Growth Marketing vs Performance Marketing: Which One to Choose For Your Business

Your board wants measurable growth this quarter. Your team wants a long term brand engine that pays off next year and beyond. Somewhere between those two asks, you keep bumping into the same question: which marketing strategy should we actually invest in?

In conversations with CMOs, municipal communications teams, and founders, we see the same tug of war. Performance campaigns promise quick wins, tracking every click and conversion. Growth programs take a wider view: product, messaging, retention, referrals, and everything that happens after someone first discovers you. If your budget, team, or timeline is tight, choosing the wrong approach can leave you with pretty dashboards and very little real revenue or, just as frustrating, a strong brand that never quite scales.

TL;DR:

• Performance marketing = highly measurable, channel specific campaigns (search, social, display) optimized for short term conversions and ROAS.
• Growth marketing = cross channel, full funnel strategy that blends acquisition, activation, retention, and referrals to grow LTV and revenue over time.
• Most organizations need both, but at different levels of emphasis depending on maturity, budget, and goals.
• Use the checklist below to decide whether to lead with performance, growth, or a combined model.

What is performance marketing?

Performance marketing is any digital campaign where you pay for and optimize toward a specific action. Think leads, purchases, app installs, form fills, phone calls, or even engaged sessions on a key landing page.

Common performance channels include:

• Google Search and Display Ads
• Meta (Facebook/Instagram) and other paid social platforms
• Programmatic display and video
• Shopping and marketplace ads for ecommerce

Here you live inside metrics like CPC (cost per click), CPA (cost per acquisition), ROAS (return on ad spend), and conversion rate. The job is to turn ad spend into measurable results as efficiently as possible. For many clients, this looks like always on PPC and paid media programs tuned weekly or even daily.

For a municipal or utility client, that “conversion” might be a resident signing up for a program, downloading a guide, or using a digital service instead of calling in. For an ecommerce brand, it’s revenue. Different outcomes, same mindset: clear goals, measurable actions, and tight feedback loops.

For a deeper industry overview, this performance marketing guide from WordStream gives a helpful primer on the broader landscape.

What is growth marketing?

Growth marketing zooms out. Instead of asking, “How do we lower CPA on this campaign?” it asks, “Where are we leaking value across the entire customer journey, and how can we fix that?”

In practice, growth work blends strategy, creative, product, and analytics. It might include:

• Customer research and segmentation (who you serve and why they care)
• Positioning and messaging experiments across web, ads, and email
• Conversion rate optimization on your website and landing pages
• Lifecycle email, SMS, or marketing automation to improve retention
• Referral and advocacy programs that increase LTV and word of mouth

Metrics expand beyond CAC and ROAS to include LTV (lifetime value), activation rate, adoption of key features or services, churn, and referral volume. You still care about short term performance, but the real win is sustainable, compounding growth. If you want a second perspective, HubSpot’s overview of growth marketing outlines how this mindset grew out of product led and startup environments.

Growth vs performance marketing: key differences

On paper, performance marketing vs growth marketing can sound like a label change. In reality, they show up differently in your calendar, your dashboards, and your budget.

Neither approach is “better” in isolation. The right question is, “What does my organization need most in the next 6 to 18 months: reliable acquisition at a known price, or deeper growth across the whole customer lifecycle?”

When to prioritize performance marketing

There are seasons where pure performance marketing is the smartest move. A few signs you should lean hard into it:

• You need results this quarter. Maybe council or investors are watching one specific metric. You need a clear story about leads, applications, or revenue in the next 90 days.
• Your service is already validated. You know people want what you offer, and your sales or enrollment process converts well once people show up.
• You have clear conversion goals. For example, “online permit submissions,” “e-bike orders,” or “demo bookings” that can be tracked and optimized.
• Your data foundations are in place. Analytics, pixels, and conversion tracking are working, so you can trust the numbers.

In these situations, dialling up performance campaigns on channels like Google Ads and paid social, supported by focused landing pages, can move numbers quickly. For many Setsail clients, this is where we start building a simple, measurable funnel from ad to action before we widen the scope.

When to prioritize growth marketing

Other times, throwing more money into ads just amplifies existing friction. The signals below point to a growth marketing focus instead:

• Strong traffic, weak outcomes. You’re getting plenty of visitors, but conversion rates are low or churn is high.
• Heavy reliance on one channel. If a single ad platform or campaign carries most of your results, you’re exposed.
• Unclear audience story. Teams can’t agree on who the best-fit customer is, or what problem you truly solve.
• No lifecycle program. Leads go into a CRM and… that’s it. No structured onboarding, education, or reactivation.

Here, growth work might mean running customer interviews, redesigning your website’s key journeys, or building retention flows in tools like Klaviyo or HubSpot. For example, shifting a portion of your media budget into SEO and content can lower blended acquisition costs over time, while lifecycle campaigns help you earn more from each hard won customer or resident.

Growth marketing vs performance marketing: which comes first?

Most organizations don’t have the luxury of a blank slate. You likely have some channels running, some internal expectations, and a finite budget. So which comes first: growth or performance?

Stage and context matter

In our work with governments, utilities, and high growth brands, a pattern keeps showing up:

• New or unproven offers often benefit from a growth lens first: rapid research, message testing, and a small number of tightly scoped experiments.
• Proven services that need scale often benefit from a performance-first approach, with growth work layered in once acquisition is profitable.
• Mature organizations usually need a balanced model: performance programs feeding steady results while growth teams reduce friction and unlock new levers.

One simple rule of thumb: prove you can acquire customers or residents at a sustainable cost, then invest in everything that makes each one more valuable and more loyal.

How Setsail combines growth and performance

At Setsail, we rarely treat this as an either/or choice. Our ROI Framework is built to connect both mindsets so your media dollars and your broader growth strategy stay in sync.

1. Vision Mapping

We start by clarifying who you serve, what outcomes matter most (leads, revenue, enrollments, behaviour change), and how marketing ties to those outcomes. This includes reviewing existing data, talking with your team, and identifying gaps in tracking or attribution.

2. Marketing Lab

Next, we run structured experiments across paid media, creative, and on site experience. That might look like new search campaigns, refreshed ad creative, or A/B tests on critical landing pages. The goal: find out, quickly, what truly drives the metrics that matter for your organization.

3. Scale & Optimize

Once we see what works, we scale winning performance campaigns while investing in growth levers that compound results content, SEO, lifecycle, and conversion rate improvements. Over time, this shifts you from “renting” attention to owning more of your audience and traffic.

If you’d like to see what this looks like in practice, our case studies walk through how we’ve used this framework with cities, utilities, and ecommerce brands across North America.

Checklist: choose the right mix for your organization

Use this quick checklist to decide how much emphasis to put on performance marketing vs growth marketing over the next 6–12 months.

If you answer “yes” to most of these, lean performance first:

• We have a clear, proven offer and sales or enrollment process.
• We can track key actions (form fills, purchases, registrations) reliably.
• Leadership expects tangible movement in a small set of KPIs this quarter.
• Our website and core messaging are stable and not due for a major overhaul.

If you answer “yes” to most of these, lean growth-first:

• We’re unsure which audience segment is truly best-fit.
• People engage with our content or ads but rarely complete key actions.
• We don’t have a structured retention or lifecycle program.
• Most wins come from one channel, and we’d be nervous if it changed tomorrow.

If you’re split, aim for a combined model:

Many teams land here. In that case, we usually recommend:

• Maintaining or launching core performance campaigns to keep results flowing.
• Allocating a defined percentage of budget and time (for example, 15–25%) to growth experiments across web, messaging, and lifecycle.
• Reviewing CAC, LTV, and key funnel metrics monthly to rebalance as you learn.

For a broader framework on balancing acquisition and retention, the growth loop model popularised in the SaaS world offers useful mental models you can adapt to government and service based environments as well.

Common mistakes when comparing growth and performance marketing

Over the years, we’ve seen a few patterns that quietly erode ROI:

• Chasing channel trends instead of strategy. Launching on the newest ad platform without a clear funnel or offer, then wondering why results stall.
• Measuring everything, prioritizing nothing. Dashboards full of CTRs and impressions but no clear view of leads, revenue, or LTV.
• Redesigning the website in a vacuum. Big branding projects that ignore performance data and real user behaviour.
• Treating residents or customers as one-time transactions. No plan to re-engage people who showed interest but didn’t act, or who converted once and never heard from you again.

The fix usually isn’t more tools. It’s tighter alignment between your strategy, your media, your website, and your reporting all grounded in what “good” looks like for your organization.

Next steps

If you’re still weighing growth marketing vs performance marketing, you’re not alone. Most teams we speak with know they need both, but they don’t have the time or internal bandwidth to stitch them together into one clear plan.

That’s where a partner with in house strategy, creative, web, and performance media can help. At Setsail, we work with municipalities, utilities, and high growth brands across Canada and the US to connect every activity back to leads, sales, and long-term growth not just vanity metrics.

Learn more about Setsail, or Get Started with a fixed timeline, fixed deliverable engagement where we map out the right mix of growth and performance for your organization, then put it into action.

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