What is Performance Based Marketing?

Jess Ailion 29 April 2022
What is Performance Based Marketing?


performance based marketing website insights

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Performance marketing is the practice of using digital advertising to drive measurable results for your business. This type of marketing is effective at getting your brand in front of people who are most likely to be interested in your services and products. Performance marketing can be used in many different areas of your business, including marketing your products, services, and company. 

This article is going to show you how to effectively use performance marketing in your business. We’re going to cover everything from what performance marketing is, the pros and cons of performance marketing, and best practices for implementing performance marketing into your business. Keep reading to learn more about this exciting method of growing your business.


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For more questions, or to speak to expert social media marketers here at Moburst, get in touch.

What is Performance Based Marketing?

Performance based marketing is a type of digital advertising that aims to drive measurable results for your business and accelerate business growth. Measurable results can be sales, leads, app downloads, page clicks, ad impressions, social media engagement, conversions, video views, etc. 

Performance based digital marketing is based solely on results – it requires in-depth measurement of all marketing campaigns. Any decisions are made based entirely on data from these measurements. This allows for continuous and rapid optimization. 

performance marketing objectives vector

Instead of paying a monthly or annual fee for marketing services, a company pays for their marketing efforts when pre-determined metrics, KPIs and objectives are met. The amount of work put in has no bearing on the payment. 

Performance based marketing is designed to attract people through your marketing efforts who are most likely to be interested in your company’s offerings. 

Why Use Performance Marketing?

Brands are now spending more money on performance based digital marketing to get their message in front of more people. The main reason for this is that performance based digital marketing has proven itself to be one of the most effective ways to grow businesses. This can be done by increasing brand awareness, generating traffic, and increasing the number of leads and sales. 

performance marketing acceleration vector

The advantages of performance marketing include being able to take action on the results right away. You’ll know exactly how effective each of your marketing campaigns are and what areas need improvement. You’ll also have data to prove the results of your marketing.

The Pros of Performance Marketing


Continuously measuring campaigns means you can use the acquired data to optimize them on a rolling basis. Every marketer knows that optimization is the key to success. It should form the backbones of every campaign and all strategies, especially performance marketing strategies.  


The continuous measurement allows for reactions to performance on an almost instant basis. If something isn’t working, scrap it. If something is proving successful, try more of it. It allows you to experiment and adjust campaigns according to the data in real time. This also makes performance based marketing low risk, because everything can be adjusted almost instantly. It’s also low risk because every decision is based on accurate data. 


Businesses set their desired targets and the hired agency must help hit them or they won’t get paid. As such, payment is based on delivery and there is little ambiguity in the process. The conditions of the payment are clearly set out before the work begins. This can lead to increased motivation and efficiency in addition to transparency. 


Your budget is directed into specific places and campaigns so that you can be targeted with your money. This allows you to be sure it’s reaping the rewards you’re after. You can measure various KPIs, e.g. Cost Per Click, Return on Investment, or App Retention Rate, to help you determine where to target your budget in the future. 

targeting vector

Increased Traffic, Leads and Sales 

The main reason brands are switching to performance marketing is to generate more traffic, leads and sales. This can be done by advertising to people who are interested in your products or services. By closely monitoring your digital campaigns, you can determine which areas need improvement to increase your conversion rate. We have more about Conversion Rate Optimization (CRO) here.

Performance marketing has proven itself to be one of the most effective ways to grow businesses. 


The whole point of performance based marketing revolves around measurement, which means everything is clear and easy to scale and evaluate. If you’re running an app, you can easily track app downloads and figure out which marketing strategies are working for you. That’s just one small example of how you can optimize the entire marketing funnel based on real-time data. 

measurable insight charts

Granular Insights 

The insights you can gain from this marketing method are invaluable given the in-depth analysis applied to every vertical. You’ll learn more about your brand, your customers, your objectives, your most and least successful marketing strategies and more. You can even get deep into the nitty gritty with data insights on specific ads, link clicks, drop-off points and more. All of these insights should go towards your future digital marketing strategy and allow you to make data-driven decisions. 

The Cons of Performance Marketing

Increased Costs  

Performance marketing does come with a cost, especially if your targets are continuously met with speed and you have to keep upping what you pay for it. That’s because you pay for performance marketing based on targets being met.

Of course, it’s amazing to hit all of your KPIs in as short a time as possible, but sometimes it can be more cost efficient to hire an agency to conduct your marketing efforts on a fixed contract basis. 


Latency is the amount of time it takes a digital ad to be seen by a viewer. It’s usually measured in seconds. If a viewer goes to another page while a digital ad or mobile ad is loading in the background, the viewer will never see it. You’ve lost out on that exposure and there’s not much you can do about it. 

Time to Impact 

The time it takes for performance marketing to make a difference is usually measured in weeks. This is because it takes time for digital ads or mobile ads to be seen, for viewers to load them, and for the consequent results to appear.

Long-Term Goal Neglection

The immediate access to data-driven results in performance marketing can cause you to focus too much on short-term goals and neglect your long-term goals. It’s easy to get sucked into monitoring real-time KPI increases in-depth, such as impressions or clicks, without keeping your eye on the wider marketing funnel and long-term goals.

It’s possible to lose sight of your broader business objectives, despite how quickly you’re hitting short-term goals. These short-term goals don’t always help your strategy if you don’t keep them on track. 

Best Practices for Performance Marketing


You need to have a clear vision of how you want your business to grow. Once you have this vision, you can begin to look at what steps you need to take to get there. That’s how you begin your brand performance marketing journey.

Set Measurable Business Goals  

Similar to forecasting, setting measurable goals is the best way to determine if performance marketing is right for your business. Especially when business goals are the backbone of all performance marketing strategies and steer it in the right direction. 

Goals act as the parameters by which you can determine if your performance based marketing strategy is successful. It’s important to remember to set a timeline to your goals so that you know by which points you expect to be hitting them. 

Monitor Results

Once you’ve set your goals, you’ve got to keep track of whether they’re being met by monitoring the results. Through monitoring, you can ensure that all of your future decisions are data driven. Since those decisions will be based on tangible data, they’re far more likely to be successful than decisions made on a whim. 

Monitoring your results means you’ll never miss if something is failing, you can instead try and turn it around. Equally, you’ll never miss if something is seeing immense success, you can invest more into this campaign. 

There are countless tools out there to help with monitoring performance marketing campaigns, such as Google Analytics and HubSpot.

data graphs vector

Be Flexible and Consistent

This is also important because not all of your digital ad campaigns will deliver the results you want. However, when you’re consistent with how you handle the results of your digital campaigns you’ll likely begin to see the results that you want. 


Recognize which campaigns are being successful and which are not so that you can optimize by going forward only with the best tactics. The data you receive from each campaign should inform your future strategy for a fully optimized funnel. 

Choose a Trusted Performance Based Marketing Agency

Often, businesses enlist the help of an agency to run their marketing campaigns. This is the most common practice within performance based marketing. There’s a lot of trust required to ensure your business’s needs are met. 

How can you choose a trusted performance based marketing agency? You can:

  • Check out client reviews on third party sites like G2. 
  • Check out their website to see their portfolio of work and past clients. 
  • Define your goals and make sure the agency aligns with them. Do they have the past experience or capability to help you hit them?
  • Ask questions to make sure they’re the right fit for your company. 

Final Words: Is Performance Marketing Right for Your Business?

performance marketing benefits

If you’re interested in trying performance marketing, there are a few things you should keep in mind. First, see if your current advertising budget can be used to fund your performance marketing campaigns. If not, you might need to find a new budget to use for these campaigns. 

Next, make sure your advertising is pulling in enough unique visitors to be effective. It’s important that your digital campaigns aren’t saturating the internet with ads. If they aren’t bringing in enough unique visitors, performance marketing might not be effective.  

Finally, make sure your digital ads are tailored to your ideal customer. This will ensure that your digital ads are bringing in the right people and converting them into customers.


Jess Ailion
Jess is Moburst's Content Marketing Manager who came to us all the way from the UK. After studying English Literature, she found herself writing about all things mobile marketing. When she's not spending her time writing, you can find her cooking for her friends or exploring new places.
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