Editor's note: The following is a guest post from Dale Carr, founder and CEO at Leadbolt.
A brand advertiser's mission is to cultivate a tribe of believers and create a strong affinity for a product or service. When brand marketers evaluate the success of an ad campaign, results are often measured in terms that reflect their goals to build awareness, communicate a brand promise or value proposition and shape positive sentiment. Building awareness and shaping sentiment are important and necessary conditions for priming consumers to make an eventual purchase. Yet 'awareness' and 'sentiment' are broad strokes, and can be illusive, difficult to track and quantify. This challenge is nothing new to brand marketers, but conventional brand advertising practices endure because they work, and we all enjoy powerful storytelling that resonates in our hearts and minds.
Yet consider this: In the age of mobile and an omni-channel brand presence where shoppers seamlessly transition between online, mobile and in-store visits, there is another — and more measurable — approach to advertising that can be equally valuable for brands: performance marketing.
Mobile performance marketing allows marketers to achieve specific KPIs such as retention and lifetime value of a customer, by driving and measuring distinct types of actions. There's the obvious action: get audiences to download the brand app. Going one step further, tying mobile campaign performance to specific revenue-generating actions such as making a purchase, visiting a level or area within the app, redeeming a coupon, completing a form, or returning to the app within a given time span, are also possible. Advertisers only pay when a specified action is completed.
Achieve specific KPIs
Paying on CPM (cost per thousand impressions), as most brand campaigns and even performance marketers are set up to do (when buying programmatically), means marketers are paying based on how many times the ad is served — reaching an estimated number of eyeballs — regardless of whether or not the user clicks on an ad.
However, working with your mobile ad platform partner to set up your performance marketing campaign budget according to specific consumer actions can be more efficient than the risk of paying large amounts for advertisements that may not be seen.
With conventional brand advertising, marketers may spend additional budget on surveys to prove campaign efficacy and maintain accountability. Measuring signals such as "ad recall" (e.g., Do consumers remember seeing the ad?), aided awareness (e.g., Do consumers remember the ad if given a gentle reminder about the ad?), propensity to purchase (e.g., How likely are consumers to make a purchase from the brand as a result of being exposed to the ad?), provide assurance that awareness and sentiment can be achieved. With performance marketing, the consumer actions are quantifiable, removing the guesswork about whether or not a campaign was effective.
Targeting for value
Targeting and the science of reaching the most relevant audience can be more precise with performance marketing, since advertisers are only paying for specific actions. There is more pressure on the ad delivery platforms to find proven, quality sources of traffic and reach high quality audiences that are the most likely to take action.
The bottom line
I'm not advocating to replace brand advertising with performance campaigns, but I am suggesting that for many brands there is room to consider both in the media mix. If your company has identified specific in-app mobile behaviors that equate to higher ROI for the brand, there’s a strong argument in favor of using performance marketing to achieve more of them.