Getting your message in front of consumers does wonders to make them aware of your brand. But why pay just to build brand awareness when you could pay for conversion?
This is why an increasing number of companies are turning to performance-based marketing.
Although some of the biggest advertising trends today evolved out of the practice (think email and pay-per-click), performance-based marketing has kept a relatively low profile — until now.
With more consumers shopping online for even the most basic necessities, e-commerce has become a focus for Nestlé, which is why its digital chief says the brand will use performance marketing to enhance its e-commerce initiatives.
Performance-based marketing campaigns are highly targeted, with the actual marketing fee only getting paid after a consumer takes a predetermined action, be that a click or purchase, providing retailers with real-time data that helps them drive ROI.
Who Should I Hire?
Because many retail businesses are unfamiliar with performance-based marketing and must rely on an outside agency for help, marketing executives are often left wondering where to begin.
Look for the following characteristics in a performance-based marketing agency:
- Senior, expert-led account management: Managing a performance-based marketing program effectively often requires specific channel expertise and knowledge that only professionals with proven track records can provide.
Make sure the agency assigns a carefully assembled senior-led team, not junior account staff, to oversee your campaigns.
2. A low client-to-manager ratio: Experience isn’t always enough to ensure success. You also need an agency with enough resources to provide high-touch service and strategy. Look for one with a low client-to-manager ratio.
3. A focus on strategy and thoughtful planning: Successful agencies provide effective insight and high-level service over the long term and day-to-day campaign management. Such agencies take a top-down approach to achieve your brand and marketing goals and are proactive in looking for issues and opportunities before they arise rather simply responding to client requests.
4. Clear core competencies: One person with experience in a particular area doesn’t constitute a core competency for that agency. If that person leaves, what will it mean for your business?
For an agency to deliver results in a given area, it must staff at least three to five professionals who are knowledgeable in that space, one of whom should be at the managerial level.
5. Real thought leadership: You don’t want an agency that just follows the latest trends; you’re looking for one that sets and creates the trends. Forward-thinking agencies are committed to innovation and are thought leaders in the industry.
Some indicators that you’ve found a thought-leading agency include forward-thinking articles published on the agency’s website, guest-contributed content on external sites, a prominent social media presence and speaking engagements at industry events and conferences.
6. Expertise in your domain: An effective performance marketing agency understands your needs and industry inside and out. By diving deep to learn your business and brand focus, it can align its strategy with your marketing goals for the best possible results.
7. Financial transparency and aligned incentives: Most agencies still charge clients a percentage of spend, which motivates them to continue spending your money, regardless of profitability. Flat-fee or return-on-ad-spend revenue models are better options to keep costs down and ensure the agency focuses on increasing your profits.
This way, you know where your money is going and that your agency isn’t spending more than it needs to just to pad its own bottom line.
Good performance-based marketing agencies stay true to your brand by aligning their strategy with your marketing goals. They help you find ways to acquire more customers through programs that drive the best ROI, as virtually every channel they work on has a clear connection between spend and revenue.
Learn more about Acceleration Partners’ approach to performance-based marketing partnerships on our Company page.
This article was originally published on targetmarketingmag.com.