Over the last couple of years, marketers have leaned heavily into performance marketing and less into brand marketing. Regardless of why they’ve made this switch, the results haven’t been great – this short-term solution has caused some brands long-term problems.
What is performance marketing?
Focused solely on hitting explicit and measurable goals, performance marketing goes after metrics like cost per acquisition, return on ad spend and conversion rates. Because certain channels have excelled in hitting these goals and are able to show direct attribution toward them, search engine marketing, paid social and programmatic marketing have been marketers’ go-tos. With their transparency, responsive optimizations and ability to deliver against lower-funnel goals, these three channels have taken over performance marketing plans – and to the great benefit of several verticals, including retail, consumer packaged goods, quick-service restaurants, retail and hotels.
What is brand marketing?
This strategy builds brand recognition and value with your audiences while focusing on delivering long-term campaign outcomes and creating future brand value. With goals that often include reach, brand awareness, brand lift and brand sentiment, these efforts tend to not have the immediate impact that performance marketing does, transcending the products that the brand is selling to generate something bigger and more enduring: brand equity.
When budgets shrink:
Historically marketers have struggled to attribute results to their brand marketing efforts, making those budgets vulnerable when cuts are being made. While understandable, cutting brand marketing can create an impact with surprisingly deep and long-lasting effects. Brands may see immediate results, like a sales spike, but that result can be deceiving, as this often is from people already in the consideration phase instead of net new consumers being pulled into the consideration set or sales cycle.
According to an Adweek panelist, not only do you risk losing long-term results by overinvesting in performance media, but when there are economic downturns, a brand’s ability to rebound is significantly impacted. Companies that abandon brand marketing can take three years to recover, while those that maintain it can rebound in as little as nine months.
Our recommendation:
Stay the course with brand marketing even when budgets are getting squeezed to avoid undermining any performance goals you have for the future and to drive brand equity and sustained, long-term growth. Thanks to the evolution of attribution tools, as well as measurement advancements and realistic goal-setting, marketers can now show tangible results from brand marketing in real time, allowing them to make the case for maintaining brand budgets alongside performance budgets.
