• by Laurie Sullivan , May 27, 2020

Fifty-one percent of advertisers, 32% of agencies and 37% of media companies participating in a Kantar survey do not feel confident that they know and deploy the correct balance of performance marketing and brand building to remain profitable.

The long-term effect comes from the brand’s equity, while the short-term effect comes from quick campaigns or pay-per-performance.

Ninety percent of marketers do understand the important of balancing short- vs. long-term marketing investments. The challenges are found in the pressure to deliver quarterly results, campaign optimization, and return on investments, which leads to building less long-term brand profitability and missed opportunities to spur growth.

“Brands need to have a balance, but we see campaigns today skewed too much toward performance marketing because this gives them immediate payoff,” said Satya Menon, managing partner of brand and marketing for ROI at Kantar.

She said marketers must consider media that also provides a long-term impact and is long-lasting, not just a short-time reward -- and keep that in mind when mixing media buys. Some 68% of marketers said balancing the impact is important, compared with 24% who said it is moderately important and 7% who said it’s not important.

Search, display, trade shows, and print have some of the highest short-term impacts, while television, paid social, sponsorships and public relations have the highest long-term impact.

Understanding the dynamics of how marketing channels generate short- and long-term sales growth is important to ensure that marketers deploy the right mix of brand building and performance media.

This also enables marketers to demonstrate this delicate balance to financial teams and executive leadership -- and ultimately to be more successful in allocating their budget enable growth. This requires a Total Marketing ROI approach to optimization, according to the findings.

Some brands have a more difficult time finding the balance, such as consumer product goods companies that sell frequently purchased items. Automotive is generally more concerned with short-term gains rather than long-term brand building.

While there is always an exception to this approach, marketers in these sectors don’t often think about what the brand stands for -- brand love, she said.

“Television, paid social and sponsorships do well to build long-term effects,” she said. ‘If you had only the short term, the optimized mix should skew toward promotions and search, but you’re ROI would be lower because there’s no lasting effect.”