Performance Marketing vs Digital Marketing: What’s the Difference?

by The MNTN Team

8 Min Read

What’s the best way to grow your business?

Marketing teams spend thousands of dollars trying to answer that question. There are all kinds of strategies for tackling this problem. Some teams focus on PPC advertising, while others focus on content creation strategies or video creation. So how do you know where to spend your marketing budget?

Performance marketing and digital marketing are two top contenders. But what, exactly, is performance marketing vs digital marketing? And—more importantly—once you know the difference between these two marketing options, how do you decide which to use? Let’s take a look.

What is Performance Marketing?

Performance marketing refers to marketing that’s focused on your team’s return on investment (ROI). Marketing strategies like pay-per-click (PPC) advertisements, cost-per-thousand (CPM) advertisements, and cost-per-action (CPA) advertisements all fall under the performance marketing category—in all of those cases, you’re paying for a specific result.

Performance marketing is a key marketing strategy for many brands. It is especially appealing to those with a tight marketing budget because they know exactly what they’re getting out of their budget when launching a new campaign. For example, if you’re paying one dollar per click in a PPC advertising campaign, and you spend $100 on the campaign, you know that you are getting 100 clicks out of that advertising campaign.

Of course, there are downsides to performance marketing strategies as well. While you can use data analysis to narrow your marketing efforts, initial performance marketing efforts tend to be painted with broad strokes. And, there’s no guarantee that the leads you generate are the types of leads you can turn into paying customers down the road.

Importance of Performance Marketing

Performance marketing is an important strategy if you’re looking to generate new leads, especially if you need to generate those leads quickly. Because you know exactly how many clicks or actions you’re getting from performance marketing efforts, you essentially pay to put eyes on your business—this can be a smart way to build brand recognition.

Performance marketing and B2B performance marketing can also serve as a low-risk advertisement strategy for brands working with an extremely tight marketing budget. Results from performance marketing campaigns are more predictable than results from other types of marketing campaigns. This may be comforting for brands struggling to set aside money for marketing efforts.

Performance Marketing Strategies

Targeted strategies are essential for achieving measurable outcomes in performance marketing. Here are three crucial performance marketing channels to start using:

Search Engine Marketing (SEM): Deploying paid advertisements on search engines to attract highly relevant traffic and generate leads through PPC.
Social Media Marketing (SMM): Leveraging paid social media ads to precisely target and engage audiences based on detailed demographic and interest data.
Connected TV (CTV) Advertising: Using CTV platforms to deliver targeted streaming ads to specific audiences, enhancing engagement and measurable results.

Performance Marketing Metrics

In performance marketing, every dollar spent should be tied to measurable outcomes—which is why tracking the right KPIs is essential. Here are the key marketing metrics that ensure your campaigns are optimized for success.

Cost Per Click (CPC): Tracks the amount paid per ad click, helping advertisers assess how efficiently their budget drives traffic to their site.
Cost Per Acquisition (CPA): Measures the cost of converting a prospect into a lead or customer, offering a clear view of campaign profitability.
Return on Ad Spend (ROAS): Calculates how much revenue is generated for every dollar spent, serving as a key indicator of advertising efficiency.
Click-Through Rate (CTR): Shows the percentage of viewers who click on an ad, highlighting how compelling and relevant the messaging is.
Conversion Rate: Measures the percentage of users who take a desired action, like completing a purchase or signing up—directly reflecting campaign performance.

What is Digital Marketing?

Digital marketing refers to any marketing efforts that take place online. This is a broad category that may include performance marketing but could also include growth marketing and other strategies.

The idea behind digital marketing is to focus on where you’re advertising more than how you’re advertising.

Importance of Digital Marketing

Digital marketing meets customers in the location where they spend the majority of their time: online. By focusing on different channels, digital marketing experts can both generate new leads and nurture existing leads.

Omnichannel customer engagement is one of the tenets of successful digital marketing. Marketing teams focused on omnichannel engagement can tell their brand story across different marketing channels. So, customers can have the same branded experience whether interacting with your brand on social media, via email, or in text form. Studies show the value in this; companies with omnichannel marketing strategies retain an average of 89% of their customers.

Digital Marketing Strategies

A diverse approach to digital marketing involves various strategies to effectively reach and engage your online audience. For example:

Content Marketing: Producing and sharing valuable content to attract and retain an audience, thereby building brand authority and trust.
Search Engine Optimization (SEO): Enhancing your website and content to achieve higher rankings in organic search results and drive more organic traffic.
Email Marketing: Crafting and sending personalized emails to engage leads, foster customer relationships, and promote offerings.
Influencer Marketing: Partnering with influential figures to utilize their credibility and follower base to amplify your brand’s reach.
Affiliate Marketing: Collaborating with affiliates who promote your products or services, earning a commission on the sales or leads they generate.

The point is, that these strategies can be almost anything in the digital realm (including performance marketing strategies).

Digital Marketing Metrics

Understanding what’s working (and what’s not) requires tracking the right digital marketing metrics. These KPIs help measure audience engagement, content effectiveness, and overall campaign impact.

Website Traffic: Tracks how many visitors land on your site, offering insight into your brand’s reach and digital marketing effectiveness.
Bounce Rate: Measures the percentage of users who leave after viewing just one page, helping assess content relevance and site performance.
Average Session Duration: Shows how long visitors stay on your site, indicating how engaging and valuable your content is to your audience.
Email Open Rate: Tracks the percentage of recipients who open your emails, providing insight into the effectiveness of your subject lines and messaging strategy.
Social Media Engagement: Captures likes, shares, comments, and interactions, showing how well your content connects with your audience.

Digital Marketing vs Performance Marketing

Once you know what performance marketing and digital marketing are, it’s clear that these two marketing strategies are not in direct competition with one another. Understanding both digital and performance will give you a more complete picture of your marketing efforts than understanding just one or the other.

Here’s a brief summary of the differences:

Goal Orientation

Performance Marketing – Designed to drive immediate, measurable actions, such as clicks, conversions, or sales, ensuring that every dollar spent ties directly to a result.
Digital Marketing – Focuses on long-term brand building, audience engagement, and customer relationships, often working toward broader goals that don’t always have instant attribution.

Types of Metrics

Performance Marketing – Success is measured by hard metrics like Cost Per Acquisition (CPA) and Return on Ad Spend (ROAS), ensuring clear, data-backed campaign performance.
Digital Marketing – Tracks higher-funnel indicators such as website traffic, social media engagement, and content performance, which may take longer to translate into revenue.

Cost Structure

Performance Marketing – Advertisers pay only for completed actions, making it a highly cost-efficient strategy that minimizes wasted spend and prioritizes ROI.
Digital Marketing – Often requires upfront investment in areas like SEO, content creation, and social media, with returns compounding over time as brand equity grows.

Combining Digital and Performance Marketing

When you think about combining digital marketing and performance marketing, the main goal is to work performance strategies into your broader, overall digital strategy. Your marketing team should ask, “How can performance marketing support my overall digital marketing efforts?”

How Performance TV Can Help

Want a digital marketing strategy that prioritizes measurable results? MNTN’s platform brings performance marketing to CTV, ensuring your television marketing campaign doesn’t just drive awareness—it drives action. With AI-powered targeting, automated optimization, and real-time attribution, every campaign is built for efficiency and impact.

Here’s what you get with MNTN Performance TV:

MNTN Matched – AI-driven targeting ensures your ads reach high-intent audiences most likely to convert.
Premium CTV Inventory – Secure ad placements on top streaming networks, putting your brand in front of engaged viewers.
Verified Visits™ Attribution – Connects ad impressions to site visits and conversions, giving you clear, measurable performance insights.
Automated Optimization – AI continuously refines your campaign in real time to maximize efficiency and eliminate wasted spend.
Reporting Suite – Access real-time data on engagement, conversions, and ROI to optimize with confidence.

Make CTV advertising the most effective part of your digital marketing mix—sign up today to get started with MNTN’s self-serve software.

Performance Marketing vs Digital Marketing: Final Thoughts

Digital marketing is a broad marketing strategy that focuses on omnichannel customer engagement. And while digital will always be an important aspect of marketing your business, if you focus on this alone, you risk missing out on the power of performance marketing.

Only when you understand both digital and performance marketing can you learn to meld these strategies together to create a strong marketing plan to best support your business.