Something strange is happening; the brand-building tide is turning
The Blogfather digests the latest report from the industry’s bastion of progressive change; WARC, shares a grand, new plan for budgeting from Mark Ritson, and has his customary little bite at a global demonic behemoth.
Both strategic strands are ultimately working for the same end: global domination and the end of the need for the human race. A bit like Amazon.
The Mind Flayer from Stranger Things is a great strategist. He wants global domination but is struggling to get into the market beyond the town of Hawkins. He knows that long-term, he needs to get through the inter-dimensional gate; that’s a work in progress needing prolonged investment. But his strategic nous to spot short-term demonic activation opportunities (such as using a Demogorgon, possessing Will*, then Billy**, creating biomass for his own physical form with rats***, etc.) is that of a genius.
Both strategic strands are ultimately working for the same end: global domination and the end of the need for the human race. A bit like Amazon.
So, he’s struck a good balance between short-term and long-term. A two-speed strategy if you will. And it seems like CEOs of some of the world’s largest brands have taken inspiration from this demonic monster if the latest update from WARC from CMO Growth Council sessions at Cannes Lions is anything to go buy.
WARC’s David Tiltman has recently published an article entitled: Are we seeing a pivot back to brand? in which he highlights growing evidence and trends for brands putting more budget into long-term brand building.
If so, it is about time. The identifying of the need for this happened years ago, due to the great work of Binet & Field. The ‘Godfathers of Effectiveness’ and the creators of the 60/40 rule on long-term/short term budget split have long been informing us that there is a worrying trend for a focus on short-term activation, to the detriment of long-term brand building.
Their 2018 publication, Media In Focus: Marketing Effectiveness in the Digital Era (something we blogged on before) contains a whole treasure trove of informative nuggets, such as evidence for the number of very large brand-building effects falling steadily and continually since 2008.
One piece of evidence held up by David Tiltman is telling: in the U.S, Direct-to-Consumer brands are making a big bet on TV. They increased TV investment by 60% in 2018, according to the Video Advertising Bureau.
Media In Focus is stuffed full with case studies that show that the proof is in the pudding; not least for Specsavers. Their ‘Should’ve gone to Specsavers’ long-term brand campaign (with a strapline that has made its way into common parlance) reaped dividends. They achieved huge revenue growth from media. As Binet & Field state; “it is inconceivable that 20 years of short-term sales activation campaigns could achieve growth on this scale.”
So why have marketers long been loath to commit cash to long-term brand growth (or often, not been able to convince those holding the purse strings to do so)? One key reason is the lack of measurement available for such brand-building. Tiltman’s article makes that point:
“Many marketers feel they lack the tools and the metrics to judge success of their brand activity – for example, an industry-standard definition of brand equity that can be tracked over time. Their question: how do we make our case?”
“Strategy is a decision-making tool. A well-conceived and expressed strategy makes it easy to make decisions.”
It is an understandable point of view, but as a past podcast guest of ours, Rory Sutherland says; the devil is in the wastage:
“In becoming a brand leader, you need not to maximise the efficiency of what you do, you need to maximise your chances of becoming lucky, and that involves a necessary level of wastage. Looks less scientific, but in truth may be the best approach for business.”
Mark Ritson has developed his own plan and approach that echoes, and no doubt has some foundation in, the work of Binet & Field. Mark advocates and talks of the necessity of having a two-speed approach to building a strategy. It helps focus the activity on both Short and Long. And equally, demonstrates that each are reliant on each other.
Zero Based Budgeting is painted as one of the scourges of marketing; a barrier to getting any decent long-term strategies into play. It has its failings, but what’s the alternative? Mark lays into the arbitrary nature of ‘pluck a percentage from the air’ advertising-to-sales ratios, and understandably so.
His plan was born out of reading a piece by Mark Di Somma, about the need for a ‘two-speed’ brand strategy. It was thus that Mark struck on his two-speed brand plan; one that builds the brand while delivering maximal short-term returns.
“A well-constructed brand plan could cross the chasm between short- and long-term horizons, between mass-marketing and target segments, between [Zero Based Budgeting] and brand building. And in doing so it might just help brands to grow, sustainably.”
One of the best definitions of strategy we’ve ever heard was from MediaCom’s Strategy Director, Murray Calder, when he appeared as a guest on our podcast. By way of sending you off with a little bit of further listening to fill your ears with, I’ll leave you with a link to that.
Unto our next meeting.
*This may be a spoiler. Sorry.
** And this.
*** Ditto. Soz.