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Unit 3 of 4 · MBA Sem 3

Unit 3: Performance marketing

Search Engine and Performance Marketing notes · PTU syllabus (MBA 972-26)

3 min read8 topics10 exam questions
On this page
  1. Unit summary
  2. Concept and importance of performance marketing
  3. Conversion rate optimisation
  4. Landing page optimisation
  5. A/B and multivariate testing
  6. Affiliate and influencer performance campaigns
  7. Customer acquisition and lead generation
  8. Funnel optimisation
  9. Attribution models
  10. Key terms
  11. Quick revision
  12. Important questions

Unit summary

Performance marketing pays for results and keeps improving them through testing. This unit covers the concept and importance of performance marketing, conversion rate optimisation, landing page optimisation, A/B and multivariate testing, affiliate and influencer performance campaigns, customer acquisition and lead generation, funnel optimisation and attribution models.

After this unit you can

  • Explain the concept and importance of performance marketing
  • Apply conversion rate and landing page optimisation with A/B and multivariate tests
  • Run affiliate and influencer performance campaigns and lead generation
  • Optimise funnels and choose attribution models

PTU syllabus topics

  • Concept and importance of performance marketing
  • conversion rate optimization
  • landing page optimization
  • A/B and multivariate testing
  • affiliate and influencer performance campaigns
  • customer acquisition and lead generation
  • funnel optimization
  • attribution models
ProcessConversion rate optimisation
  1. 1

    Analyse the funnel

    Where do users drop off?

  2. 2

    Form a hypothesis

  3. 3

    Design variant B

  4. 4

    A/B test

  5. 5

    Measure significance

  6. 6

    Roll out the winner

1

Topic 1

Concept and importance of performance marketing

  • Performance marketing: digital marketing in which advertisers pay for, and optimise towards, measurable actions — clicks, leads, sales, installs.
  • Channels: paid search, paid social, affiliate, display and programmatic, marketplace ads, performance-based influencer deals.
  • Importance: accountability for every rupee, rapid testing and scaling, precise targeting, clear ROI — central to D2C brands, fintech and ed-tech growth.
  • Risks: over-focus on short-term conversions at the cost of brand building, rising acquisition costs, attribution errors.
2

Topic 2

Conversion rate optimisation

Key formulasCRO metrics

  • Conversion rate

    Conversions ÷ visitors × 100

  • Cost per acquisition

    Ad spend ÷ conversions

  • Revenue per visitor

    Revenue ÷ visitors

  • CRO process: research (analytics, heat maps, session recordings, surveys), hypotheses, prioritisation (PIE or ICE scoring), testing, implementing winners, repeating.
  • Common levers: clearer value proposition, social proof, trust badges, simplified forms, faster pages, strong calls to action, guest checkout, multiple payment options.
3

Topic 3

Landing page optimisation

  • Elements of a high-converting landing page: headline matching the ad, clear benefit-led copy, hero image or video, one prominent call to action, short form, testimonials and trust signals, mobile-first layout, fast loading, no distracting navigation.
  • Message match: the landing page must deliver what the ad promised.
4

Topic 4

A/B and multivariate testing

ComparisonA/B vs multivariate testing
A/B (split) testing
Multivariate testing

What changes

One element or whole page versions

Several elements at once in combinations

Traffic needed

Lower

High

Insight

Which version wins

Which combination and interactions work best

Example

Two headlines

3 headlines × 2 images × 2 buttons = 12 versions

  • Good practice: one clear hypothesis, adequate sample size, run for full business cycles (at least a week), check statistical significance (usually 95%), avoid stopping early.

Example

Version A converts 400 of 10,000 visitors (4.0%); version B 480 of 10,000 (4.8%). A significance test (z ≈ 2.8) shows B's lift of 20% is unlikely to be chance.

5

Topic 5

Affiliate and influencer performance campaigns

  • Affiliate campaigns: commission per sale or lead; networks (Amazon Associates, Admitad, vCommission); track with unique links and cookies; watch for fraud (cookie stuffing, fake leads).
  • Influencer performance campaigns: pay per sale using unique discount codes or links, hybrid fees (fixed plus commission), whitelisting creator content as ads.
  • Disclosure: ASCI guidelines require clear labels for paid content.
6

Topic 6

Customer acquisition and lead generation

  • Acquisition channels: search, social, affiliates, referral programmes, marketplaces, partnerships, content.
Key formulasAcquisition economics

  • CAC

    Total acquisition spend ÷ new customers

  • LTV to CAC ratio

    Customer lifetime value ÷ CAC — healthy if 3 or more

  • Payback period

    CAC ÷ monthly gross margin per customer

  • Lead generation: lead magnets, forms, lead scoring, quick follow-up through CRM and sales teams.
7

Topic 7

Funnel optimisation

HierarchyMarketing funnel
  1. Awareness

    Impressions, reach

  2. Interest

    Clicks, page views

  3. Consideration

    Time on site, product views, add to cart

  4. Intent

    Checkout started, lead form

  5. Purchase

    Orders

  6. Loyalty and advocacy

    Repeat purchase, referrals

  • Find leaks: compare drop-offs at each stage; fix the biggest leak first (e.g., checkout abandonment via shipping cost clarity, guest checkout, payment options).
8

Topic 8

Attribution models

ClassificationAttribution models
Attribution

  • Last click

    All credit to the final touchpoint

  • First click

    All credit to the first touchpoint

  • Linear

    Equal credit to all touchpoints

  • Time decay

    More credit to recent touchpoints

  • Position-based (U-shaped)

    40% first, 40% last, 20% middle

  • Data-driven

    Algorithmic credit based on actual paths (default in Google Analytics 4)

  • Beyond attribution: marketing mix modelling and incrementality (lift) tests measure true causal impact.

Key terms

Performance marketing
Paying for and optimising measurable actions
CRO
Conversion rate optimisation
Multivariate test
Testing combinations of several elements at once
LTV to CAC ratio
Lifetime value relative to acquisition cost
Data-driven attribution
Algorithmic allocation of conversion credit

Quick revision

  • Performance marketing: concept, channels, importance, risks.
  • CRO process and levers; landing page elements; message match.
  • A/B vs multivariate; significance and sample size.
  • Affiliate and influencer performance deals; CAC, LTV:CAC, payback.
  • Funnel stages and leaks; attribution models; incrementality tests.

Important exam questions

Practice questions written to the PTU exam pattern for this unit's syllabus: short answers (Section A style) and long answers (Sections B and C style).

Short-answer questions

  1. Q1.What is performance marketing?
  2. Q2.State the conversion rate formula.
  3. Q3.Name four elements of a good landing page.
  4. Q4.Distinguish A/B and multivariate testing.
  5. Q5.What is a healthy LTV to CAC ratio?
  6. Q6.Distinguish last-click and data-driven attribution.

Long-answer questions

  1. Q1.Explain the concept and importance of performance marketing.
  2. Q2.Discuss conversion rate optimisation and landing page optimisation.
  3. Q3.Explain A/B and multivariate testing with an example.
  4. Q4.Discuss funnel optimisation and attribution models.

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