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LATEST NEWS / 04 - 05 - 2020
What is performance based advertising?
When was the last time you truly looked at a billboard? What about an advert on the side of a bus? Traditional advertising methods are steadily losing popularity, and for a good reason - everything is online now. Any business that wants to grow and reach new customers should be looking towards the future of digital advertising and marketing:  performance-based advertising.
What is performance based advertising?

The New Way to Market Your Business

But how can performance-based online advertising really help your business? 

What You Need to Know About Performance-Based Advertising

There are two approaches in digital marketing. 

In the first, you throw your adverts out there and hope that something works. While you may get a few leads, you’ll never know if it was from your ads or if they found your business on their own - and if it was from an ad, which one? This kind of information is vital because you may be spending unnecessarily, and you wouldn’t even know it. If you’re a small to medium-sized enterprise, you’ll probably want to avoid overspending. 

The other approach has to do with performance. Performance-based advertising focuses more on achieving specific, measurable results in a shorter time. While regular digital advertising works, it’s more difficult to know exactly where things are falling short. In turn, this then makes it harder to implement deliberate changes to improve your campaigns. 

Performance-based advertising breaks things down so you can see which channels and approaches work, and which don’t. You can then focus your energy and budget on the high impact areas. By setting up measurable end-goals, such as boosting sales, generating leads, retaining an audience, or increasing ROI, you can track how well your advertising is doing. 

You only pay when your campaign delivers results. 


What Does Performance Advertising Look At? 

For performance-based advertising, consumer actions and reactions are important. The actions you’ll want to focus on include:


Impressions are basically eyes on your ads. It’s the views you get from your campaign. Impressions are a great way to build brand awareness.

Something that plagues many businesses is haphazard digital advertising, especially in the time of the advert blocking ad-on. Some advertising agencies, and even Google AdWords, will still count blocked views as part of the total, even though they can’t verify that the ad was actually seen by the audience. So, businesses end up paying for something that they aren’t sure is effective. While this predominantly affects your impression total, your conversion rate calculation can also be skewed low. 

Looking at impressions or views alone, statistics show that you could be overspending on ads by up to 11% because of ad blockers. This percentage is increasing yearly. Thankfully, the Google Display Network no longer charges by impressions. In fact, most PPC providers have started to change things, so you’ll still count impressions towards your total, but you won’t be paying for the missed click from the blocked ads.


Pay per click campaigns focus on the action of the viewer clicking on your ad or your link. This is a fairly popular tracking method because it’s easy to analyse the numbers.  You’d use CPC bidding if you are trying to direct viewers to your website or a landing page. CPC campaigns are a great option for businesses that are focusing on optimisation and growing an audience. 


Engagement campaigns are a bit of a mix of everything. They involve any engagement a viewer has with your ad. While engagement is important for marketing and brand awareness, bidding for a campaign with this type of action won’t help much in terms of performance-based advertising. 

Because you are paying for whatever action the viewer takes with your ad, you may end up paying for engagements that lead nowhere. Or worse, you may be paying for negative engagements. 


Cost per lead campaigns are there to help you get more leads. This type of campaign is a bit more advanced because you need to have some idea of what a lead is worth to your business. It is an ideal bidding strategy for those who sell subscriptions or high-value products. It may be better to look at CPL campaigns once you have a better understanding of what a lead is worth to your business


Cost per acquisition campaigns are devised to help boost your acquisitions and sales. Again, this is a more advanced bidding strategy to take because it requires you to have more information about your business. 

For this strategy, you’ll ideally already know what an acquisition is worth to you. This would be something to look at further down the line, once you’ve established a successful performance advertising campaign in other bidding areas and you want to move towards increasing sales. 

Which Should I Choose?

The action you choose will depend on which stage of the buyer’s journey you want the campaign to focus on. 

If you’re aiming for business awareness, go for a CPM campaign, which calculates cost per 1000 impressions. If you want to trigger a response or get your viewer to your landing page, use clicks (CPC). Cost per lead (CPL) campaigns focus on audiences in the ‘considering’ phase, with the goal to get them to sign up for something or to submit information in some way. Ultimately, everyone wants their ads to lead to a sale but, if that is your specific goal from the outset, you should be investing in cost per acquisition (CPA) campaigns.


Reasons to Consider Performance-Based Advertising 

Performance-based advertising can give you measurable results, such as clicks on ads, leads, ad impressions, and sales on your website. But why is it better than regular digital, or even non-digital advertising?

  • It’s faster than you expect.
    The great thing about performance advertising is that you can see results fairly quickly. In fact, you should be able to start making changes from about three weeks. So if, for example, your click through rate is low, you know that your campaign needs to be changed to see better performance. 

  • It’s possible with a modest budget.
    Because you only pay for the campaigns that get results, you won’t be wasting your budget on uncertain advertising. You actually get what you pay for.

  • It’s scalable.
    As an SME, you may only want to start with a small advertising effort. With performance-based advertising, you can make changes to, grow, or shrink your online advertising at any time - no strings attached. Wizard offers a new Scale Up service specifically catered to SMEs. It can help you feel like a million-dollar brand, with a million-dollar advertising budget - without actually having to expand your budget at all.

  • It’s fully transparent. 
    With performance-based advertising, you can see the keywords that are being targeted, the audiences that have seen your ads, and the number of times they were viewed and clicked. This gives you more control over your campaign and the ability to choose those areas that work better. 

  • It’s personalised and relevant to your business.
    With the control provided by performance-based advertising, you can tailor your advertising efforts to suit your audience and your business goals. For example, you can use social media platforms to target users of a specific age, gender, or location to see your campaign. Social media platforms and Google AdWords have such detailed targeting methods that you could even set the parameters to target ads to one individual person. While it would be more beneficial to target a larger group, it just goes to show that you can clearly define who you want to see your campaign and who you don’t. 

  • It’s easy to measure the results.
    By setting advertising goals according to your business objectives, you’ll be able to see how well your campaign performs. So, if you run a catering business, for example, you can track how many of your sales come from social media versus your website, and how much it cost you. The main goal is for your advertising to bring a profit, so you can use collected data to optimise the areas of your campaign that work for you.


How Do I Make Performance-Based Advertising Work?

Getting started with your performance-based advertising campaign is easier than you think. With a bit of planning and creativity, you will see results.


  1. Start with Research
    Like any good advertising campaign, you’ll need to do some market research before you get started. This is especially true if you don’t have an already established audience like many larger companies. You need to be able to identify the right buyer personas for your business. This will help you further down the line for targeted ads. You’ll need to choose an audience segment, and your research will help you know which segment to focus on.

    Because Wizard offers a holistic approach to performance advertising, we are able to do a full business audit and marketing review that will help you to understand your current marketing position. This research helps you to hone in on the right campaign choice for your audience. 

  2. Develop Your Brand’s Distinctive Concept
    Wizard also develops your brand’s distinctive concept as part of our advertising services. By using creative concept, design, and video implementation, we can help your entire marketing plan take shape. Once the concept is in place, our team of performance marketers can put it into action by choosing the best possible platform for your campaign. We are also able to do all the copywriting, social media posts, video design and editing, audiovisual, and banner work for your campaigns.  

  3. Set Goals and Build an Action-Plan
    Plan your destination before you start your journey. You should look into where you want to begin and how you want to reach your end goal. This has to do with choosing the right bidding strategy. If your end goal is to drive more traffic to your website, you’ll want to focus on a CPC campaign as opposed to a CPM campaign. Once you know that you want to focus on clicks, you can develop an action plan of how to get more clicks from your audience. To do this you’ll need to establish the right platform for your campaign.

    You also need to choose the right type of ad, depending on the bid you’re going for. If you use Google AdWords, for example, you may use Search, Display, or Video ads. Depending on your desired outcome, you could use a combination. Again, you need to make the choice in alignment with your research because your conversion rate calculations can be negatively affected if your choice of ad underperforms.

    Wizard specialises in marketing and media planning; performance marketing and optimisation; and digital marketing consulting and strategy. With us on your side, you’ll be guided from start to finish. 

  4. Establish Your Campaign
    Once your research is done and your action plan is ready, you can start with your campaign. This is where you truly begin to see results. In order to run your campaign effectively, you need to:

  • Stick closely to the action plan but allow for revising, especially if the type of ad or the platform you’ve chosen isn’t seeing a positive performance
  • Monitor the campaign and make adjustments where needed, to ensure the budget is used properly. 
  • Replace weak advertising tools with stronger ones, so you can get the most out of your campaign

    Wizard believes that one budget should fit all your advertising needs. We use your return on investment as a key performance indicator to increase the sales and awareness of your business. Our purpose is to help SMEs advertise on the scale of ‘big brands.’ By combining brand awareness and increasing sales, we will help your business reach new heights. 

So, what is performance-based advertising?

Ultimately, it’s the best chance your business has at making a success of online advertising. It saves you time, money, and gives you proper results. Optimising your marketing strategy has never been easier, so now’s the time to go for it.

Alexandros Kokolis Avatar
Alexandros Kokolis
04 - 05 - 2020.
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