Performance Marketing Defined! - CAKE
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Performance Marketing Defined!

“What do you do for a living?” is probably one of the most frequently asked questions that new acquaintances, close friends, and family members ask me on a regular basis. It’s a very normal question to ask, but for those of us in the Performance Marketing industry, it is surprisingly difficult to answer without getting blank stares.

If I don’t really feel like going into detail about what we do at CAKE, or if I’m in a hurry to end the conversation, I’ll simply say “online advertising.” Even though online advertising does not even begin to describe what I actually do on a day-to-day basis, it’s easier for people to grasp than “performance marketing.” When I say online advertising, people nod their heads in feigned comprehension and move on to the next question.

If, however, I feel like explaining what I really spend my days doing, I’ll get more specific and tell my inquisitive friends that I do “Performance Marketing.” Without fail, “Performance Marketing” always elicits blank stares and puzzled expressions. If they seem to show genuine interest, and say something like “what is that exactly?” – I’ll launch into my version of Performance Marketing for Dummies.

If you’re also in the Performance Marketing industry, you have probably struggled with these questions from curious relatives or earnest friends before – so I’ve decided to breakdown the basics of Performance Marketing for you. This way, the next time you’re inevitably asked, “what are you doing with your life?” you’ll have a great response ready to go:

  • Performance Marketing is a form of digital advertising that allows Advertisers to pay publishers based on the performance of their marketing campaigns.
  • Advertisers are comforted by the fact that they only have to shell out money if their publishers (people running their web traffic) elicit an action (i.e., a click or a purchase) from the end user.
  • “Affiliate Marketing” and Performance Marketing are not the same. Performance Marketing is an umbrella category for Affiliate Marketing. (If they don’t know what Affiliate Marketing is, I skip this part.)

If they still don’t really understand what I’m talking about when I give them those facts, then I try and explain it from a different angle. Here’s how to break it down in even simpler terms:

  1. A user is surfing the web and sees an ad for a magazine subscription.
  2. The user is intrigued by the ad and clicks on it.
  3. They are directed to the magazine’s website.
  4. The user signs up for a subscription.
  5. The Advertiser pays a commission to the Affiliate that ran the ad that ultimately got the user to make a purchase.

Then, I’ll follow up my explanation by explaining that CAKE’s software actually makes this whole process possible, by tracking the user all of the way through the entire sign-up process. Hopefully, my friends will “oooh and “ahh” with comprehension!