It’s no secret that traditional marketing is on the decline. Traditional forms of marketing such as event marketing, print advertising, and TV and radio advertising have been on a downward slope for quite some time – one that has been even further steepened by the coronavirus pandemic.
Over the course of the pandemic, more than 83 million event attendees were required to change their plans. Marketers who were planning to take advantage of those events were forced to move their advertising dollars elsewhere. Likewise, the lack of mass commuters and overall fear of contracting the virus has led to a decrease in newspaper and magazine readership, resulting in a drop in print advertising. The New York Times alone reported a 20.9% decrease in print ad revenue during the coronavirus pandemic.
Though the pandemic has heightened the shift away from traditional marketing, the movement still existed before the coronavirus. As consumers have gravitated towards digital technology, so have marketers. For example, as online video and radio streaming services have increased in popularity, more and more consumers have begun to ditch traditional cable and radio services. In 2018, 69% of homes were subscribed to a video streaming service, with 25% of homes expecting to abandon traditional television entirely by 2022. Not only have television and radio begun to move online, but news and magazine outlets have started that transition as well. In fact, this year the number of minutes spent by readers on digital news sites increased by 46% compared to the previous year.
The bottom line is that consumers are spending more time online and less time offline, contributing to an overall shift away from traditional marketing. This has left the door wide open for a surge in performance marketing.
What is performance marketing?
Performance marketing is simply marketing based on performance – meaning advertisers only pay when a specific desired action is completed. Some examples of performance marketing include pay-per-call, pay-per-click, paid social media, email marketing, search engine marketing (SEM or paid search) and display ads.
Why transition to performance marketing?
In performance marketing, advertisers only pay when a specific desired action is completed. For example, in pay-per-click, the advertiser will pay a set price for each consumer that clicks on their ad. This concept that “you only pay when your ad performs” significantly reduces risk for marketers. Even if a campaign is unsuccessful, the loss is minimal.
One of the key reasons many marketers are shifting ad dollars to performance marketing is because of the helpful campaign insight it provides. Performance marketing methods are primarily digital, enabling marketers to track and optimize their campaigns with ease. Advertisers can track conversion rates and return on investment (ROI), scale and maximize spend on well-performing channels, and have an overall better understanding of the customer journey.
Additionally, technology-enabled targeting gives businesses the ability to target specific geographies and demographics within each campaign, meaning marketers can reach their ideal consumers and see better ad performance.
The key benefits of performance marketing are clear: easy campaign tracking and optimization, technology-enabled targeting, lower costs, and reduced risk. As technology continues to grow and evolve, so does the performance marketing sector.
Price Waterhouse Coopers estimated that $6.8 billion will be spent on performance marketing in 2020. As that number continues to climb each year, it seems that performance marketing is here to stay. The real challenge for marketers is selecting the right performance marketing strategy, but don’t worry, we’ve got you covered.
Related: Choosing the Right Performance Marketing Strategy
Using Pay-Per-Call to Generate High Quality Leads
Like other forms of performance marketing, pay-per-call is cost-effective, easily optimizable, and low in risk. Advertisers who use pay-per-call only pay when they receive call leads that meet the campaign requirements they set. For example, an advertiser might pay $25 for a call that lasts 60 seconds, but the price and call duration may vary based on the advertiser’s competition and bidding strategy.
Related: Best Practices for Optimizing Your Bidding Strategy
Pay-per-call works best in verticals that require customers to call and schedule an appointment, consultation, service, etc. Some verticals that are well suited for pay-per-call include insurance, home services, auto repair, appliance repair, pest control and more.
The great thing about pay-per-call is that callers typically have a very high intent of making a purchase when they pick up the phone. In fact, 61% of mobile users call a business when they’re in the purchase phase of the buying cycle. For advertisers, this means higher conversion rates and higher ROI.