Performance video tailors your advertising content to specific customer demographics.
The marketing world moves a mile a minute, and it can be hard to identify what trends will dominate the landscape. Just like programmatic advertising took the marketing world by storm, you can bet performance video is about to enjoy a similar prominence.
Digital video content is already booming, but it’s not too late to get in on the trend before it peaks. To keep up with the competition, you need to get up to speed on performance video and how it can help you grow your customer base.
The video company TubeScience defines performance video ads as “user-centric videos designed to engage a diverse set of personas.” Rather than just trying to pile up shares, these ads target demographics directly to maximize conversions and return on ad spending.
For a practical example, imagine how a coffee company might use performance ads to target specific groups. The company may target young professionals a group of office workers clustered around the coffee maker. For social activists, the same company might focus their ad on the brand’s fair-trade practices and humane worker treatment.
As with every other area of marketing, performance video results are measured with data analysis and adjustment. Companies that produce performance videos start with an idea that they think will engage their audience, then measure what works about the ad and what doesn’t work. If an ad has a good click-rate, but a poor conversion rate, marketers simply adjust to see if simple tweaks can make a difference.
Having established what performance video is, here’s why it’s transforming the marketing world:
1. Performance video gets higher conversation rate
Because performance video ads are tailored to specific customer personas, they get higher conversion rates than more generic visual advertising.
The clothing startup ThirdLove is a performance video success story. Before it invested in the tactic, the women’s undergarment company relied on static image ads that had a stagnant conversion rate. After making the switch to video, ThirdLove saw its click-through rates rise by 27 percent, while its cost per acquisition decreased by 25 percent.
Performance video maximizes conversions by communicating directly to the customer. In a video, advertisers use a clear call to action that asks the viewer to learn more, shop now or reach out. While most advertising requires the viewer to remember the ad for future research, this video tactic gives a direct step viewers can take to engage with the brand.
2. Performance video reaches new audiences.
Many brand websites use consistent, general language that’s meant to appeal to everyone who visits. By contrast, performance ads allow brands highlight specific, more niche product uses or services that will appeal to a narrow subset of customers. Not only can marketers do this with the content of the ad, but they can also play experiment with placing ads where their audiences are most likely to stop scrolling and view the video.
For example, directly market their new pocket printer to millennials customers, the tech company HP produced a series of Facebook performance videos. By testing multiple types of videos, HP discovered that their six-second videos performed best with younger videos, rather than 15-second videos. By focusing on those shorter videos, HP used performance video to drastically cut their cost per acquisition among millennials consumers.
3. Performance video works on new platforms.
Performance videos have been popular on Facebook for years, and they’re also easy to use on newer platforms like Pinterest and TikTok as well.
Pinterest is an ideal platform for performance video: Pinterest’s audience members are crafty and always looking for new projects, but they vary widely in age, artistic media and income level. Rather than trying to capture this varied audience with generic advertising, performance video allows brands to narrowly target those individual demographics.
For different reasons, performance videos are growing in popularity on TikTok. TikTok clips are 15 to 60 seconds long, a perfect fit with the quick video advertising. And because many videos on the site are intentionally low-quality, brands can keep production costs lower by minimizing editing, working with amateur actors and actresses, and creating an organic, do-it-yourself aesthetic.
Performance video may be new to the marketing world, but it is about to become one of the most important tools at your disposal. Personalization will only become more important in marketing, and brands need to create video that engages narrower audiences to stay ahead. Featuring more relevant content in an easy to package format, performance video is perfect for the modern marketplace.
Robert is the founder and CEO of Acceleration Partners. Join 100,000+ global leaders who follow his inspirational weekly Friday Forward or invite him to speak. His new book, Elevate: Push Beyond Your Limits and Unlock Success in Yourself and Others, was recently named to the Wall Street Journal and USA Today bestseller lists.