In a downward market, does a positive correlation between brand awareness and customer acquisition still exist? This is a realistic concern addressed by advertisers who choose to allocate their budget towards a Branded or CPM-based model. Recession worries only continue to rise for understandingly anxious and apprehensive Americans, while consumption drastically decreases. Consumers no longer act in such a way that awareness of a product will directly result in increased sales of that product. We see this change occurring in our economy on a daily basis. Brands we’ve come to know and love are closing their doors at an alarming pace. What is a company to do when branding just isn’t enough?
What if I told you that you could place your product in front of millions of potential customers, and only spend your advertising dollars when a customer has been acquired? Sounds too good to be true, right? Think again!
If you’re working on a CPA, or Cost Per Acquisition, basis, your dreams have come to fruition. Performance-based marketing provides a no-risk alternative to reaching a premium audience, providing the simple solution to the rise of the recession and smaller budgets. A set action is determined by you, the advertiser, prior to the launch of your campaign into the marketplace. Required actions may range from a simple email address to the purchase of a product, in which payouts to affiliates will be applied accordingly. Therefore, advertising dollars are only spent when the set objective has taken place, resulting in an immediate return on investment.
Performance-based marketing also allows advertisers to fully take advantage of the technology that online advertising provides – the ability to track sales and gather data on existing customers. In last week’s article titled What to Look for in a List Management Company, author Bryant Valentine stated that list management is “one of the largest and quickest ways to add another source of revenue to your business model with not a lot of work involved.” Performance marketing and effective list management open up the opportunity to target existing consumers directly, a customer base that is much more likely to respond during a recession.
The preference of working on a CPA basis has been evident as large brands are shifting away from branding and more towards a CPA model. Smaller budgets require increased accountability on each advertising dollar that goes out. With performance-based marketing, dollars spent towards wasted views and impressions are a part of the past. Advertisers now have the ability to see detailed, measurable results immediately following their marketing efforts, and are able to allocate their budget accordingly.
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