaigns:

  • Focus on Conversion

The first step to improving the performance is to focus on conversion. This means making sure that your marketing campaigns are designed to generate leads and customers, not just traffic. You can do this by ensuring that your website is optimized for conversion, tracking lead data, and sending sales revenue back to Ruler Analytics.

  • Create the Ultimate Buying Journey

Digital marketers can easily determine which of their content is the most successful amongst customers. They can use this information to yield more sales. For example, if your brand knows that most of the leads come from social media, you can focus on social media advertising and make it easier for customers to go from your social media page to your website! To improve your performance-driven marketing and create the ultimate buying journey, you should also focus on optimizing the online and mobile shopping experience. A lot of people buy products from their mobile phones, and creating a smooth shopping experience will increase sales.

  • Focus on Long-Term Value

Every business wants repeat customers and long-term customer engagement. It is only possible when you focus on long-term value addition through campaigns. Research the various marketing platforms and allocate your resources accordingly.

  • Make Your Content Share-Worthy

Another thing to pay attention to is making sure that your content is share-worthy. This means creating high-quality, informative, and engaging content that will encourage your audience to share it with their network. Online marketing thrives on share-worthy blog posts, infographics, videos, and other types of content that engage the audience.

  • Keep Refining the Process

Another step to improving the performance is to know when and how to go back and refine processes. Various performance marketing platforms can help you do that. After all, no marketing campaign is perfect and there is always room for improvement. It’s important to understand the changes in your business and adjust your performance marketing accordingly.

DID YOU KNOW: It is also important to pay attention to where you’re getting the most customers from. Ask them where they heard about your brand and invest more in those channels! 

Top Performance Marketing Channels

Nowadays it is imperative for businesses to focus on their digital marketing if they want to increase sales. There are different channels of performance marketing that form the advertising landscape and businesses must choose the one that suits their needs the best. Here are a few top-performance paid marketing channels that marketers can choose from:

  • Native Advertising

Native advertising is a type of online advertising that is designed to blend in with the surrounding content. Native ads are often found in social media feeds, search engine results pages, and websites. These ads don’t really look like typical ads and are part of the content of the page. Native advertising is one way of battling ad fatigue which happens when your audience is exposed to too many ads – they eventually get bored and stop paying attention. As per stats, consumers are 53% more likely to look at native ads compared to display ads! This makes native advertising an efficient and popular performance marketing tool.

  • Sponsored Content

Sponsored advertising is a type of marketing where the advertiser pays for an ad shared or created by another brand or influencer. For example, you must have seen popular social media influencers sponsoring their favorite makeup brand. When done well, sponsored content can be incredibly engaging and informative, providing value to a specific audience while also promoting your brand or product. Plus, with platforms like Outbrain and Taboola that are a part of a content discovery network, it’s easy to get your sponsored content in front of a large audience.

  • Social Media Advertising

Another popular performance sales and marketing channel is social media. Considering the social media marketing stats and the time people spend on social media, it can help you reach organic audience segments by using any leading social media channel. You will have to choose a specific audience as a target and use relevant keywords to create ads that are likely to be seen by people who are interested in your offer. Make sure to pay attention to the platform you’re using. If you wish to target teens or young adults, you may prefer TikTok or Instagram as a platform. If your target audience is a bit older, Facebook is the place for you.

  • Search Engine Marketing

Performance management marketing also uses search engine marketing to improve brand awareness and attract the audience. SEM is a form of online marketing that involves the promotion of websites by increasing their visibility on search results pages. SEM initially included both paid advertising and search engine optimization (SEO) methods, but now mostly refers to paid search advertising. A major benefit of SEM is that it reaches the customers at the right time when they’re open to information, and this method certainly increases traffic to the brand’s website. Many marketers use the help of the Google Ads network so that their ads are visible at the right place and at the right time.

  • Affiliate Marketing

Any performance marketing manager can tell you the importance of affiliate marketing. In affiliate marketing, a company pays a commission to affiliates who generate traffic or sales for their business. Affiliates can be websites, leading online publications, or bloggers. In most cases, affiliates are paid a percentage of each sale they make through their reference. The main purpose of affiliate marketing is to create a win-win situation for both the brand and the affiliate partner.

Wrap Up 

Performance marketing is a great way to grow your business and reach new customers. By using relevant keywords and targeting a specific audience, businesses can create ads that are more likely to be seen by people who are interested in what they have to offer. Some top-performing marketing channels include native advertising, affiliate marketing, and search engine marketing. Performance marketing strategy varies from business to business, so it’s important to find what works best for you and your company.


When should you report on your performance marketing campaign?

You should report on your performance marketing campaign at least once a week to track your progress and see what’s working. You can also adjust your strategy based on the results of your reports.

Growth marketing vs performance marketing - what’s the difference?

Growth marketing is a type of marketing that focuses on growing a company’s revenue. Performance marketing, on the other hand, is a type of marketing that focuses on generating leads or sales.

What factors determine marketing performance?

Understanding what is performance marketing also involves understanding the factors that determine its success. Some of these are the number of leads generated, sales revenue, brand awareness, and customer acquisition.


I am curiosity-driven and detail-oriented so you will often find me researching the latest trends, experimenting with search engine optimization, or testing software. As a keen observer of content, my teammates often like to joke that "noting escapes the eye of Beti."

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