Performance Marketing? What the hell is this?

Are you still confused if you listen to different people who all knows what “Performance Marketing” is and all talk about different things? Do you think then this is just another buzzword if you hear words like RTB, RTA, Performance Advertising, Programmatic Buying, etc.?

Performance Marketing is nothing new, but it changed with the amount of data and the realtime or near time interaction which is possible now. Let’s have a look at the Gartner hype cycle for digital marketing. This is from July 2015, so now (a year later), everything moved a bit to the right on the curve.

Source 1)https://static.esser.me/2016/08/dm_hype_cyycle_2015.jpg

I assume you are aware of the “Hype Cycle” methodology. This describes the progress of themes and place it into the 5 sections (last one: plateau of productivity).

Have a special look at these points (be aware that this is from July 2015):

  1. Real-Time Marketing
  2. Programmatic Direct Advertising
  3. Data-Driven Marketing
  4. Real-Time Bidding (Advertising)
  5. Online Advertising Data Exchanges

In a few years we do not talk about customer journey or attribution, we will talk about “customer understanding“. This understanding is based on data through all channels, online as well as offline. For sure 100% measurement isn’t possible but it is also not needed.

Based on this understanding we know who needs what and when. So we can tailor advertising and don’t need to place it like we did it in the past, especially with the CMP media-buying model. We don’t annoy user with a high amount of un-needed advertising, we will place less at the right time, the right place and with the right 1:1 message.

What do we need for this? We need data, a very good BI system with predictive modeling (much more then webanalytics today) and a real-time interface to place content and advertising. Digital marketing is for me the right mix out of content and advertising.

There are 2 scenarios possible if we thing about marketing in future:

Scenario A

An advertiser like Samsung for example has a huge amount of user data and can calculate who will buy with a percentage of higher 80% within the next 30 days a new TV.

Knowing this Samsung will go out and buy advertising exactly for this user. To do so he give the identifier (cookie, fingerprint, etc.) to a data exchange who places the advertisement/content only to this user.

Scenario B

Let’s assume Samsung does not have enough data to calculate the above described percentage. In this case he asked data exchanges who can calculate this based on their data to place the advertisement/content to this user.

The big challenge today is to collect data and combine different data-sources to be set for the future of marketing. This is a must if you want to keep staying competitive.  If you look at the 5 points in the chart you will see that it takes time to have all this points at the “plateau of productivity”. At this time using this functionalities is standard and easy to use. The good message is, that you are able to do all these things much much earlier because all the technology is available today. For sure it’s not an out-of-the-box setup, but if you do it you will be highly competitive. If you add also the idea of conversion stages and milestone development into your marketing you can sit down and see your competitors behind you.

Don’t be confused by all the buzz-words like Real-Time Advertising (RTA) and Real-Time Bidding (RTB), Programmatic Advertising / Programmatic Buying or many others. Many people talk about this, describe it, but doesn’t know the difference for example between RTB and RTA… they mix this all the time or put it into the same bucket. Focus on your user / customer and learn to know what they need, switch to their point of view and move away from your company view.

References   [ + ]

1.https://static.esser.me/2016/08/dm_hype_cyycle_2015.jpg

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