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The State of Performance Marketing: What You Need to Know for 2016

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Today's consumers are increasingly demanding meaningful, one-to-one experiences with brands, causing personalized marketing to reach tipping point. Moreover, the need for brands to deliver meaningful consumer journeys led to a surge in the adoption of performance advertising.

Fortunately, marketers have new tools necessary to execute successful digital strategies. But those new tools present unique obstacles in terms of implementation and integration with existing advertising campaigns like social marketing or paid advertising.

To find out how brands this year are investing and succeeding with performance marketing and overcoming its challenges, we commissioned Forrester Consulting to survey just over 150 marketers in the US, UK, France, and Germany.

Performance Advertising Moves Past Retargeting

Retargeting is a key performance marketing tool that includes personalization, dynamic creative content, and the ability to deliver ads seamlessly across channels and devices.

This tool also includes the unification of customer data through the integration of disparate data sets, including consumer relationship management (CRM) data, inventory management systems, and social media. That data helps marketers better understand how online behavior and advertising transfers to in-store activity.

Forrester found that marketers who invest in at least two advanced retargeting tools along with retargeting campaigns see a better ROI across all their marketing activities and increased effectiveness when compared to their peers. In fact, these marketers were 32.8% more likely to say advertising had become more effective in the past two years.

Moreover, Forrester asserts that, although these capabilities are currently competitive differentiators, they are quickly becoming table stakes for effective marketers and for digital and in-store sales growth.

The Consumer Experience Is Now Cross Device

Over the years, digital advertising has faced myriad challenges, including ad fraud, ad blocking, data privacy, and mobile ad effectiveness.

Despite those challenges, digital commerce continues to grow at an unprecedented rate. Performance marketing continues to encourage online shopping by targeting the right consumers at the right moments on their preferred devices.

Though performance marketing continues to deal with industry obstacles as the industry evolves, performance marketing is effective. It works as consumers get more comfortable shopping online and on their mobile devices. That's why the digital marketing budget in 2015 accounted for over a quarter of total ad spend.

The need for a cohesive, cross-device digital ad strategy is likely the reason why Forrester found that 46% of marketers are retargeting across multiple devices and channels—including mobile Web, mobile in-app, email, and social platforms—to hone in on consumers who have already expressed interest.

Moreover, 66% of those surveyed focus their performance marketing on getting consumers to make a purchase, and 42% also noted its benefits for general ongoing consumer engagement.

Rewards Outweigh Implementation Challenges

Though digital advertising has come a long way since the first online banner ad in 1994, the industry is still in its early days. Some very real hurdles still exist.

Forrester has identified customer data integration, which is key to serving relevant ads and driving performance, as the top struggle.

Other key difficulties include...

  • A lack of internal knowledge and skills to handle enhanced retargeting programs
  • Maintaining consumer data quality
  • Getting the right allocation of funds

Marketers are tackling these issues head on. They understand that doing so is important—not only to their performance marketing efforts but also for their ability to better track and report on the ROI of all their marketing activities.

A total of 70% of survey respondents said they plan to improve measurement of their ad spend effectiveness. Some 64% said they plan to invest in better integration of their CRM data for attribution and measuring marketing performance.

For more insights into the evolving performance marketing landscape, download the full research study.

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James Smith is executive vice-president of Americas, Criteo, a global performance marketing technology company that enables e-commerce companies to use large volumes of data to efficiently and effectively engage and convert their customers.

LinkedIn: James Smith

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  • by Guillaume Fri Feb 12, 2016 via web

    Sad promotional article.

    "Performance Advertising Moves Past Retargeting"
    This is such B.S. - you either know nothing about online marketing or just want to speak about your own Criteo solutions. Shame on you in both cases.

    Performance marketing has been much more than retargeting for a long long time and will continue to be.

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