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The Ridiculous Disconnect (between Branding & Sales)

Last updated: September 6, 2018

The Ridiculous DisconnectAny marketer spending over $10 million a year on advertising does so because they know that their brand matters.

Yet, mix modeling and attribution vendors do a lousy job at measuring the connection between brand and behavior, resulting in under‑spending on many valuable brand‑building activities. If a measurement vendor measures brand at all, it is usually only on a superficial indirect trend regression level. In other words, the modeler will take brand tracking trend data and regress it against sales trends. It’s not a direct person‑level connection. The indirect measurement fails to capture the majority of the meaningful relationships between brand and behavior. This disconnect results in brand and DR budgets being planned, managed and optimized separately, and under-performing vs potential.

Mike Eichorst  (SVP at Citibank) says: “We always suspected that brand advertising had an impact on the business in a measurable way, in new accounts, new credit card usage, bank account openings, and deposits. But, we never knew how much. We discovered brand has a significant business impact both in the short and long‑term... So there’s been a tying together of two pieces that have always been very separate in most companies”.

What if you had a way of measuring the “decay rate” of your brand advertising such as that shown in the screenshot below, or understanding which creatives work best for people at different stages of their buying process? 

graph.jpgOr a leading indicator such as awareness or message association that would reliably predict future sales and therefore allow you to optimize well in advance of having the sales data?

Not only would those be powerful tools for your toolbox, but marketers are also getting frustrated because they understand that an optimization that fails to directly connect brand and behavior will result in under‑spending on many valuable brand‑building activities.

For example, brand equity is excluded from Media Mix Modeling (“MMM”), which consequently outweighs lower-funnel activities for driving sales. If a multi-touch attribution (“MTA”) vendor measures brand at all, it is only on a superficial indirect trend regression level, it’s not a direct person‑level connection. The indirect measurement fails to capture the majority  of the meaningful relationships between brand and behavior. MTAs also suffer from cookie deletion, which outweighs lower-funnel and more recent exposures as a result.

So what’s the answer - how does a marketer fix the problem of underweighing the importance of its branding activities, and acquire the tools that connect branding and performance for better optimizations and ROI? Regular readers of our blog are thinking to themselves that person‑level analysis connecting brand perceptions to subsequent sales behaviors is necessary - and they are right!

The marketer should ensure that its platform is able to connect its CRM and sales data to brand perception to data at a personal level. This has been proven to result in a mix optimization that invests more in brand‑building activities, and generates more sales and profits by the end of the first year of implementation. 

After all, isn’t it ridiculous not having your branding and performance activities connected.

Written by Marketing Evolution