Growth marketing and performance marketing are the two most frequently used yet most commonly misunderstood and misused terms in digital marketing. If you are looking to learn these strategies, it is important to know the difference between them.
Growth Marketing is a process of marketing that concentrates on the overall growth of the organisation, its visibility, reach and awareness. It doesn’t limit its scope to any part of the marketing funnel. On the other hand, Performance Marketing concerns achieving a specific objective in a short span of time.
While these two terms are often used interchangeably, they both are used for different business objectives and are completely different from each other. In essence, growth marketing concentrates on whether the right marketing campaigns are run by the company and focuses on the long term objective of business growth. Performance marketing concentrates whether the marketing campaigns are run right and focuses on how efficient the objective is achieved.
It is to be noted here that another commonly used term, “growth hack” is often confused with growth marketing. Growth hack is essentially employing every trick and twist in the marketing playbook to increase the reach, online presence and awareness about the company. Growth hack consists of practical tactics while growth marketing is a whole different strategic outlook towards the growth of the business.
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Performance Marketing Provides Results in the Short Run
Performance marketing is the go to marketing method for people who require immediate results. It focuses on attracting the people who are at the bottom of the funnel and on achieving specific short-term objectives. Some of the most common aspects of performance marketing are
- Social Media Advertising – Facebook, LinkedIn, (X) Twitter, LinkedIn.
- Search Engine Marketing – Google Ads, Bing Ads, etc.
- Influencer Marketing and other avenues in which you need to pay a sum beforehand and then wait for the results.
Performance marketers are usually focused on metrics like Cost Per Acquisition (CPA / CPL), Cost Per Click (CPC), Return on Ad Spend (ROAS) and other key performance indicators (KPIs).
Running advertising campaigns with specific short-term objectives like increase in the visibility, more number of signups, leads, etc. all fall into the ambit of performance marketing.
For instance, if an ecommerce store wants to market its launch, inform the potential customers about the launch offer and drive ‘x’ unit of sales of the products, then the performance marketer would
- Run ‘Awareness Ads’ about the brand launch
- Partner with influencers to share news about the launch and offer
- Run traffic ads to drive people to the website and
- Finally run conversion ads to drive sales of the products.
These are all performance marketing initiatives of the brand.
Growth Marketing Provides Better Results in the Long Run
Now let us assume the same ecommerce brand that has recently launched its online store and has run a few advertisement campaigns. In the long run, the company can’t depend on the advertisements alone for the sales. Without getting consistent repeat orders from customers, the business can’t turn profitable.
This is where growth marketing comes into play. It is the comprehensive approach that focuses on the whole marketing funnel, and it concentrates on providing a better customer journey and involves
- Product Development
- Enhancing User Experience (UI/UX fixes)
- Conversion Rate Optimisation
- Content Marketing
- Brand Building
- Partnerships
- Search Engine Optimisation, etc.
A growth marketer would concentrate on indicators such as Customer Lifetime Value (CLV), Customer Acquisition Cost (CAC), Brand Health, etc. Growth marketing focuses on building a long term association with the customers and clients thereby enhancing the profitability of the company in the long run.
A Business Needs to Balance Both these for Good Profits
So, growth marketing or performance marketing, which is important for a business? Is it necessary to start with the latter and then shift to the former or vice versa?
While growth marketing and performance marketing are just different strategic approaches to business growth, both of these are required for all companies. A balanced approach that integrates the key aspects from both these strategies is necessary for consistent growth.
Depending on the business lifecycle, a company should prioritise the budgets for both of these strategies. During the launch period, the focus should be on performance marketing, and then include growth marketing strategies during the growth stage. This helps in a slow but steady growth of the business.
Learning Digital Marketing is Easier than you Think
Digital Marketing helps businesses to reach potential customers and clients using digital avenues and platforms. If you are looking to learn growth marketing and performance marketing to grow your business or to get placed as a marketer in leading companies, you need to learn digital marketing from a professional institution.
Learning from YouTube videos or pre-recorded courses is not the ideal way to learn growth marketing as you need constant practice to truly master the growth marketing concepts and performance marketing tactics.
At Indras Academy, we provide a 100% practical course during which you will work in live projects and learn while doing the work. Book a free consultation with us today.
