Topic: Performance Marketing

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Purpose of this Document Dear Student, The sole purpose of this document is to help you in organizing your thoughts & knowledge for the

upcoming CSFA-Foundation level exam and also for your placements in near future. We have discussed

with many of our friends who are regularly visiting campuses across nation for hiring students from MBA

colleges as to what they look in the candidate when they are hiring for sales or marketing profile and

keeping in mind the finer details pointed out by them we have shortlisted various topics which an

interviewer feels that the potential candidate should know thoroughly.

We have covered few important contemporary topics in brief which a student studying or is interested in

marketing should know. Also we have shortlisted topics here, which will help you in covering your

syllabus for CSFA-Foundation level as well as for your marketing interviews. These topics are in addition

to the study materials, which have been earlier provided by Team Mercadeo for your learning purpose.

We hope that CSFA will help you in preparing for your future ordeals in a more confident way and you

make a good name for yourself in the field chosen by you.

All the best Cheers Team Mercadeo

Performance Marketing

Performance marketing refers to marketing techniques and campaigns by which the advertiser pays only

for results. Performance marketing is an important part of digital marketing due to the tracking

capabilities of the Internet.

In performance marketing context, publishers or ad networks remuneration may be based upon:

- Cost per action or CPA ( any action agreed by publisher and advertiser)

- Cost per sale or CPS (flat fee or sales commission)

- Cost per lead (often based on filled webforms)

- Cost per click

- Cost per phone call

- Cost per download or install (game and software industries)

In the case of cost per mille/click, the publisher is not concerned about a visitor being a member of the

audience that the advertiser tries to attract and is able to convert, because at this point the publisher has

already earned his commission. This leaves the greater, and, in case of cost per mille, the full risk and loss

(if the visitor can not be converted) to the advertiser.

Cost per action/sale methods require that referred visitors do more than visit the advertiser's website

before the affiliate receives commission. The advertiser must convert that visitor first. It is in the best

interest for the affiliate to send the most closely targeted traffic to the advertiser as possible to increase

the chance of a conversion. The risk and loss is shared between the affiliate and the advertiser.

Performance marketing also called "Affiliate marketing", in reference to how sales employees are

typically being compensated. Such employees are typically paid a commission for each sale they close,

and sometimes are paid performance incentives for exceeding objectives. Affiliates are not employed by

the advertiser whose products or services they promote, but the compensation models applied to affiliate

marketing are very similar to the ones used for people in the advertisers' internal sales department.

The phrase, "Affiliates are an extended sales force for your business", which is often used to explain

affiliate marketing, is not completely accurate. The primary difference between the two is that affiliate

marketers provide little if any influence on a possible prospect in the conversion process once that

prospect is directed to the advertiser's website. The sales team of the advertiser, however, does have the

control and influence up to the point where the prospect signs the contract or completes the purchase.

The main performance marketing techniques used in digital marketing are:

- Affiliate programs

- PPC search engine platforms (Adwords)

- PPC ad networks

- Retargeting

- Price comparators

Multi-tier programs

Some advertisers offer multi-tier programs that distribute commission into a hierarchical referral

network of sign-ups and sub-partners. In practical terms, publisher "A" signs up to the program with an

advertiser and gets rewarded for the agreed activity conducted by a referred visitor. If publisher "A"

attracts publishers "B" and "C" to sign up for the same program using his sign-up code, all future

activities performed by publishers "B" and "C" will result in additional commission (at a lower rate) for

publisher "A".

Two-tier programs exist in the minority of affiliate programs; most are simply one-tier. Referral

programs beyond two-tier resemble multi-level marketing (MLM) or network marketing but are

different: Multi-level marketing (MLM) or network marketing associations tend to have more complex

commission requirements/qualifications than standard affiliate programs

Reference Link backs: http://performinsider.com/2011/09/what-is-performance-marketing/ http://en.wikipedia.org/wiki/Affiliate_marketing http://en.wikipedia.org/wiki/Performance-based_marketing http://www.bostonmediadomain.com/performance-marketing/ i DISCLAIMER This content in not a copyright of Mercadeo Education we have just tried to accumulate the data from various sources and put them together for the CSFA classroom. We have placed all the references from where the content has been sourced.