Performance marketing
Advertising
Advertising
Performance marketing is marketing steered on measurable results: cost per request, cost per sale or return on ad spend, rather than reach alone.
It mostly involves channels you can adjust quickly: search ads, social ads, shopping, affiliate and remarketing. You measure what a campaign returns, compare it to what you spend and shift budget to what works.
It depends entirely on accurate measurement. Misconfigured conversions, double counting or missing offline sales make every conclusion worthless. Equally important is the margin under a sale: steering on revenue without margin can switch off profitable campaigns.
The trap of this approach is short-term thinking. Channels that create demand rarely score on last click, yet they decide how many people will search for your brand later. A healthy mix combines direct return with build-up.
Tip
Combine budget for immediate conversion with budget that builds demand. That way you get results in both the short and the long term.
Related terms
- ROASROAS is revenue generated by your ads divided by what you spend on them. A ROAS of 4 means €4 revenue per euro spent.
- CPACPA is ad cost per conversion: total spend divided by conversions, such as enquiries or purchases.
- SEASEA is advertising in search engines: you pay to appear for queries, usually per click.
- Conversion trackingConversion tracking makes the actions you care about measurable — an enquiry, purchase, phone call or download — so you know which channels and pages produce them.
- AttributionAttribution assigns the value of a conversion to the channels and touchpoints that preceded it.