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Brand or Performance: Where Should You Invest More?

The key for planning media budget lies in balancing short-term performance with long-term brand investment.

When planning media budget and juggling overall marketing objectives, you’re faced with a crucial choice: should you be investing in brand or focus on performance campaigns?  

It's a decision that can shape the future of your brand. While performance campaigns might promise quick sales and immediate results, they don't always pave the way for long-term success.  

On the other hand, investing in your brand can be a strategic move, setting you up for more impactful results in the future. But the question remains: how much should you invest in brand campaigns?  

This is not just about choosing between two different strategies; it's about finding the right balance for sustainable growth and success. Let's explore how to navigate this decision, ensuring you make the best choice for your brand's future.

A balance between investing in performance and brand marketing

The Main Challenges When Searching for the Right Balance

Working with our clients we noticed that one of the most significant challenges is finding the right balance between short-term sales and long-term brand building. It's a practical dilemma: invest too much in performance campaigns, and you might see quick sales spikes, but these can be fleeting and don't necessarily contribute to the long-term recognition and loyalty that come with a strong brand.

Adding to this challenge is the struggle to clearly show the value and financial return of investing in brand marketing. This is precisely where Objective Platform can offer assistance by making the ROI of brand marketing measurable and helping you determine the ideal split between brand campaigns and performance campaigns.

Balancing short-term versus long-term investments from the book “The Long and the Short of It: Balancing Short and Long-Term Marketing Strategies” by Les Binet and Peter Field
Balancing short-term versus long-term investments from the book “The Long and the Short of It: Balancing Short and Long-Term Marketing Strategies” by Les Binet and Peter Field

On the other side, focusing heavily on brand-building can delay immediate sales results. This leads to an essential question: what is the ideal proportion of investment in brand campaigns versus performance campaigns? Answering this is crucial, as it directly affects not only your current sales but also the long-term health and visibility of your brand.

So, How Much Should You Invest in Your Brand Campaigns?  

At Objective Platform, we were eager to delve into this intriguing question, which led us to create the Brand Intel Module. Our Brand Insights dashboards provide a tangible and data-driven approach to informed decision-making. It's not just about understanding the theory; it's about applying it effectively.

Performance marketers traditionally rely on data-driven decisions, while brand marketers often depend on intuition. Our Brand Intel tool seeks to close this gap by offering insights into key areas:

  1. The overall impact of media, integrating performance and brand metrics.
  1. The direct and indirect effects of marketing on sales, equipping brand marketers with quantifiable data for reporting.
  1. The effect of media investments on brand value.
  1. Detailed analysis of brand metrics.

Our Brand Insights dashboard offers a comprehensive view of brand campaigns, brand KPIs, and their outcomes. This data visualisation empowers you to make decisions not based on gut feelings or trends, but on solid, actionable data.

A dashboard view from Objective Platform showing Brand Attribution Insights

To specifically address the question of how much should you be investing in brand campaigns, we'll use a real case to explain further.

Let's imagine Margot, a Marketing Manager at a telecommunication brand, facing a similar dilemma. She has received a budget at the end of the year and is planning to distribute it across various campaigns throughout the year, including both brand and performance campaigns.

She begins by analysing the current state and effectiveness of her brand, focusing on aspects like image perception and customer acquisition. Following this assessment, her next step is to determine which specific goals or targets, known as Key Performance Indicators (KPIs), she will concentrate on throughout the year.

These KPIs are crucial for enhancing the brand's value and might include factors such as ad recall, brand consideration, aided brand awareness or relevant set first choice.

By meeting these KPIs, the brand can positively impact its overall value and enhance the effectiveness of its advertising and media strategies. Put simply, it's about identifying the specific improvements the brand needs to implement to achieve better results from its marketing efforts.

Margot is interested in the brand key performance indicator 'Aided Ad Recall.' She navigates to the Brand Intel section of our platform and examines a graph that displays the level of that specific KPI.

A dashboard view from Objective Platform showing Effects of brand value on media performance result

She determined that the current Aided Ad Recall is 32%.  

However, upon examining her Brand Intel dashboard, she measures that the Aided Ad Recall needs to be at least 44% to prevent her brand from losing money and to avoid a decline in sales.

Consequently, Margot might decide to increase investment in brand campaigns to boost the Aided Ad Recall to at least 44%. This increase is not just about hitting a target; it's also essential for supporting performance marketing efforts.

Remaining at a 32% Aided Ad Recall would result in a loss of 150 conversions due to changes in average media performance.

These are tangible, concrete numbers that Marketing and Brand Managers must consider when planning brand campaigns. The next time upper management demands justifications for investing in brand campaigns, these insights provide a solid answer.

Armed with this knowledge, you can present a clear argument for why investing in the brand is necessary, specifically why increasing the Aided Ad Recall from 32% to 44% is crucial.

A dashboard view from Objective Platform showing the level of Aided Ad recall in a graph

What To Expect When You Invest in a Brand Campaign

After understanding the importance of increasing the Aided Ad Recall from 32% to at least 44%, Margot initiated a brand campaign aimed at reaching this 44% target.

However, it's important to note that 44% is merely the breakeven point. Achieving a higher Aided Ad Recall is always beneficial, as a higher level of this brand KPI leads to more effective media campaigns.

Consequently, after a successful push in brand uplift, the focus of the brand KPI shifted towards maintaining these positive brand levels. It is worth mentioning that this shift also led to a lower CPO for performance campaigns.

A visual graph showing that when brand value drops, cost per order of performance media increases
Example from our Use Case

The graph below illustrates that since June 2022, the Aided Ad Recall has consistently maintained a level of 44%, positively impacting the brand value and enhancing media performance. This consistency ensures that performance goals are met more effectively.

A dashboard view from Objective Platform showing Media effect on Aided Ad Recall over time

Maintaining a sufficiently high level of Aided Ad Recall has a notable positive effect on media performance. Specifically, this translates to approximately 11 to 27 additional conversions per month compared to maintaining a brand level at 44%.

When this is contrasted with the negative media performance at a 32% Aided Ad Recall, the difference in attributed conversions becomes even more pronounced. We observe a significant contrast between -51 and +22 attributed conversions.

A dashboard view from Objective Platform showing what would happen if the percentage of Aided Ad Recall grows

Final Thoughts

In conclusion, the key for planning media budget lies in balancing short-term performance with long-term brand investment. Utilising tools like our Brand Insights dashboard, managers can make data-driven decisions, optimising strategies to enhance brand value and achieve measurable results.  

This approach not only justifies investments in brand campaigns but also paves the way for sustainable growth and success in the competitive market. To explore how our platform can help your marketing strategy, make sure to get in touch with us.

Reflecting on Mark Ritson's insights about brand-building ads boosting short-term sales: Are we entering an era focused on long-term brand development? We believe the answer is a definite yes.