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How to Increase Customer Retention with Performance Marketing

Last Modified: February 13, 2023

How to Use Performance Marketing to Increase Customer Retention For Your Beauty Brand

It’s harder than ever to keep your customers’ attention. Email marketing and social media, in combination with in-store offerings, give your beauty brand more touch points than ever before — yet your marketing dollars can often feel less effective. Traditional advertisements are becoming less cost-effective for brands as consumers turn away from traditional media to more crowded social media platforms. In response, savvy beauty brands are turning to performance marketing to improve ROI for advertising dollars and increase customer retention.

What is performance marketing? Performance marketing is an online marketing strategy that is based on quantitative results. You may be familiar with the concept of affiliate marketing — this is a popular type of performance marketing strategy. The spend on affiliate marketing in the U.S. is $8.2 billion.

Performance marketing offers a unique opportunity for a win-win situation for both the ad publisher and the retailer. With this approach, your beauty brand only pays out for an advertisement once a specific objective is reached, giving you a guaranteed ROI. And the ad publisher is incentivized to use highly effective conversion-oriented advertising to maximize their payout. Implementing performance marketing can increase your beauty brand exposure, increase sales, and improve customer retention. Here’s how to get started.

Create Your Performance Marketing Strategy

Just as you would for other advertising campaigns, you need to set your goals for a performance marketing campaign. Since this strategy is outcome-based, you need to be crystal clear about your goal outcomes. Your campaign can target new sales, new leads, website or link clicks, or something else you find valuable.

You must be able to track your goal outcome. Software and online advertising tools can help track your KPIs for performance marketing campaigns. Generating reports and exporting performance data can help establish trust with your ad publishers. This can lead to long-term relationships that increase customer loyalty as fans enjoy engaging with the ad content from certain publishers.

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Partner with Ad Publishers

The next step is to partner with ad publishers who can launch your campaign. For your beauty brand, this may look like setting up an affiliate marketing program and inviting loyal customers to join. You could reach out to beauty influencers and ask for a collaboration detailing your goal outcome metrics.

Even though you are paying based on performance, you should be selective about which ad publishers you partner with. It takes time and effort to set up a campaign, discuss deliverables, and track your desired outcome. Reaching out to influencers and affiliates with an established and engaged audience similar to your ideal customer can help you achieve results faster.

Depending on the size of your brand, it can be helpful to offer a brand guide to affiliates and influencers joining your performance marketing team for the first time. This helps them create content and advertisements that match your brand voice and grow your brand influence. You can also include guidelines to help them remain compliant with FTC regulations and avoid fines.

Track Your Results

After your performance marketing campaign goes live, it’s time to track results. This can be simplified with affiliate tracking software. The software will keep track of clicks, leads, and sales for each affiliate or influencer. You’ll be able to generate reports to track the campaign’s success and identify areas for improvement.

In addition to your goal outcome, you should track other KPIs to determine the overall success of your performance marketing campaign. Understanding bounce rate and click-through rate, and comparing ad content, can inform areas to target in future marketing campaigns.

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Integrate Feedback

Performance marketing provides a closer connection between your brand and customers than traditional advertising offers. Many affiliates and influencers have conversations with their referrals before they complete a purchase. Customers may offer feedback more willingly to affiliates and influencers because they feel a closer personal connection.

Reach out to your ad publishers during and after any performance marketing campaign and listen to their feedback. They might offer a way to improve the user experience on your platform to increase the number of conversions, for example. Or they might offer a new product or subscription idea that brings customers back to your brand month after month.

Get Started Today

Performance marketing delivers results for both retailers and ad publishers. The types of advertisements created through this approach can inspire consumers to buy more — and remain loyal to — individual brands. With just a few simple steps, you can launch your first performance marketing campaign and grow your beauty brand.

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Written by

Ruthie Carey
Ruthie Carey