How Performance Marketing Can Create New Channels and New Customers

We recently had the opportunity to interview Steve Netzley, CEO of Havas Edge, one of the largest full-service Performance Response Marketing agencies. In recent years, he’s been at the forefront of performance marketing campaigns and has helped many large companies build better results through their focus on relationships.

Here are the five key takeaways from the interview:

1. The Objective is Different

Although Performance Marketing (PM) is similar to traditional advertising in many regards, the objective is different.

PM is about understanding the relationship between the cost associated with broadcasting a message and the relationship the message acquires. Conversely, Traditional Advertising cares more about how many people have seen the message rather than the actual outcome.

2. The Relationship May Be Free at First

While on the topic of the cost to acquire a relationship, Steve points out that in many cases, establishing the relationship might not bring immediate revenue. Think about most advertising campaigns; there’s usually a free incentive to get the prospect to sign up. Whether it’s a 30-day trial or a gift, hooking them in with a free offer might not make financial sense at first, but will pay dividends in the long-run.

3. Customer Information Optimizes Creative

Because PM uses KPIs focused on the end result, marketers can learn more about their customers to optimize future campaigns. Steve gives a great example through his work with Vista Print. Since their offer is targeted towards professionals seeking business cards at a disruptive price, they can compel them to go online.

Once there, Steve then learned that these same customers might be interested in other products like stationary as well. If they had taken a traditional approach, all they would know is how many people saw the ad and responded – not built a relationship for future purchases.

4. Offline Advertising Creates the Customer

When discussing how PM benefits online businesses, Steve made it clear that offline advertising still plays an essential role in the marketing mix. Online, your goal is to simply be present for the customers already looking for a business like yours. Offline, however, is where you create the person looking for your business. While it might seem like you need to choose between online and offline advertising, in reality, they both must work hand-in-hand for an infinitely scalable PM campaign.

5. PM is More Cost-Effective than Traditional Advertising

The final takeaway from the interview relates to the cost and risk associated with PM. In traditional advertising, you’re paying to get your ad in front of as many eyeballs as possible. Whether these said people take action is unrelated, but you’re essentially throwing your message out to see if it sticks.

In PM, you can spend far less and determine whether your message resonates and initiates action in a short amount of time. This reduces your budget risks significantly, and businesses have more flexibility to try different messages.