In the last couple of years an increasing number of marketers have begun to balance the need to build brand and activate sales at the same time. Large companies such as P&G and Adidas have realised they have overspent on digital “performance” media and are trying to readdress budgets towards a better balance of brand and performance. However brand building can take 2-5 years to reach fruition so it is important for marketers to show that reducing high response activation budgets now to fund slower growing brand building will lead to a better result in 2-5 years. For this reason it is vital that marketers can forecast and wargame long term outcomes to reassure the budget holders.
This paper presents a new long term forecasting tool that builds on many years of learning around how brand building media works. Furthermore we discuss how hundreds of what-if scenarios using this tool covering different brand situations and histories show that:
- The much quoted 60:40 brand:performance spend ratio is not a bad starting point; however in many situations it is the wrong solution
- In some cases it is optimal to spend 60-90% of the budget on performance media even over a 5 year period
- When brand investment is needed it is better to front-weight this over the first 2 years
This work shows that, while in most scenarios brand building commands a greater share of the budget, this is not always the case and it is vital to take into account the brand and its current situation to identify the best route forward.
This paper was published in two parts by WARC. Click below to read the full articles.
