18 February 2013 - 4:22pm | posted by | 0 comments

Performance marketing: how can the value of the performance industry be communicated to clients?

The Drum speaks to individuals from the performance marketing industry to establish how the industry's value can be clearly demonstrated to clients.

Performance marketing: how can the value of the performance industry be communicated to clients?Performance marketing: how can the value of the performance industry

The Internet Advertising Bureau (IAB) report into the value of performance marketing, published in January, highlighted for the first time the previously hidden value of performance based marketing channels.

As part of its recent Performance supplement, The Drum caught up with members of the industry to discuss how this value can be conveyed to clients and ultimately encourage buy-in.

Matt Swan, client strategist, Affiliate Window
As a channel we have done a lot of work around the value that is delivered by affiliate marketing which is absolutely critical. There is still an absence of general insight offered by individual digital channels and whilst we cannot necessarily access wider data, we need to act as a conduit for it.

We’ve carried out significant data projects with a number of clients looking at the incremental nature of various sectors such as cashback or voucher coding. Only by doing more of this can we secure extra market share. Additionally reports such as the IAB/PWC case study give us a great opportunity to shout about the overall channel. We’ve also committed to showcasing more of our clients’ successes in 2013 through white papers and case studies.

Matt Brown, sales director, Affiliate Traction UK
Across the board, bodies like the IAB and media platforms like Econsultancy do a fantastic job in promoting the performance sector. However, some cross-pollination amongst other digital sectors would assist with our positioning enormously. 

Together with the trade press, the industry embraces performance and its place in the digital space now, yet the work we do as agencies is equally valuable, because we are constantly justifying the sector, both through case studies, and as part of the sales process.

Matthew Stannard, chief technology officer, 4Ps Marketing
In the marketing world, the amount of data that companies are able to collect and measure is growing by the day. Visits, page views, e-commerce data, social interactions, events and goals are all things that Google Analytics users are familiar with. Out of the box, Google Analytics provides some very powerful reporting functionality but it is simply a snapshot of what is happening. It provides the “measure” and “report” but not the “analyse” and “optimise”. This is where the performance industry adds to its value.

The performance industry helps show which channels are effective and when, helps segment and create audience cohorts and shows how different channels affect success. Value can be shown through improved conversion rates, money saved by stopping ineffective activity or by finding new audiences to reach.

Dorothea von Wichert-Nick, CEO, affilinet
I believe performance marketing is really starting to speak for itself. In the past the focus was predominantly on creating volume: more sales, more leads, more traffic... instead, our business and our clients are now focusing on generating the right sales and delivering sustainable growth based on incremental revenue. As a result performance marketing is becoming an increasingly important part of the entire marketing mix and is starting to gain recognition higher up in the business. That is where the industry needs to focus its attention.

Alex Cornford, director of sales and client development, Rakuten LinkShare
According to PWC and the IAB, British advertisers spent £800m on online performance marketing last year but generated £9bn in sales. How can we more clearly communicate the value and the huge ROI that the channel can produce? This is echoed in our own network as some brands saw a 35 per cent increase in sales in Q4. Furthermore, the quality of publishers in the channel, the types of brands now engaging with performance marketing and the tailored campaigns that can be created mean that clients can see the limitless potential sales in CPA (Cost Per Acquisition). Performance marketing is becoming more and more diverse, with voucher sites and bloggers, as well as mobile apps and dynamic ads.

Dan Cohen, regional director, Tradedoubler
Recent research from the IAB and PwC found that marketing’s ‘best-kept secret’ – performance marketing – is generating £11 of revenue for every £1 invested and is contributing to a massive £9bn in sales in the UK alone. This proves the undeniable development of this previously ‘hidden industry’ and enables affiliates to quantify their investments. Interaction with clients, through workshops and at events, is key to helping them understand the value and development of Online Performance Marketing. Affiliate networks need to shout louder about the successes they are achieving on behalf of their clients, and work to educate advertisers on the power of performance marketing.

The first of The Drum's quarterly Performance supplements was published 15 February. Subscribers can download a copy here.

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