Before we get into the meat of brand vs performance marketing, before we address the long view versus the short view, let us for a moment contemplate what it is that view is actually of: advertising.
Yes, advertising. It isn’t a dirty word.
It’s existed for as long as there have been sophisticated human civilisations, and maybe even before that. We have forever needed to promote, persuade, prompt someone to hand over whatever currency they had in their togas in order to buy a particular item or service. Brand – from the old norse brandr to denote burn marks branded onto livestock – is only a couple of thousand years old as a term, but the meaning behind it, those collections of thoughts and memories someone had about a producer to denote a certain level of quality – have probably lasted equally as long. It is very human. It’s hard coded into our minds.
Several thousand years later, marketing became way more sophisticated, the money invested in it became quite ridiculous, and then digital marketing kicked in. We found that there were certain things we could measure, whereas that was less easy to do in the past. Metrics, dashboards, all kinds of juicy numbers started ticking around our screens.
Then, because we are human, we started trying to give names to things that probably didn’t need them, but here we are. We start to name the parts. Labels were attached.
B2B. Digital marketing…? No, not digital, let’s drill down further to performance marketing, in fact. Further still! Paid, organic… These all became marketing terms in and of themselves, not part of the whole. And because we started naming the parts, that act in and of itself implied there was separation. Conflict, even.
Suddenly we’re pitching brand vs performance marketing, splitting up marketing into fragments. Scale this up company wide and you have silos and office politics.
But it ought not to be this way.
Brand Marketing: creating demand
Linguistic tricks aside, it’s worth pointing out that a brand does not exist as a tangible thing. You cannot hold it. You cannot see it – and no, a logo is not it either. It exists as a collection of symbols, sensual cues, impressions, opinions only in your customer’s mind.
That means brand marketing is the business of building and refreshing “mental availability” – how easy it is to recall – among buyers. In fact, it’s making sure that a brand surfaces pretty quickly in the mind of someone at the very moment a purchase decision is beginning to take shape: that car, that holiday airline, that CRM software, that supplier. None of this should be entirely out of our hands though, as we can shape them through good strategy and creative thinking.
A clutch of very well-established concepts underscore this point too.
The first concept is the wake-up call that brands grow through market penetration, not customer loyalty – it is the central and unnerving Ehrenberg-Bass finding. Growth can only come from reaching “light buyers” and future buyers, not from squeezing more cash from an already-converted base. It goes against what we convince ourselves as marketers, and it’s not to undermine the importance of retention and churn. This is just one of those annoying facts of life that makes our job harder, too, because it’s hard to find and promote to light buyers and future buyers. They’re not yet reading our newsletters. They’re not following us on social media. How dare they! Marketing is actually hard work.
Most of these light and future buyers aren’t paying much attention to you either. They’re stubbornly indifferent to your brand, as you, dear reader, are to most brands too.
So the job of brand marketing is to lay down memory structures – this sounds wishy-washy in a boardroom, but proven by actual science it’s a bundle of associations, feelings, which get activated when they enter your category.
Brand marketing also works to make a brand’s distinctive assets – those bright colours, comforting shapes, annoying sonic cues, funny characters, typographic quirks – so that recognition happens fast and without much effort at all.
All because this is about creating demand, it takes time. This is not something that shows up in the next quarter’s board report. But it can be measured. Because brand marketing speaks to the whole category rather than slithers of audience segments, it’s measured against things like share of search or excess share of voice. You just have to be in it for the long game.
Think Deloitte, which invests in high-profile brand campaigns by being front and centre at airports, in the pages of the financial press or global business media – broad category reach in all the places that c-suite might easily notice them. Professional services firms like them operate in long sales cycles, with arcane buying groups, so building brand salience reduces some of the perceived risk before any drawn-out process procurement begins.
Excess Share of Voice is the evidence for good brand marketing. Marketing veterans, Les Binet and Peter Field’s work that’s published in numerous IPA studies, frequently demonstrates how long-term effectiveness, correlates strongly with brand-building investment and excess share of voice, though in my experience sometimes this is easy for marketers to follow, but not immediate enough for some of the c-suite to fully endorse, especially in B2B. I get it. It’s worth also saying that strong brand marketing enables businesses, among many other things, to maintain higher prices, survive economic malaise, and spend less on what we’re about to get to now.
Performance Marketing: capturing demand
Performance marketing has quite a few wonderfully nerdy definitions, but let’s just say that for the sake of argument that it is making sure that every pound you spend should produce a measurable result. Leads, sales, enquiries, revenue – something you can point to and say “that happened because of this”. Chock-full of analytics. CFOs love it.
Its channels include things like paid search, paid social, display, affiliate, programmatic, email… you get the idea… and almost always ends with the crescendo of the customer landing on your website and inserting money into your CRM, or so we hope.
If brand marketing is about generating demand, then performance marketing is about capitalising on that demand.
At the heart of it lie cold, hard commercial KPIs: cost per lead, cost per acquisition, return on ad spend, pipeline value and so on. If the numbers don’t hold up, the activity changes – quickly. It’s immediate
Campaigns – and we could argue for half an hour about what we actually mean by that word – are in lockstep with commercial objectives from the outset. There’s no room for vagueness, nor really thinking about the quarter beyond the current.
Targeting is very focussed, and drawn from behavioural data, demographic signals, job titles, because this is a game of efficiency and measurement. Everything is tracked as tightly as your CFO’s wallet.
Attribution may not be quite the dream, but the main ambition here is full accountability around capitalisation on that brand demand: every activity evaluated against agreed metrics.
Now, the marketers of you will realise the good brands do both. Salesforce invests heavily on brand marketing: Dreamforce, outdoor, brand film, category framing – mental availability being built – around “customer success”. All publicly visible. At the same time, it executes extensive performance programmes across paid search, paid social, lead capture. Salesforce is the iconic B2B example, and it didn’t grow by harvesting existing CRM demand as some might think.
Performance marketing is about outcomes; it’s short-termist by design. It deals in results you can count before the end of the quarter. And it is delightfully quantifiable. Perhaps… too quantifiable for there to be balance in the boardroom.
Wait, is all performance marketing actually advertising?
Our CEO commented on LinkedIn with an appropriate post about this very subject recently. In it he shared my points above how advertising, in the Ehrenberg-Bass Institute sense of the marketing world, exists to build memory structures, so a brand comes to the fore of your mind in a buying situation. And it works upstream of “demand”. Demand creation.
Paid search, however, doesn’t build memory. It doesn’t do the job of advertising in the way we understand it now. It captures that intent, once it already exists, and its place in this world is one of “distribution”.
“If advertising builds mental availability, paid search provides digital availability. Advertising makes you easy to remember. Paid search makes you easy to find. They’re both critical. But they’re fundamentally different… If you’re funding paid search from your brand-building budget, you’re likely underinvesting in the activity that actually drives future demand and real growth. Paid search and advertising need each other. But they’re not the same thing. Tell me I’m wrong.”
His final point is something we do on a daily basis, but the rest of that conclusion is the important point to take note of, and therefore we cannot say fully that all performance marketing equates to advertising, even though that’s what we may have always believed.
The Streetlight Effect
So maybe I was wrong at the start of this article, by suggesting this was all the same thing, and it was a linguistic glitch to split things up. Because if you treat both brand building and all performance marketing as advertising, you risk undermining the things that create future demand. Go all-in on performance, or paid, you may rub your hands with glee in the immediate quarters, but next year your hands are pressed against your face as you wonder why those leads have dried up.
The long and short of it is performance marketing makes revenue visible, but brand marketing makes revenue possible.
They’re not either or, they’re totally reliant upon each other as a… I was going to use the word holistic… two sides of the same coin.
Capturing demand and creating demand are not the same thing. You must decide cautiously where you want to invest.
However, we need to be careful about what we’re measuring, and why.
The streetlight effect, or the drunkard’s search, highlights a certain danger on this topic.
A drunken man wonders around having lost his keys in the nearby park. He begins his for them under a nearby streetlight. A policeman spots him, wonders up to him and begins to join in with the search. But after a few minutes, the policeman stops and asks him: “Are you actually sure you lost them here?”
“Ah, no,” says the drunk. “I lost them in the park.”
“So why’re you looking here?” asks the copper.
The drunk man replies: “Because this is where the light is.”
With marketing, and especially in our own subdivisions of marketing we tend to look where the light falls, not where the keys were lost; it is what happens the map starts dictating where the landscape is allowed to be.
And so we are left, perhaps, with this simple provocation: the things that we can count are not always the things that actually count, at any given point in time. Brand marketing and performance marketing are not rivals in some tiresome budget war, seeing teams pitched against each other and strategies in conflict. They are part of a single advertising system, simply viewed from two different ends of time.
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