60/40
A businesses has to balance building its brand for long-term growth with creating revenue for short-term operations.
How do you do this?
Les Binet and Peter Field are marketers, research analysts, and efficiency experts who've studied and written extensively on advertising that works. Their book The Long and the Short of It explores ad content and general approach to potential customers.
As for content, they concluded that the more ads lean on emotion, the better they work. These emotion-based ads build attachment with the public. That's branding. Businesses that focus on this type of advertising, they say, make more sales at higher profitability over the long-term.
They also acknowledge that businesses need to occasionally juice sales. Binet and Field recommend a 60/40 split: 60 percent of ads should be big picture efforts at creating a stronger bond with the public, while 40 percent of a company's ads should aim at sales activation.
“Campaigns need to strike the right balance between long-term investment inbrand-building using mass media, and short-term, direct methodsthat stimulate sales. Campaigns that use both in harmony are moreeffective, more efficient and more profitable. Long-term (3+ years)investment in advertising delivers double the profit of a short-termapproach (less than 1year), but investing in both delivers evenhigher returns. At least 60% should be invested in thesebrand-building media with the remainder spent on shorter-termactivation channels to provide a response mechanism to capitalise onthe effects of the brand-building activity.” 1
The majority of messages should build the brand by bonding with the public, with the rest of the messages capitalizing on that brand equity with short-term offers. The Long...Of It is big picture branding that seeks to bond people with a company. The Short Of It is occasional ads for limited time sales activation.
But understand that short-term, “Buy Now” ads don't help a business long-term. Mass marketing to new and existing customers does that.
“Tight audience targeting, whilst desirable for activation, does not help long-term success. Campaigns which reach a mass audience of existing & new customers are more efficient. Brands which target the whole market achieve 3 times as many large business effects than those that focus on existing customers (effects include increased profit, sales, or market share, and a reduction in price sensitivity). Attempting to build deep, loyal relationships with existing customers is less effective than investing in advertising that reaches as wide an audience as possible. Ad campaigns which target new customers report 60% more large sales effects in the first six months alone.” 1
The majority of a company's ads should win hearts and bond with the audience. Then, occasional sales activation ads can successfully encourage immediate purchases. This is the formula that Binet and Field say leads to greater growth and profitability over time.
1. The Long and Short of it, Les Binet & Peter Field
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