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Performance Marketing: What It Is? And How Does It Work?

With the global pandemic shutting most of the businesses down, the ones that are still thriving are in a storm of extreme competition in the market. The existing businesses are competing to get the attention of their potential customers. And they are using all their resources to achieve their goal of breaking through the market and reaching their customers.

One of the ways that most businesses are using includes performance marketing. Performance marketing comes under the broad term of digital marketing as it uses digital channels to promote the business and its services. 

But performance marketing differs from your regular SEO digital marketing. Performance marketing, yes, you guessed it right, depends on the performance of the advertisements and online marketing content. You will only pay for the advertisements in Singapore when a specific action occurs. These actions include click, lead generation, sales, and more. 

Performance marketing relies on several paid online marketing channels such as sponsored advertising, native advertising, affiliate marketing, and more. We will discuss these marketing channels in our subsequent blog posts. However, in this blog post, let’s start with the basics.

How does Performance Marketing work?

So, as mentioned above, performance marketing relies on several online media channels. And these media channels display the ads on their platform to the audience. For example:

  • Facebook, one of the biggest social media platforms, provides the option of Facebook advertising Singapore where the ads are shown to their users. 
  • YouTube is another social media platform that offers the option of YouTube ads that are shown to the audience during the video. 
  • Google also shows your ads during the search results and in the Google Ads network.

Now, you might think that these social media channels display all the ads to all their users. Well, that’s where several factors come into play determining which ad is shown to whom.

  • Audience Segmentation: These social media channels provide you with the option of choosing your target audience and segment them as per your needs. You can segment them based on location, age, gender, and more such factors. 
  • Quality and Relevance: Most of these media channels emphasize the quality and relevance of the ads. If the ad quality is low, the media channel will reduce the circulation of your ads on the platform. In fact, Facebook has already introduced a tool in 2019 called, Facebook customer feedback score that determines the ability of a page to advertise on the platform. 
  • Bid: Performance marketing always factors in the amount your business agrees to pay for displaying your ad at a specific time, location, and target audience. 
  • Conversion: Performance marketing economics depends on the consumer taking an action. So, if a consumer takes an action, the media channels get paid. So, if your ad campaign works, the media channel gets paid more, in turn, increasing the display of your ads on the network.

Most media channels work based on the above factors. And at Hyper Fame Digital, we are determined to bring you results from your performance marketing campaign. 

We are amongst the leading performance marketing and advertising agency in Singapore that works on boosting your business revenue and increase your ROI by 3-5x. Our dedicated team of performance marketing professionals will come up with the best strategy to promote your ads on these media channels. 

So, contact us to know more about our performance marketing campaigns tailor-made for your business!

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