Prediction: in the near future we will see dollars shifting from performance media into brand marketing and the outcome will be surprisingly good

In 2008 I experienced first hand the biggest shift in recent marketing history: the rise of performance media. I was studying communications, dreaming about becoming a copywriter and creating campaigns that would become entrenched in my generation's culture. One day at a party, a friend asked me if I wanted to write ads for Google “you know, those yellow things that show up on the top of the search?”. I took the job. My goal was to hit 20x ROI in a retail account. That meant that if I sold 20x what my team spent on media, I got a bonus.?

If this was 2022 and not 2008, that story would sound like a joke. Performance media is super expensive now, or, technical term, saturated. A word on Google can cost up to 1.000x more than what it did back then. Online media Inflation is higher than gas Inflation in the same period. Why is that? Because all the money is jammed at the bottom of the marketing funnel.

Back then I underestimated building a brand because the definition of branding I was taught was “branding is every marketing investment that is not directly linked to a sale”.

But then I started working with branding, with both Brazilian and international clients, and worked with over 200 marketing teams across every industry. Turns out I was making money for my clients! I had the proof right there, I saw that branding brought financial results but I couldn’t answer a simple question: How can we measure it?

The truth most people can’t see is that you must build a brand in order for the performance media to work. When that’s not the case, companies enter in a transactional communication mode that is not the best experience for consumers because it lacks meaning and bonding. People choose products not only by the features but also by what they mean to them. Performance efforts shouldn’t be actual efforts, the consumer should have made up their mind by the time of the purchase.??

We are not doing this as an industry because marketing is broken in two parts. The performance math people with all the engineers on one side and the branding and creative people on the other. They sometimes don’t like each other and, when they do, they don’t speak the same language. Branding people are tired of showing up to monthly results meetings with no charts, some social media print screens and a lot of gut feeling.

Successful companies are heading to a future where brand and performance marketing are under one strategy and every effort mixes brand power and performance. For that to happen we need metrics and insights to make good messaging and budget decisions. Let’s recall that companies spend up to 20% of their revenue on marketing. It’s a lot of money and not knowing the outcome of even the smallest line in the budget is a costly mistake.

With the mixed influence of behavioral economics and data science we can make sense of consumer decisions and feelings, and correlate it to business results. That needs to be done every day, not once a year - as traditional marketing research was made in the past.

In the future, every marketing team will make sure they are building a strong brand that also performs well, marketing budgets won’t be in the dark, and companies will have a different relationship with society, not only transactional but also meaningful.

This article was originally published in Portuguese at Mundo do Marketing in Nov 30, 2022

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Guta Tolmasquim is CEO at Purple Metrics, a consumer research and marketing metrics startup and is also the founder of the biggest branding agency for startups in Latam, Brand Gym.