The term “performance” says it all. Performance marketing is a trick of paying out sales agents or a team of marketers based upon their performance, which is directly linked with how efficient they sell the merchants’ products.
An example of performance marketing
- I am an affiliate of a certain pet dog food program.
- Product Price = $25.00
- My commission = $5.00 per product FOR every customer who comes THROUGH my reference and PURCHASES the product.
- Products I sold out = 10.
- Performance-based marketing awards I get = $5.00 x 10 = $50.00
- The more effort I inject, the better I get paid.
Performance marketing - a vital and growing part of online marketing
Performance marketing has become a vital, and emerging tool of online marketing. It is a performance based business model where both website publishers and merchant partners earn when the product/service is sold via an affiliate network. The business model is simple to understand. The publisher drives targeted traffic using white HAT, ethical SEO techniques to the merchants’ website. The customer then purchases the product through the referral link and the referrer (website publisher) gets his/her share of the commission as revenue.
Performance marketing is better than affiliate marketing
Over the course of few years, affiliate marketing has grown to a whole new level, in which performance marketing has taken over it. In the past, merchants used to pay website publishers for leads or referrals. Today, the process is complete based upon performance, and linked with completed transactions only. A network of websites is built for the merchant to sell his/her product/service online. Whenever that product/service is sold, then only the website publishers get the revenue.
Quality is important than quantity, drive targeted traffic
As a result it has become important than ever to implement quality at every stage of marketing. In order to convince the customer, it is imperative to provide him/her with valuable guidelines and advise on how the product/service being promoted, can help to solve the customer’s problems. It is therefore, vital to drive quality targeted traffic using ethical search engine marketing strategies. Google has started to hunt down on affiliate networks and e-commerce sites due to their history of poor reputation and blatant promotional pitch of selling a product.