Discover how performance marketing and growth marketing work together to drive results.
Here, you’ll find:
- How the performance marketing and growth marketing differ
- Where these two strategies fit into your marketing funnel
- The benefits of performance marketing vs. growth marketing
- Which strategy is better for your business
Have you ever noticed how digital marketing has a whole lotta lingo?
Pay-per-click. Conversion optimization. Bounce rate. A/B testing. And the list goes on.
So really it’s no surprise that there are specific terms for the different marketing strategies you might choose to implement when mapping out your overall marketing blueprint.
Enter: performance marketing and growth marketing.
While each plays a vital role in helping to promote your business (or your clients’ business), it is important to understand what the two strategies involve, how they differ, and when to use them.
But before we launch into all that, we should point out that you’re likely already using both — or, at the very least, some aspects of each strategy.
That said, try not to get so hung up on the actual terms that you lose sight of the big picture.
Because at the end of the day, isn’t all marketing about performance and growth?
The answer is yes.
So, let’s start by looking at where performance marketing and growth marketing fit into the traditional marketing funnel. (Yep, we just threw another term at you.)
What exactly is a marketing funnel?
When marketers talk about the marketing funnel — sometimes called a sales funnel or a revenue funnel — they are referring to the customer journey.
In other words, the path a potential customer takes from learning about your business, service, or product to making an actual conversion. That conversion is typically a purchase. It may also be form fill, a download, a phone call, etc.
Now, depending on whom you ask, the marketing funnel may have just a few tiers or several. Those tiers may have slightly different names, but the general path goes something like this:
You’ll notice that, like an actual funnel, the path follows a top-down structure. Awareness and interest comprise the top of the funnel (TOF). Consideration and intent make up the middle of the funnel (MOF). Evaluation and action are at the bottom of the funnel (BOF).
Within those tiers will be your content — basically every piece of content you create to drive the potential customer toward a conversion. This includes:
Many sources will tell you the performance marketing mindset is often geared toward the bottom of the funnel (i.e., action driven). Meanwhile, your growth marketing goals will generally hover around the top of the funnel (i.e., awareness driven).
However, you’ll find there’s plenty of room for overlap once you have a general idea about what the two marketing strategies entail. For example, growth marketing is often seen as a full-funnel strategy.
So, without further ado, let’s talk about growth marketing vs. performance marketing.
What is performance marketing?
Performance marketing is a short-term, data-driven, paid marketing strategy geared toward new customer acquisition. Its primary goal is to get people to complete a specific action, such as purchase a product, sign up for a service, download a lead magnet, or fill out a form.
As such, pay-per-click (PPC) campaigns play a prominent role in performance marketing. Other performance marketing channels include affiliate marketing, native advertising, social media marketing (including partnerships with paid influencers), and search engine marketing.
Because it is driven by action, performance marketing relies heavily on key metrics such as cost per click (CPC), cost per lead (CPL), cost per action (CPA), and customer acquisition cost (CAC). These all help marketers measure the results of their marketing efforts to determine if their campaigns are effective.
“77% of marketers plan to increase their investment in Google Ads [Google’s PPC platform] for 2023.”
109 Google Ads Statistics For 2023 (Revenue, Data & Trends) – Demand Sage
What are the benefits of performance marketing?
Regardless of the product or service a company provide, attracting new customers is absolutely critical to ongoing business growth and success.
In this case, the benefits of performance marketing are hard to ignore:
1. Low risk, high return
Simply put, performance marketing gives you the most bang for your buck. The pay-as-you-go model allows you to choose how much or how little of your ad spend to allocate toward a specific goal, and for how long.
If something’s not working? You’ll know immediately and can tweak your strategy to optimize performance or try a different route altogether. This helps you control your advertising costs over time while enabling immediate results.
2. Easily trackable
This ties in with the first benefit. That’s because the ability to view key campaign metrics in real time means you know exactly how your return on investment (ROI) is being impacted by your online marketing efforts.
By tracking every impression, click, and conversion, it is easy to see if your campaigns are meeting expectations or if you need to make adjustments in order to optimize performance.
3. Expand your reach
Finally, performance marketing is a fast and effective way to reach as many people as possible, which will ultimately have a positive impact on business growth.
With the help of social media advertising, robust affiliate networks, and PPC platforms such as Google Ads, businesses can reach new and untapped markets to connect with even more potential customers.
What is growth marketing?
Growth marketing is a long-term, content-driven marketing strategy. The primary goal is to increase brand awareness and improve customer retention to achieve sustained business growth.
Remember the old fable about the tortoise and the hare? In that story, growth marketing would be the tortoise: Slow and steady wins the race.
Note: Growth marketing is not the same thing as growth hacking, which is often described as experimenting with low-cost, innovative strategies — typically based on current trends — to quickly boost revenue and/or attract more customers.
While performance marketing (the hare) is all about lead generation and capturing the quick sale or conversion, growth marketing strategy focuses first and foremost on engagement.
This type of holistic, overarching marketing strategy seeks to connect with and educate both new and existing customers using thoughtfully crafted blog posts and pillar pages, email marketing campaigns, lead magnets, and other value-heavy content pieces.
“It’s no secret that content marketing is key for growing businesses — especially since brands that blog have 434% more indexed pages than those that don’t.”
165 Strategy-Changing Digital Marketing Statistics for 2023 – Wordstream
What are the benefits of growth marketing?
When executed effectively, growth marketing campaigns help you connect with your audience on a deeper level to build credibility and trust, ultimately resulting in lifelong customer retention.
What can growth marketing do for your business? Here are some top benefits:
1. Increase brand awareness
Growth marketing strategy is all about introducing people to your brand story, crafting your messaging, and spotlighting what makes you stand out in the industry. This takes time (remember: slow and steady).
But as you continue to connect with people across multiple channels, provide valuable content, and engage on social media platforms, the inevitable result is that your brand will gain recognition.
2. Improve search engine optimization (SEO)
A smart growth marketing team understands that one of the best ways to improve your search ranking organically is by optimizing the content on your website.
High-quality, up-to-date content is at the heart of a strong growth marketing campaign. And, this will ultimately drive organic traffic to help your business rank higher on the search engine results page (SERP).
3. Strengthen customer relationships
Attracting new customers to your business is a solid goal, but it will only get you so far. To truly grow and scale your business, you need to nurture the relationships you build with new and existing customers.
The more time you spend getting to know your customers and their unique pain points, the stronger those relationships will become (and the more referrals you can expect).
Performance marketing vs. growth marketing: What type is better for your business?
This is actually a trick question, since both performance marketing and growth marketing are necessary to achieve results.
Rather, deciding which marketing tactics to use (or not use) has more to do with where you are in the development of your business.
Are you an established business with a sizable ad spend and you’re looking to drive traffic, boost conversions, and generate more sales? Performance marketing is the way to go.
I mention the part about budget because, as we discussed above, paid traffic is a crucial component of performance marketing and one that requires… well, money.
And, because paid traffic platforms can get pretty technical, using them correctly (i.e., so that they actually increase your return on investment) requires a slightly higher skill set. It helps to have a dedicated marketer on staff or room in your budget to outsource the job to an experienced performance marketing agency.
Are you a new startup with less wiggle room in your budget and you need to build brand awareness? Growth marketing should be your primary focus — at least at the beginning.
Again, growth marketing is all about the long game: creating brand awareness, educating your audience, and building trust and credibility.
You will never not be thinking about growth marketing. But, as business starts to pick up, you can eventually begin to add in more performance marketing-esque strategies to achieve your goals.
Now that you have a better understanding of the differences between performance marketing vs. growth marketing, you see how they fit into the larger marketing blueprint (and the benefits each strategy provides).
It’s also clear that it takes a considerable amount of time and consideration to develop a successful marketing funnel. That could mean grasping the intricacies of paid traffic platforms or crafting a powerful message and creating content that resonates with your customers long term.
No matter where you are in your business journey, HawkSEM has the experience and expertise to help you develop a winning performance marketing and growth marketing strategy. We’ll help you craft one that will drive conversions, boost revenue, and increase customer retention.
With the help of our proprietary marketing technology, ConversionIQ, our clients see an average of 4.5x greater ROI. Just imagine what we can do for your business.
Get in touch today to learn more.