Performance Marketing Agencies + How to Find A Good One

Performance media buying feels unavoidable. Facebook Meta, Google, and Amazon receive 74% of all digital ad spend, and 47% of all advertising spend globally. Performance Marketing Agencies exist to help brands navigate these complex platforms (1). But with a low barrier to entry, little agency differentiation, and growing reliance on built-in AI optimization within these platforms, it begs the question:

Are performance marketing agencies actually necessary?

Here are the top 3 Performance Media Agency fails that we see, and our perspective on how, when, and why to avoid them when evaluating performance marketing agencies.

It’s impossible to please all people all of the time. But performance media firms try anyway. Working in a market of so few ultra-entrenched performance media platforms (Google, Meta, and Amazon – the leading retail media network and growing ad behemoth), these firms often fall prey to 3 fatal “fails”:

1. Unclear role: Is the job of an agency to babysit machines, or to use technology toward a higher purpose? Should compensation be a factor of the spend “under management”? Or does this create a disincentive to slim cost-per-acquisition over time?
2. Overdependence on automation – true that Google, Amazon, and Meta own some of the most sophisticated AI on the planet. But these platforms are designed – with algorithms, artificial and actual intelligence – to maximize your tolerance for spend, rationing their performance and goal delivery to maximize their ability to monetize their audience. The machines are not your friends.
3. The Hammer Problem – “If all you have is a hammer, every job is a nail.” Performance is simply more than just paid performance media. It’s building the funnel to build a business. It’s growing audiences. It’s optimizing the site and sales experience.

Read on for our point of view on how, when, and why to evaluate performance marketing agencies.

The magic of performance media lies in the automated, market-based ability to buy media from many sources via centralized platforms. Performance media buying opens up a world of possibilities for video and CTV, digital display, programmatic audio ads, retail media, and search integrations. Theoretically, performance media helps global brands buy higher quality media, not just greater volume.

However many of these benefits are theoretical. For all the promises of reach and responsiveness and pay-per-performance efficiency, performance media agency pitfalls abound. Platform-side inventory controls and SSPs work hard to improve ad revenue yields, driving costs upward for advertisers.

This is why performance marketing agencies exist: to act as a necessary hedge against the growing costs and diminishing effectiveness of standardized paid media campaigns.

Often brands are unaware that “Certified Partner Networks” indicating expertise require little analytical training, carry mandatory spend threshold requirements, as well as incentives for growing brand spends. And for Meta and Google, campaign “optimizations” include (almost without fail), higher budgets and no specific argument supporting incremental efficiency as a result.

Marketers should question anything that purports the superiority of a single platform algorithm or dataset. No one – not even Facebook and Google – owns the entire ecosystem, so be wary of single-player buys. And no single impression is of equal value. Therefore platforms like Managed DSPs that claim to offer a “flat CPM” are playing arbitrage with an undisclosed markup on media, or sneaking hidden fees and markups into platform costs.

Additionally, advertisers – particularly new advertisers – are wise to tread carefully when testing AI-driven spend allocations with platform technology like Google’s Performance Max. This is where Google uses every possible ad and automated targeting to deliver as much “performance” as possible – without visibility into the targeting or tactics that are performing best. This is problematic as, with proper funnel management, advertisers may be able to slim costs and grow audiences over time. PMax cannibalizes other campaigns by acting as a single, “uni-campaign”. Over-reliance on tactics like Performance Max can deprive marketers of transparency and control over outcomes.

When lifetime value is taken into consideration, all conversions are not created equally; Criterion Global works to combine performance marketing strategies with business-side intelligence for ideal customer acquisition. This process involves merging internal insights + data on sales volume, profitability, and cost-of-goods considerations so that our clients can work toward growing customer lifetime value and make the decisions needed to grow long-term.

In a world of “walled garden” platforms, we deliver results for consumer-facing brands as disparate as Fast Fashion, where trends change instantly and production must scale to meet demand – to Global Hospitality, where pricing must adjust competitively and dynamically on a day-to-day basis.

Performance media buying uses automated algorithms to aggregate, target, bid/purchase, and analyze/optimize digital media buying, algorithms are nothing but problem-solving operations or rules. Without experienced media planning to establish rules, measurement, and strategy, performance media buying simply accelerates the burn rate of wasteful spending. Or unwisely makes recommendations like over-optimizing on the lowest end of the funnel. (Should you put 100% of your investment into retargeting? Only if your goal is to win zero new clients.)

In media and in life, failing to plan is planning to fail.

Here are our Free Matrix Criteria for marketers seeking a Performance Marketing Agency – no email signup required:

• How do you structure your payment model, and what fees are involved? (Percentage of media spend, a flat fee, or performance-based compensation, etc.)?
• Can you provide examples of how your payment structure aligns with your philosophy on customer acquisition? How do you ensure that your incentives are aligned with driving successful outcomes for our business?
• How do you approach customer acquisition strategies, and what methodologies do you use to target and engage our ideal audience? Can you share case studies demonstrating your success in customer acquisition for similar audiences, business models, or tactics relevant to our business?
• What is your approach to measurement, given “walled gardens”, in light of our performance marketing needs? What level of transparency can we expect in terms of campaign performance and spend?
• How do you manage relationships with major platforms, such as Google, Facebook, or other key advertising platforms? Can you outline your process for staying up-to-date with platform changes, updates, and best practices? Do you, or have you in the past 3 years, received any incentive from any platform for growing client ad spend?
• How do you handle media buying and optimization across different platforms? Do you have a proprietary technology stack, or do you leverage third-party tools to optimize our campaigns effectively?
• Can you explain your strategy for ensuring brand safety and combating ad fraud across major platforms? How do you proactively monitor and address potential risks to our brand reputation?
• How do you foster open communication and collaboration between our team and yours? What level of involvement can we expect in campaign planning, strategy development, and ongoing performance reviews?

Book a free 30 min call to get our answers to these questions, and if we’re the right performance marketing agency for your brand.