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Performance Marketing vs. Brand Marketing.

Updated: Jan 18

Should you focus on one or the other?


Achieving success in marketing requires a strategic blend of performance and brand marketing, each offering unique merits for short-term revenue and long-term brand growth.

 

But keep in mind before embarking on any marketing initiatives, founders and business owners must prioritize the development of a robust brand identity and align their visuals with their brand character. Without a clear understanding of who you are, where your audience are to be found, and how to communicate with them, any marketing effort becomes a wasted investment.


Picture source: Pexels.com


In this blog post, we delve into the core of both Performance Marketing and Brand Marketing and how both strategies can be combined for optimal results.


What is Performance Marketing and what are the pros and cons?


Performance marketing adopts a data-driven strategy to target customers and drive sales. Leveraging various digital channels, including PPC (Paid Per Click) advertising, social media, influencer marketing, email marketing, ad retargeting, and SEO, it delivers immediate and trackable results. The digital nature of performance marketing enables data-driven optimisation, such as split testing in email campaigns, to enhance overall effectiveness.


  • Pro: Works throughout the customer's journey, converting interest into sales. For example, sequential storytelling through emails can guide leads from the top to the bottom of the funnel.

  • Con: Requires unique ads for each stage of the customer journey, contributing to ad spend uncertainty and difficulty in measuring the impact of top-of-funnel ads.

  • Pro: PPC campaigns offer a direct connection between ads and purchases, allowing for precise measurement and adjustments based on real-time data.

  • Con: PPC advertising can be expensive, particularly with high-cost keywords, leading to a quick depletion of the budget, and the results are short-term.

What are the pros and cons of Brand Marketing?

Brand marketing centers on cultivating enduring relationships with customers, targeting the total addressable market (TAM). While challenging for performance marketers due to the lack of a direct data connection, brand building focuses on long-lasting impact. Tactics include consistent branding across channels, customer-focused apps, enhanced customer service, social media engagement, and multimedia advertisements.

 

  • Pro: Builds strong brand recognition, making your company more appealing to buyers who prefer products from trusted brands.

  • Pro: Long-term brand awareness leads to sustained business success. While it takes time, the results are enduring, creating a trustworthy brand name.

  • Con: Difficulty in pinpointing the exact element contributing to success, making it challenging to replicate results in future campaigns.

  • Pro: Brand marketing can also boost short-term results, contributing to both immediate and long-term business success.



One strategy isn’t better than the other, by integrating the immediacy of performance marketing and the longevity of brand marketing, you get a powerful approach for both short-term gains and sustained brand growth.



Finding the right Balance is the key.


McKinsey points out that the industry has developed a dual personality, relying on both traditional and data-driven approaches. Focusing solely on one strategy can lead to a skewed perspective, such as a brand marketing plan overlooking valuable opportunities. Combining brand marketing and performance marketing within your channel strategy, as recommended by McKinsey, has shown to yield superior results.

 

According to McKinsey, it's time to shift from the dichotomy of performance marketing vs. brand marketing and instead strive to find the right balance. Researchers Binet & Field contribute valuable insights, suggesting a balanced allocation of resources with a 60-40 rule — spending 60% on brand building and 40% on performance marketing campaigns. While the exact ratio may vary across industries, this approach underscores the importance of integrating both strategies for maximum effectiveness.


In essence, the key takeaway is that a full-funnel approach, harvesting existing demand through performance marketing while simultaneously planting seeds for the future through brand building, is vital for sustained business success.


Do you want to know more?

Are you interested in knowing more about Performance Marketing and how our team of strategists at See you next Tuesday Studio combine both strategies? Or are you interested in learning how you can implement our approach?



Visit our website here and book a free consultation call.




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