Performance marketing is the performance-based advertising where advertisers pay on the base of performance aka leads. It is different from PPC where you charged per click on the advertisement. Instead in performance marketing, you will pay for particular activities. If we see the concept form advertiser side, you will pay the particular amount when the user takes any pre-defined action like user installs the app from your ad or buy a thing or fill up the form and submit details that are the lead for advertisers.
This term generally used in app install campaigns where you are paying for each install instead of ad clicks. This way you can achieve targeted number of installs and publisher will get paid on the basis of same, the installs they deliver. Performance marketing platforms generally provide the stage where advertisers are paying for installs and publishers on the same, getting paid an amount for installs delivery.
This way both parties can manage the targets whether in form of installs or income.
the third party or affiliates (or direct the publishers) have set some tracking codes to track and monitor the conversation that they are delivering and advertisers get controls over targeted regions and other some parameters to optimize the install campaigns.
How is it beneficial for advertisers?
Compare to traditional pay per click or other online advertising platforms, in performance marketing, advertisers only pay for successful leads. so you do not need to depend on conversation ratio and other similar parameters and directly charged for the conversations your campaign gains.
Performance marketing can be used for website traffic, user engagement (in apps), lead generation and even direct sales. This conversation is easily trackable and scalable that is beneficial for both the parties that is a win-win situation.