The Long and Short of it: Brand Building vs Sales Activation

ROAS (Return on Advertising Spend) is the digital equivalent of ROI. Tom Roach speaking on the On Strategy Showcase podcast said "Many marketers are incentivised on ROAS...the problem here is that if somebody has had an opportunity to see an ad over a 28-day period and go on to buy the product then Google and Facebook will take the credit." 

Focusing too much on ROAS can mean over targeting existing buyers, buyers who were going to buy anyway, or even on their way to buy the produce so you get a skewed picture of what's working, and a very inaccurate view of what is actually influencing purchasing decisions.  

Leopard Co marketing guru Aaron Wells has expertly summarised this episode in his blog.  

Binet and Field have been quoted as saying that the optimal split of marketing spend is 60:40 in favour of long-term brand building. Claire Strickett, however, says this ratio is an average, and oversimplification of the huge differences in brand size and strength; market and category conditions, competitor activity, business stage and life cycle, price and the complexity of purchase decision.  

Other factors affecting marketing budgets and allocation:  

• Most start-ups need sales and correctly initially focus on sales activation through digital advertising  

• Big brands have big marketing budgets and can invest in mass marketing such as TV advertising, which is highly effective at brand building, driving market share and, in turn, profit  

• Social media platforms like Instagram enable both brand building 'emotional' advertising with the option to Shop for a product  

• Marketing is still primarily a numbers game. Reach and market penetration, not loyalty has the biggest impact on growth  

• Creativity is in second place as the biggest multiplier of campaign effectiveness. 

This is a hot topic, but it's not a new one. 

Fergus O'Carroll's was discussing the 60:40 rule in the On Strategy Showcase podcast episode 2 in November 2022 but the debate started back in 2007 when Binet and Field published Marketing in an Era of Accountability was published followed The Long and Short of It in 2013. 

For me, the latter was a real turning point in my understanding of how marketing really works. The report was based on data from the IPA databank, which recorded 30 years of the world's most successful brands and campaigns.

My five key takeaways from The Long and Short of it are:

•  Investing in your brand means you can charge more of a premium for your product.
• Long-term, brand-building marketing activity has short-term effects but the opposite is not true (short-term‘ sales activation’ tactics do not have long-term brand or activation effects).
•  A campaign should be built around a creative idea that can accommodate brand and activation elements.
• The optimal balance of brand and activation is around 60:40, although this was later updated in 2018 in Effectiveness in Context and now contains more nuanced recommendations.
•  Emotional campaigns that are highly creative and generate powerful fame/buzz effects produce considerably more powerful long-term business effects than rational campaigns.

What are the main Brand Building channels?  

Brand-building channels offer very high levels of reach and often include emotional messaging, and build long-term emotional affinity. Many of these provide mass marketing and large reach opportunities, but less direct targeting.  

• Television Advertising  
• Outdoor/Out-Of-Home/Billboard Advertising  
• Local and National Radio 
• YouTube  
• SEO  
• PR/Public Relations 
• Influencer Marketing 
• Newspaper and Magazine Advertising 

What are the main sales activation channels?

Sales activation channels are those with the intended purpose of driving immediate sales. These include:

•  Direct Mail
•  Email Marketing
•  Google Ads/PPC Affiliate Marketing (this is like influencer but with the link to purchase)

There are some channels that can do both with the right kind of idea and execution. These include:

• Programmatic Advertising
• Content Marketing
•  Social media channels (Instagram and TikTok)

Layering marketing channels

Some small brands and businesses only activate on digital channels; others flip flop between running brand campaigns then running digital activation. In the On Strategy Showcase Fergus, Claire and Tom talked about running both brand and activation campaigns at the same time.

We see this regularly with our client, the NHS, on the Umbrella Sexual Health service campaigns. We have found the optimal mix is 70% OOH and 30% digital split between Facebook and Google PPC. While we can't measure the impact of the outdoor ads directly, we see a 20-25% increase in conversions in digital activation than if we do not run the outdoor ads.

We've seen similar results on our behaviour change campaigns for Solihull Council, West Midlands Combined Authority and Transport for West Midlands.

The secret weapon that's a multiplier of marketing effectiveness

There's a secret weapon we try to deploy in all of these campaigns that employ both brand building and sales activation. It's a secret so please don't tell anyone. Promise? It's creativity. It's an idea that makes people smile, take a second to think, inspire or feel a sense of pride, awe or togetherness.

An idea like this takes effort. It needs insight. A deep understanding of the target audience. I'm not talking about an observation. I'm talking about getting to the 'why' a person or group of people behave in a certain way or believes in a certain truth.

This kind of creative concept, combined with brand and sales tactics will supercharge your campaign.

Mum's the word 😉

Measuring brand and monitoring brand growth: Share of Search

The effect of brand-building tactics is difficult to measure directly. This is because these effects take time to drop down to the bottom line. It is thought that only 5% of buyers of a category in the market at a given time.

But if your marketing can plant your brand's distinctive assets in your customers' minds, when they come into the market your brand has more chance to come to mind. This is called saliency.

The legendary Les Binet has developed a way to measure brand effects called Share of Search.

Do you know what market share is, right? the portion of total sales generated by a particular brand or product?

And you've probably heard about share of voice? A measure of brand awareness from media spend, buzz and mentions of your brand or product compared to all mentions of all brands in a particular category.

The research goes that if your share of voice is larger than your equivalent share of market, then your brand will grow.

Measuring your share of voice or share of market if you're a small to medium size brand is fiendishly difficult and expensive. Similarly measuring the impact on your brand of brand-building activity is cost-prohibitive for all but the biggest brands.