What is Performance Marketing and How Can it Transform Your Business?

by | Nov 14, 2022

Tired of wasting money on marketing strategies that don’t drive results? 

Instead of running your marketing budget dry with minimal return, you need a marketing strategy that can combine brand marketing and paid advertising to bring you a measurable ROI in a matter of months.

You need performance marketing.

Table of Contents:

  1. What is Performance Marketing?
  2. Benefits of Performance Marketing
  3. How to Measure Performance Marketing?
  4. Performance Marketing Channels
  5. Why is Performance Marketing Important Now?
  6. What to Look for in a Performance Marketing Agency
  7. Conclusion

What is Performance Marketing?

Performance marketing is a strategy in which online marketing and advertising programs are focused on and driven by a specific action. This action can be anything from a sale to a lead to a click, or anything else in between. Unlike traditional brand marketing, which is focused on building relationships with customers over a long period of time, performance marketing is a short-term strategy that pinpoints certain goals and hyper-focuses on achieving them. 

Some performance marketing agencies charge a commission or referral fee for each lead, while others charge on a traditional percent-of-media-spend model while still focusing on the conversion objective.

If a digital marketing channel has a clear conversion action it’s trying to get its visitors to take, then it’s engaging in performance marketing.

Benefits of Performance Marketing

So what is performance marketing going to accomplish for your business? Plenty. Performance marketing is beneficial because it tracks advertising performance, improves targeting, saves costs, and generates valuable insights about your campaigns. 

Let’s break those down:

Trackable Performance

Advertisers and affiliates use entirely trackable, transparent systems, making it easy to see how your campaigns are doing in real time.  This gives you the ability to pinpoint problem areas and adjust your campaigns quickly and efficiently.

Better Advertising

Because performance marketers have very specific desired results, it allows for more targeted advertising. This means you can target specific audiences with tailored messages that are more likely to grab their attention.

Cost-Effective Budgeting

Since you’re paying for results, performance marketers are always measuring and adjusting your campaigns to get a better return on investment, resulting in better use of your advertising budget.

Valuable Insights

Performance marketing provides valuable insights into customer behavior and preferences by clearly showing which customers take action or convert and which don’t. This data can be used to inform future campaigns, help with A/B testing, and even assist with product development. 

How to Measure Performance Marketing?

Analyzing your marketing data can provide you with valuable insights into your performance marketing campaigns, letting you make more informed decisions. Here are some of the most popular key performance indicators (KPIs) to measure in performance marketing: 

Cost Per Conversion 

This is the amount of money you pay to achieve a conversion event, such as a customer subscribing to your email list. You calculate this metric by dividing your campaign costs by the number of conversions you generate. 

Cost Per Click (CPC)

This is the amount of money you pay every time someone clicks on one of your ads. Used in pay-per-click (PPC) advertising, CPC lets you know if you’re overspending or underspending on your campaigns.  

Cost Per Mille (CPM)

CPM is the amount of money you pay for 1,000 people to see your ad. This KPI can be effective for measuring brand reach and awareness, letting you see which channels are more effective in reaching your target audience.

Clickthrough Rates (CTR)

CTR is the percentage of people who click on your ad after seeing it. You calculate this metric by dividing the number of clicks your ad receives by the number of impressions it generates. 

Lifetime Value (LTV)

LTV is an estimate of how much money each customer is likely to generate for the business throughout their lifetime as a customer. This is a critical KPI because it helps you determine how much money you can spend converting a customer and still remain profitable. This information allows you to make more informed decisions regarding marketing budget, resource allocation, and more.

Performance Marketing Channels

There are quite a few different channels that run on performance marketing. Your company may use any or even all of them! Here are several of the most common ones: 

  • Search Engine Marketing / Google Ads – With the right specified targeting, search engine marketing (particularly via Google Ads) can produce outstanding results with an excellent measured return on investment (ROI). Google Ads enables you to bid on certain keywords in order for their clickable ads to appear in Google’s search engine results. It’s very scalable, the conversion intent is high, and you can get immediate results.
Results of Google's search results 




  • Social Media Marketing – There are many ways to use social media marketing. Three key examples of this phenomenon are Facebook Ads, LinkedIn Ads, and Google Ads. Through social media marketing, you can leverage each platform to get either your own product or your client’s product to as wide an audience as humanly possible. The numbers below demonstrate  why social media marketing continues to grow at an exponential rate.
  • Search Engine Optimization (SEO)53% of website traffic comes from organic search, meaning that getting your website to rank on the first page of Google is critical. Search Engine Optimization (SEO) is the practice of increasing the quantity and quality of traffic to your website through organic search engine results. This can include (but is not limited to) content creation, earning links, and developing a site easily indexed by search engine bots. Every facet of search engine optimization is absolutely essential to the success of your marketing efforts.
  • Programmatic Advertising – Think banner ads but targeted specifically to users who are likely to be interested in your product.  Using programmatic technology, advertisers are able to serve ads to users based on their interests, demographics, cookie data, and browser activity.

Why is Performance Marketing Important Now?

Having a performance marketing agency that specializes in delivering results is a must because it allows you to get better results at a lower cost. Through the successful usage of analytics, attribution, and channels, marketers can report real results in real time, and take credit for the traffic and sales they drive.


Maximize Your Marketing Potential with Upgrow

Schedule a meeting today and let Upgrow help you achieve your goals through expert performance marketing strategies.

How well does performance marketing work? See some of our case studies for examples of how we’ve achieved client success in driving customer acquisition.

What to Look for in a Performance Marketing Agency

When seeking a performance marketing agency to partner with, here are a few things to look for:

  • Multi-Channel Expertise – Whether it’s affiliate marketing, search engine optimization, high conversion web design, paid advertising, or a combination of the above therein, companies often rely on agencies to deliver results in the form of traffic, leads, and/or sales. Having a holistic background in both marketing strategy and driving performance is a key consideration for the agency you ultimately end up choosing. It’s important to note that even though these channels are distinct, they do not work in silos. Consequently, a trusted partner that can handle all of them and has a track record for complete performance marketing management is a top factor.
  • Brand Protective – Getting quick deliverable results should by no means whatsoever come at the cost of potentially compromising the brand image. Make sure your agency understands your brand and the target customer, and offers advertising services. For example, Gucci could get a substantial increase in quantitative sales by slashing prices or offering deep affiliate commissions; however, the brand image that it cultivated would suffer. Before anything is signed, be sure to know for certain whether or not your marketing agencies understands your brand from the bottom up and can assure you your brand safety because that is how a great performance marketing agency works.

  • Recommendations and Referrals – No single digital marketing agency can do every aspect of the process perfectly well. Therefore, when you need a great referral for web development or UX, you want a well-connected agency that serves more than a decade that can plug you into other performance agencies and consultants.
  • Strategic – Do you want to work with an service digital marketing agency that runs all of their client’s accounts the same or one that will think beyond the Adwords interface and identify opportunities strategically. A good performance marketing agency services include recommend landing page conversion improvements, go deep into your analytics, suggests a web development, and find insights and recommend new channels to complement, grow your volume and meet your marketing goals.
  • Client-to-Team Member Ratio – Choosing an agency that handles a limited number of accounts per team member is a good idea because it provides more focus and attention on the clients in question. You don’t want to be an account manager’s fourteenth-ranked account, even if it’s at a discounted rate. Conversely, if an account manager only has one or two small accounts on their docket, then they may not have a lot of experience to work with.


While branding and design agency partners can help your business gain awareness, performance marketing agencies can deliver results fast driving online growth both in the present, in the immediate short-term, and the overall long-term periods with their creative services. Whether it is a leading performance marketing agency or not, bringing on a performance marketing agency that has both multi-channel marketing expertise as well as a holistic background in marketing strategy can significantly improve your marketing results as well as saving time, ad spend, and most importantly delivering high ROI.

If you’re interested in learning more about Upgrow’s performance marketing services, schedule a call with us today!


Performance Marketing Agency FAQs

What are performance marketing agencies?

Performance marketing agencies use digital ads to measure results and gain insights through analytics. The most well-known performance marketing channels include Google Ads, social ads, and content marketing.

What are the types of performance marketing?

The most common types of performance marketing are search engine marketing, social media marketing, native advertising, paid content marketing ads (Google Ads, LinkedIn Ads, Facebook Ads, etc), and other types of paid-for-performance online marketing channels.

What is the difference between performance marketing and traditional advertising?

Performance marketing is focused on measurable results such as leads, sales, or signups. Traditional advertising focuses more on brand awareness and building relationships with customers.

What are the benefits of performance marketing?

Performance marketing allows you to track and measure results in real-time, giving you the ability to adjust your campaigns quickly and efficiently. Performance marketing also allows for more targeted advertising, as you can target specific audiences with tailored messages. Additionally, performance marketing is cost-effective, as it only charges when a conversion occurs. Performance marketing provides valuable insights into customer behavior and preferences which can be used to inform future campaigns. This is why selecting the best agency is critical for your brand.

How does performance marketing help?

Performance marketing helps businesses reach their business goals by providing measurable results and insights into customer behavior. Performance marketing services allows businesses to track and measure results in real-time, giving them the ability to adjust their campaigns quickly and efficiently. It makes it possible to target audiences more precisely with customized advertising campaigns and to potentially work with international clients. Additionally, performance marketing is cost-effective, as it only charges when a conversion occurs.

What does a performance marketing specialist do?

A person that offer performance marketing is responsible for creating and managing campaigns that are designed to generate leads, sales, or signups. They will analyze data from past campaigns to identify areas of improvement and develop strategies to optimize future campaigns. They will also monitor the performance of current campaigns and make adjustments as needed. Performance marketing specialists must have a deep understanding of digital marketing channels such as Google Ads, Amazon Advertising, social media ads , and content marketing.

Is performance marketing paid?

Yes, performance marketing is paid. Performance marketing companies use digital ads to measure results and gain insights through analytics. The most well-known performance marketing channels include Google Ads, social ads, and content marketing, these channels are typically paid for on a cost-per-click (CPC) or cost-per-action (CPA) basis, meaning that the advertiser only pays when a desired action is completed.

How to Choose a Performance Marketing Agency?

Choosing the right performance marketing company is essential for achieving your desired results. When selecting an agency, it’s important to consider their experience and track record in the industry, as well as their ability to provide insights into customer behavior and preferences. Additionally, you should look for an agency that has a proven track record of success with campaigns similar to yours. It’s also important to make sure that they have the resources and expertise necessary to manage your campaigns effectively. Finally, you should ensure that the agency is transparent and provides regular updates on the progress of the online advertising.

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Ryder Meehan

Ryder Meehan

Ryder has been on a 16-year journey to master digital marketing from every aspect. His resume includes Razorfish, Slighshot, Fossil, Samsung Mobile and Tatcha before launching Upgrow. Ryder is the acting CEO, heading business development and account services. He has been featured as a digital marketing leader on Forbes, PRNews, Business.com, Workamajig, Databox, Fit Small Biz and other outlets.

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