Commentary
Branding With A Purpose
- by Dave Morgan , Featured Contributor, April 7, 2016
Why do so many in our business see brand advertising as mutually exclusive to sales-measured marketing? Peter Drucker certainly wouldn’t. His writing on the subject is clear. The purpose of marketing is to create customers. Full stop.
Why then do we so often find ourselves tiptoeing around, afraid of offending folks doing “branding” when we want to talk about measuring sales outcomes on a brand-advertising channel like TV? Because, as we well know, for many in the world of brand advertising, the idea of being held accountable for provable sales ROI is sacrilegious. To them, making brand advertising accountable for sales is to demean it as a direct-response technique.
There isn’t a question that all advertising is now becoming accountable at the sales-response level, even TV. There is a long list of companies doing that today, from Nielsen, with ITS NCS and NBI products to TiVo’s TRA, to Comscore/Rentrak to Neustar’s Marketshare Partners to Oracle’s Marketing Cloud to Marketing Evolution to Analytic Partners -- and many, many more. Since this is now happening everywhere, does the growing focus on sales outcomes necessarily have to create tension with marketers looking to run advertising that helps them grow their brand?
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It does not. For some marketers, it’s just a question of the time horizon in which they expect the sales payoff to occur. It might be over a matter of years, not just a matter of days and weeks. That is how the CMO of one of the world’s largest packaged goods companies told me that he views the ROI of his “brand” advertising.
At the very least, it should mean that everyone in a brand-advertising exercise understands the ultimate goal of their work: to create customers. As a fellow marketing-technology entrepreneur tweeted on the subject earlier today, it’s about “branding with a purpose.” I really like thinking about it that way, because it’s hard to imagine a truly appropriate goal for a branding exercise that is focused on anything but driving a sales-outcome purpose. Can you?
You raise an interesting point, Dave.
I think that one major area of confusion concerns the way branding advertisers look at each ad exposure relative to how direct response advertisers view it. To the latter, every "contact" with a consumer is intended to produce an immediate---or almost immediate---response, namely some direct action like actually buying the product or trying to get more information as a prelude to such action. Naturally direct response advertisers are acutely concerned with targeting precision and how rapidly their response rates wear out and naturally they are thinking short-term, always testing new channels, platforms, etc. In contrast, the branding advertiser, so commonly found on national TV, is not expecting every ad exposure to generate an instant response, particularly as few of these advertrisers sell direct to consumers anyway--they use stores, dealers, franchisees, etc. to do that for them.Which is not to say that branding advertiser brand management is not held accountable by the top brass for the results---generally sales---that are generated by their campaigns. They are. However that's the basic difference between branding and direct--the word "campaign" as opposed to" immediate". Or long-term vs. short-term.
One of the main reasons why we are having so many debates about the merits of "attribution", programmatic TV time buying, targeting to avoid "waste", etc. is rooted in the distinction between the direct response advertiser's outlook and that of the branding advertiser. The former strives to minimize "waste" and is seeking to maximize short-term sales or sales related responses, relative to dollars spent. The latter is trying to motivate consumers over the course of an evolving campaign, to be aware of a brand and be interested in buying it. We should remember that a typical branding campaign, involving a specific positionning stratyegy, lasts about three years not a few weeks. As it develops, there is a stage where awareness and motivation builds, followed by a slowing down of awareness, but not neccessarily of sales momentum and, finally, a stage where sales beging to decline or go flat---which is when a new campaign is developed.
A final distinction concerns targeting. Your typical branding advertiser is not only trying to target those who are immediately "in the market" for a product or service but also a much larger group that might be so motivated over time. This includes current brand buyers as well as those who favor rival brands and newbies to the product category. Which is one reason why the TV targeting mechanisms used by so many branding advertisers are so broad. Unlike their direct response counterparts, the branders are not so certain of who might and might not respond to their ad campaigns as might be believed.
Branding is the new pretty name for image messaging. It takes longer than the "do it now" ads. They both have their place (marketing - sales at Penny's or no sales at Penny's, radio or newpaper) and for many products/services it is a combination (or not - financial advisory sales). Features and benefits, features and benefits and customer service, product quality, availability contribute to sales. Without them, the data and research are nothing more than data and research.
I have been involved both, in the "branding" (which by the way is NOT a new pretty name for anything) and "direct" advertising areas. The only people around which we need to tiptoe are ill-informed mediocre professionals.
Among real pros, first, Ed's "time horizon" reasoning is true. A Colgate or a Coca Cola think of the time horizon, of course. But there are two other "branding" goals that are as important and that I think all intelligent marketers understand everywhere:
1. There is the issue of creating preference over repeated transactions. So that the advertising does have both an immediate (see the description of STAS in "When Ads Work" by John Phillip Jones) and longer lasting effect of creating preference over time. So, for example, if you are personally responsible for about 12 tubes of toothpaste a year, Colgate advertising is geared towards your choice at every purchasing occasion.
2. There is also the important factor of building premium pricing. Branding advertising is not only pretty images and nice music, for many products it includes demos, reasons-why, USP's and more. Why? Because we are trying to create the willingness of the buyer to pay a bit more. So, would you rather have "Acme" toothpaste or "Colgate" toothpaste. In spite of the insorads by store brands (the Acme's) there is still a healthy preference for the branded product, that's the result of branding advertising.
Frankly, the only people that I see getting defensive and thin-skinned about conversations like these are bad professionals who don't undertand all the different metrics.
For a fairly long stretch, advertising was so powerful that it could often enable a mediocre product to win against superior products. A savvy marketer with deep pockets could rig the game through better distribution, a bigger ad budget, and splashier ads.
In that world, bigger and splashier and less eager to make a sale today made sense. It worked, and it was also a lot of fun.
Today, it's much harder for a mediocre product to win through brand advertising because reviews and word of mouth are just a click away. The problem for marketers faced with mediocre products is that DR won't work well -- and neither will old-school brand advertising. BUT smart marketers also know that DR will bring the day of reckoning sooner. There's an incentive to push for less accountable advertising because accountability would not be a good career move. Better to stall and let the next brand manager deal with reality after you have moved on.
In brief, the major accountability CMOs should be pushing for is at the product level. Waiting to fix things by rigging the game through advertising is no longer as good an option as it once was.
Great points Tom. It's one of the reasons that investors in start-up web services like Fred Wilson of Union Square push back hard on their companies who want to spend money on external marketing early, preferring to know whether the product can succeed or fail on its own.
Marcelo, I don't disagree at all with your points. Nor do I believe that they are inconsistent with a focus on holding all advertising including brand advertising accountable at the sales level. Repeat sales can be measured at the person and household level as can price and promotion elascticity and both can now be matched to virtually all ad impressions, from TV to digital to print. I'm not advocating for DR advertising. I'm advocating for full sales accountability of all advertising.