Growth Marketing vs. Performance Marketing: Must-Know Facts

To understand a growth marketing strategy, you must start with traditional marketing. Typical marketing methods focus on the top of the funnel. For example, a conventional marketer aims to increase brand awareness, traffic, and leads in the awareness and acquisition stages. Then, the sales team handles the rest of the funnel stages.

A growth marketer fixates on the entire funnel. They drive business growth across the organization through each stage: awareness, acquisition, activation, retention, referral, and revenue (AARRR). Growth marketing spans the entire process, from lead generation to customer acquisition to customer retention. 

At O8, we use a repeatable process and roadmap for growth marketing. We employ various tactics to align, engage, convert, grow, and scale your business.
 

Learn more about our growth marketing framework

When your brand is ready to scale, we initiate Digital Integrity Optimization (DIO™️). This framework—which includes CRO, web design, UX, search engine optimization (SEO), pay-per-click (PPC), and other traffic—prioritizes problems and opportunities by business impact. It’s this ongoing optimization that continues to increase your ROI.
 

Etsy

More than four million sellers and nearly 40 million buyers use Etsy. The company started in 2005 and found growth opportunities at craft fairs and flea markets. These events helped the startup connect creators with established audiences with its eCommerce platform. Etsy attributes its continued growth to split testing and experimentation.
 

Slack

Slack grew from 15,000 free users in 2014 to over three million paid users today. The communication tool started by inviting organizations to try out the beta platform. Then, developers drew on user feedback for the next six months to refine the product. Slack continues to use growth marketing to enhance user experience and retain customers.
 

Zoom

Zoom’s been around since 2011, but it became a household name during the pandemic. Now, this video conferencing tool has more than a half million business customers. The company created a growth loop allowing users to meet with anyone with an email address. This perk enables more prospects to try out the tool and opt for extra features with a paid subscription.

A growth marketer searches every nook and cranny of a business for growth opportunities. This sleuthing has several benefits.
 

Improved Efficiency 

Growth marketers use data to track the effectiveness of their marketing effort and optimize their strategies in real-time. This transparency helps them get more value out of their marketing budget.
 

Greater Focus

Growth marketing is not about generating as much visibility as possible. It’s about identifying your business's most effective marketing channel and tactics. This focus helps your growth marketing team’s efforts become more targeted and strategic.

Data-Driven Decisions

Growth marketers don’t rely on their instincts to choose their next move. They use analytics to inform their decisions. This scientific approach helps them refine strategies and create better outcomes.
 

Long-Term Results

Sustainable growth is at the heart of growth marketing, which prioritizes long-term performance in marketing over short-term gains. It’s not a technique for short-term spikes in traffic or sales. With an aspiration for longevity, growth marketers build a solid foundation for success.

Growth marketing is consumer-centric and focused on retention. Marketing teams that want to connect branding, product development, engineering, and design will choose this replicable path for success. Using scientific methods ensures that each aspect of the process is testable, scalable, and trackable.

A performance marketing strategy focuses on delivering measurable results and optimizing campaigns based on their effectiveness.  The main types of performance marketing channels include social media advertising, search engine marketing (SEM), influencer marketing, and sponsored content. Other common performance marketing types include affiliate marketing, email marketing, and display advertising.
 

Social Media Advertising

Social media advertising uses platforms like Facebook, Twitter, and Instagram to promote products and services. Ads may be in the form of sponsored posts, display ads, or video ads. You target certain users based on their interests, demographics, and behaviors. 
 

Search Engine Marketing (SEM)

Search engine marketing (SEM) is a performance marketing channel that involves promoting websites and online content through search engines, such as Google and Bing. You create campaigns with specific keywords and bid on those terms. Then, your ads appear during searches.
 

Influencer Marketing

Influencer marketing is a valuable strategy for brand marketing, as it allows you to connect with your target audience through authentic endorsements from trusted influencers. Through this strategy, your brand partners with people who have a large online following. It’s particularly effective for reaching younger generations who may distrust traditional advertising. Forms include sponsored posts, product placements, and sponsored events or campaigns.

Sponsored Content

With sponsored content, you pay to have your message featured on a website or platform. It blends in with other content, so it’s more subtle and less disruptive. Forms include articles, videos, podcasts, and social media posts.

A performance marketing manager drives the marketing team's commercial performance. Performance marketers plan and execute campaigns to meet their Key Performance Indicator (KPI). In addition, this marketing leader tests new performance marketing channels and trends to improve ROI. They also allocate and optimize budgets to maximize cost per acquisition (CPA) and scale new customers.

Performance marketing is a low-risk, ROI-focused digital marketing strategy with many benefits.
 

Cost-Effectiveness

A performance marketer drives specific, action-based business goals. So it’s often more cost-effective than other types of marketing. For example, with PPC, you only pay when someone clicks on your ad instead of paying for placements or impressions.

Another example is affiliate marketing, where you pay a commission only when a sale is made through a partner's referral. With affiliate marketing, you're only spending in marketing efforts that directly contribute to your bottom line.
 

Targeted Reach

With performance marketing, you target certain groups of people based on location, interests, or behaviors. This segmentation helps you reach the right people when they’re looking to buy—increasing your chance of success.
 

Improved Customer Experiences

Because performance marketers target certain prospects, they can create more relevant content for customers. This personalization leads to better engagement and enhanced experiences.
 

Measurable Results

For performance marketers, results are based on customers completing specific actions. So the outcomes of the marketing campaign are easy to track. When you compare the results to your marketing goals, you can see what’s working and what’s not—and adjust.

Performance marketing depends on targeted, personalized campaigns. For your performance marketing campaign to succeed, you must know (and learn from) your audience. A/B testing two campaign versions is essential to understand what content performs well. Continuously monitoring performance allows for informed decisions on current and future campaigns.

While growth marketing and performance marketing share some commonalities, there’s a time and a place for each approach. Here are their similarities and differences.
 

Growth Marketing and Performance Marketing Similarities

Growth marketing and performance marketing use data and analytics to drive business results. These approaches involve setting specific goals and tracking marketing efforts. Growth marketing and performance marketing also use continuous testing to optimize strategies and improve outcomes.
 

Growth Marketing and Performance Marketing Differences

What is the key difference between growth marketing and performance marketing?

Growth marketing focuses on the entire funnel, while performance marketing only involves the bottom of the funnel. With growth marketing, you target prospects in each stage of the funnel. In performance marketing, you zero in on people who are most likely ready to take action, like filling out a form or making a purchase.
 

Growth marketing builds long-term business growth by forming customer relationships. Performance marketing is a short-term strategy to convert new customers quickly. In growth marketing, you rely on a broader range of marketing channels, such as content marketing, social media marketing, and email marketing. With performance marketing, the focus is more on paid platforms, like Google Ads, Facebook Ads, and LinkedIn Ads.

Performance marketing can play a role in growth marketing’s holistic approach to digital marketing. Depending on your business status and objectives, you may focus more on one method than the other.

For example, if you’re trying to build a customer base and keep that audience coming back, you should put your efforts into growth marketing tactics. But planning performance marketing campaigns makes more sense if you're an established brand that needs to hit certain KPIs and sales quotas for the month.
 

Growth marketing and performance marketing work together in digital marketing to cover every stage of the buyer’s journey. Growth marketing builds awareness, attracts potential customers, and keeps customers happy. Performance marketing is an extra nudge that marketers can use when they need to convert prospects into customers quickly.

You don’t have to choose between growth marketing and performance marketing. There’s room for both approaches in your digital strategy.
 

O8 offers growth marketing services and performance marketing tactics to grow and scale your business.

Please leave us a note to discuss how our marketing agency can help you succeed.