Marketing strategies can be so fancy and promising until its showtime. The fact that a marketing company promises an increase in revenue isn’t a guarantee that they might get it done.
We have seen cases of marketing campaigns gone wrong, high marketing spends with negligible ROI.
And for this reason, companies would choose to pay for results and not for a nice strategy or platform.
This is where performance marketing comes in.
Performance marketing helps remove elements of doubts from companies when running a paid marketing campaign or outsourcing their marketing to third-party companies.
It makes it easy to see what is working and also help companies to cut their marketing budget while getting a good ROI on their marketing spends.
What is Performance Marketing?
Performance marketing is a term that refers to marketing programs and activities upon which companies only pay advertisers and marketing companies when a set action is completed which can be anything from clicks to sales.
For instance, if your set goal is to get clicks, whenever people click on your ads, you are charged. The number of clicks determines the cost of your marketing campaign.
The most popular type of performance marketing is Pay-Per-Click advertising known as PPC advertising.
PPC advertising is a paid ads program that requires you to pay per click you get on your set URL.
Google is the biggest advertising company when it comes to PPC advertising.
But besides Google and Facebook, there are many more ways performance marketing can be implemented.
There are agencies that allow you to pay only when you get your desired goal. You only get to pay them per the performance of their marketing.
But it goes beyond that too. A freelancer who only charges you per each link he builts to your company website can also be referred to as performance marketing.
Types of Performance Marketing
As said earlier, performance marketing goes beyond just PPC advertising.
Here are the common forms performance marketing can exist:
- Paid advertising
- Social media marketing
- Native advertising and sponsored content
- Affiliate marketing
On this note, let’s get into the stats about performance marketing.
General Performance Marketing Statistics
1. Millions of Companies are adopting Performance Marketing
There are no definite statistics to give a precise number of companies adopting performance marketing.
However, statistics have it that the number of advertisers using PPC advertising is increasing, and surpassed 7 million advertisers.
In fact, the PPC advertising spend is forecasted to be up to $132 billion by 2022 which only confirms the fast growth of PPC advertising.
Another stat says that 81% of advertisers in the US are using affiliate marketing.
2. Performance Marketing is a Multi-Billion Dollars Industry
The $132 billion dollars PPC ad spend forecasted by 2022 is enough data to show that performance marketing is a billion dollars industry.
But it goes beyond that as performance marketing mothers various marketing like affiliate marketing (another billion dollars industry), native advertising, etc.
If affiliate marketing and PPC advertising are doing well, then it is enough reason to say that performance marketing is a booming industry.
3. Ad Networks will continue to buy up CDPs
CDPs (customer data platforms) are platforms that provide detailed information about customers.
In order to reach the right audience and customer, ad networks like Google ads and Facebook will continue to get data from managed data platforms.
PPC Performance Marketing Trends
- $2 for every $1 spent is how much businesses make on PPC
- 80% of marketers now allocate at least some ad budget to search, social, display, and remarketing ads.
- 65% of small to mid-sized businesses have a PPC campaign.
- 32% of companies use PPC to sell products directly to consumers
- 42% of all digital marketing spending is search marketing.
- 46% of all clicks go to the top three pay-per-click (PPC) ads.
- 85% of total digital display ad spending in 2020 is projected to be programmatic advertising.