By Chuck Leddy
Performance marketing is one of the biggest B2B marketing trends of 2019. Indeed, marketing agencies view it as a top 3 trend for this year, according to B2B Marketing’s editor-in-chief Joel Harrison. Yet there’s much confusion about exactly what performance marketing is, why it’s relevant for B2B marketers, and how marketing teams can begin to implement it.
Some basic questions about performance marketing were asked and answered during a March 27 webinar on performance marketing hosted by Harrison, and including three experts on the topic: Andrea Reginato, Director of Performance Marketing Solutions, Expandi Group (an agency), Julien Scott, Head of Digital Marketing EMEA, Cushman & Wakefield (a commercial real estate firm), and Mark Terry, Head of Marketing, Vuzion (a cloud solutions provider). The expert panel began by seeking to define performance marketing, then moved on to explaining its relevance for marketers, before offering “next steps” in implementing it.
What is Performance Marketing, anyway?
Harrison began by offering a definition from the Performance Marketing Association, which says it “refers to online marketing or advertising programs in which advertisers and marketing companies are paid when a specific action is completed, such as a sale, lead, or click.” Each of the panelists found this PMA definition insufficient or incomplete for various reasons.
“Performance marketing is actually more of a mindset, a way of working,” explained Vuzion’s Mark Terry, “because everything is measurable today. Marketers need to explain our value to the overall business; we need to connect everything we do to business goals and ROI. If we don’t hold ourselves accountable in this way, we can lose budget and credibility with the overall business and leadership team.” Julien Scott from Cushman & Wakefield agreed, adding that “performance marketing is really about driving marketing accountability and showing our marketing ROI.”
A more expansive view of Performance Marketing
The webinar experts expressed a desire to include with any definition: (1) the need for expanding performance marketing beyond just digital channels and (2) aligning it with larger business (not just marketing) goals. Expandi’s Reginato said, performance marketing “isn’t just about clicks and downloads, performance marketing should be strategic and move beyond digital channels to cover the entire customer journey, all the touch points online and offline.”
Scott agreed, then mentioned a few challenges to measuring the performance of top-of-funnel activities, such as building brand awareness. “Top-of-funnel metrics are softer, harder to measure, but so important. You just can’t do lead nurturing in the mid-funnel and conversion at the bottom of the funnel without investing in that top-of-funnel work.”
Scott and Reginato agreed that top-of-funnel activities were harder to bring into any performance marketing approach. “I’d be inclined to exclude top-of-funnel activities from performance marketing,” said Scott, “because PM is more about conversion than building brand awareness.” Reginato agreed, adding, “it can be so difficult to accurately measure the value of these top-of-funnel activities.”
On implementing Performance Marketing
Julien Scott took the lead on suggesting next steps for marketing teams wanting to implement performance marketing, noting that “most B2B marketers are in the early stages of understanding and piloting performance marketing initiatives.” Indeed, a survey taken of webinar viewers found that 43% of marketers don’t even know how to define performance marketing, and aren’t implementing it, while another 9% of those surveyed were considering or planning a pilot in performance marketing.
So currently, most marketers are either unaware of what performance marketing is or only now beginning to consider it — “early stage” is indeed the best way to describe its maturity. Here’s what Scott suggests for marketers wanting to gain more performance marketing maturity:
- Map out the customer journey. “You need to begin with a customer-centric approach,” says Scott. “Look at each step of the customer journey, and clearly define your key performance indicators/KPIs, especially those that might resonate with your C-suite leadership.”
- Define a “performance strategy.” As Scott explains it, ‘you need to clearly define what success looks like across the entire B2B sales engagement process.” So begin with the end in mind, and figure out the steps in between to take you there.
- Align with relevant departments. Scott makes it clear that marketers need to “speak the language of the business, and work across departments to achieve mutually-agreed-upon performance goals. Have an ongoing conversation with impacted departments because performance marketing is a continuous, iterative process that involves working with sales, IT, finance, and other functions.” Driving better performance requires you to close the loop between marketing actions and value.
- Don’t get too fancy, too fast with martech. All the experts agreed that buying expensive, cool martech isn’t the answer for doing performance marketing. “Start with the basics in your martech stack first,” suggests Scott, “and then drive adoption of full-functionality before you get fancier with more martech.” Scott notes that his team at Cushman & Wakefield is now using Salesforce for its CRM and Marketo for marketing automation, and building atop that firm foundation.
What comes across most clearly from these B2B marketing experts is that performance marketing is more about driving accountability for marketing teams, getting them to speak the language of business and “prove” marketing ROI. It’s not centered on whizbang technology (which does help, of course). Accountability matters across the entire business, including for marketing: the days of marketers relying on intuition to develop campaigns and then tracking them with fuzzy, back-of-the-napkin metrics are nearly gone.
Definitional challenges aside, performance marketing will definitely (pun intended) continue to emerge as a key B2B marketing trend in the coming years.
Reach out to us if you’re interested in discussing how we can help you to build a more mature marketing organization. (Seriously, reach out – this is one of our favorite topics and we’d very much enjoy hearing from you.)