Brand marketing vs. performance marketing

Why this decision impacts everything about your marketing

There are few philosophical stances that will influence everything about your marketing thereafter.

Deciding to prioritize brand versus performance is one of those things.

This is worth discussing with your team:

“If you could only prioritize brand or performance, what would you pick?”

It’s worth getting on the same page about this early. If you don’t, you risk getting push-back and skepticism downstream.

This skepticism is masked as logical criticism or concern.

They’ll say something feels “off.” It doesn’t seem “right.” They might not have the vocabulary to explain.

What they really mean is, “I thought we were more brand-driven (or performance-driven) than this.”

So before you do any marketing or creative work, get on the same page.

“Do we as a team prioritize brand or performance? More importantly, are we comfortable with the trade-offs that come with each path?

Read on to understand the trade-offs, so you can make an informed, deliberate choice.

Performance-driven companies optimize for immediate wins

Some teams are 100% performance-driven.

In general, a performance-driven approach means better short-term conversion, but worse long-term brand equity.

One of my clients was squarely in the performance-driven camp. They did whatever converted well. But in the process, became known for spammy ads and promotional offers.

They sacrificed their brand to get short-term conversion. At a certain point, their customer acquisition cost still got too high. So they wanted to start investing in their brand, in the hopes that it would drive word of mouth and reduce their reliance on paid media.

But once you’re addicted to throwing money at a problem, it’s hard to pull back.

So if your organization skews performance-first, you need the leadership team to be on board with balancing that with a brand-driven approach.

There’s no way around it:

If your default is performance-first but you want to add a more brand-driven approach, all your metrics will get worse in the short run.

Think about it this way:

If Nike sold all their shoes at 60% off, and one day wanted to charge full price, they would see a huge drop in sales.

Brace yourself. Make sure your leadership team understands it will be a rough period.

Brand-driven companies optimize for brand equity

Some teams are the opposite. They are 100% brand driven.

Luxury brands are a good example.

They’d rather burn their excess inventory than sell it at a discount.

Hermès isn’t trying to convert you with their billboard in Times Square.

They are hoping that, with repeated exposure, when you’re able to invest in a statement handbag, you’ll want a Birkin.

A brand-driven approach means worse short-term conversion, but better long-term brand equity.

The downside, though, is you’ll see lower conversions because you’re not doing all the things that normally get people to convert.

They avoid tactics that decrease customer friction:

You have to be okay walking away from short-term sales.

It seems easy to say, “Of course we’ll prioritize the brand.”

But when you’re walking away from a few million dollars in revenue, it becomes a harder decision.

Most people want the long-term brand equity, but aren’t willing to live with the worse click throughs or lower revenues.

So you need a tough stomach (and good cash flow) for playing the long-game.

Can you optimize for both brand and performance?

All of this begs the question: Can you have both brand AND performance? Can I have my cake and eat it too?

Yes. Realistically, most brands have to aim for both:

So most brands balance brand and performance — but doing both well is hard.

For example, we did this at the altMBA.

Seth spent years building a strong brand. We didn’t want to flippantly use hooks that would get clicks but erode trust with his fans.

So we had strict self-imposed guidelines on what we couldn’t do — including almost all the levers typically used to increase conversion.

For example:

When you can’t rely on low-hanging fruit tactics, you have to get much more creative.

You get more creative with messaging, copywriting, visuals, and audience segmentation. It raises the bar.

On the surface, we made it look easy. Behind the scenes, we were ducks paddling hard under the water.

Even if you aim for both, most organizations are still either more brand-driven or performance-driven. I’d say with the altMBA, the fact that we chose to have self-imposed constraints is a sign we prioritized the brand. At the same time, we had ambitious targets for CAC (customer acquisition cost) that meant we were ruthlessly results-focused.

It’s not easy. So yes, you can and should aim for both. But acknowledge you are doing difficult work. Be patient with yourself and know the tension is normal.

When you look through this brand vs. performance lens, what do you think your company leaders would pick? Which are you more drawn to?

Marketing | Product | Strategy | Prev: altMBA, Seth Godin HQ, Flite (acq by Snapchat), Gap Inc. @wes_kao | weskao.com