Do you like the idea of being paid by performance? In this Expert Insight Interview, David Stellato discusses performance marketing. David Stellato is a Chief Growth Officer at DFO Global Performance Commerce, a performance marketing agency.
The interview discusses:
- Tracking and attribution with performance marketing
- Experimenting as part of the process
- Surprises and misconceptions about performance marketing
Tracking and Attribution
The essence of performance marketing is to drive measurable results. CPA (cost per acquisition) and CPL (cost per lead) are models used in performance marketing, which can easily show which campaigns drive profit and which not. Many things in marketing do not offer proper tracking and attribution. For example, if you put a billboard on the street, you will never know how many people have seen it or bought that product. On the contrary, performance marketing is trackable due to digital media. After posting an ad, you can track how many people clicked on it and whether they clicked it through desktop or cellphone. You can even trace whether they used an app or social media for it. Moreover, once they land on the page, you can track whether they followed through and made the purchase or not. It is also possible to see exactly where you lost a customer, which allows you to optimize it accordingly.
Experimentation is a big part of performance marketing because it shows what brings results and what does not. Sometimes, the reason why customers do not follow through with the purchase is a thing that we would never think of on our own. Experimenting does not mean wasting money because every new thing learned is a valuable lesson for the future. These insights are of great help for decision-makers when they decide on scaling the business.
Surprises and Misconceptions
The thing that almost always surprises people about performance marketing is how quickly yet significantly it can drive business success. People who used it for selling on Amazon experienced a jump in their sales from selling around 20 items to selling above 1000 daily. The sales were rising gradually and with the right offers and media buyers, the profits maximized.
On the other hand, one of the misconceptions of performance marketing is that it can work for any product. A product needs to be meaningful, for everyday use, and to solve problems for the masses. However, if you still want to sell some high-end item, you will have to strategize. For example, people who love to drink wine primarily need a corkscrew and wine glasses. But, maybe some of them would want a wine fridge too. So, start with promoting the corkscrew and wine glasses, and then slowly introduce your audience to the expensive wine fridge.
John is the Amazon bestselling author of Winning the Battle for Sales: Lessons on Closing Every Deal from the World’s Greatest Military Victories and Social Upheaval: How to Win at Social Selling. A globally acknowledged Sales & Marketing thought leader, speaker, and strategist. He is CSMO at Pipeliner CRM. In his spare time, John is an avid Martial Artist.