The perilous mythology of Brand Marketing for digital products

A perennial debate within the world of digital marketing is the proper and optimal division of attention and resources to brand marketing relative to direct response marketing. But the definitions for both of these concepts are generally fuzzy: “brand marketing” is often interpreted deductively by marketing teams as, “all marketing activities that aren’t immediately measurable,” and thus it exists as whatever isn’t classified as direct response. That’s obviously misguided: brand marketing fulfills a very specific purpose and should be activated for that reason.

David Ogilvy, in Ogilvy on Advertising, discusses brand imaging with the following:

You now have to decide what ‘image’ you want for your brand. Image means personality. Products, like people, have personalities, and they can make or break them in the marketplace. The personality of a product is an amalgam of many things — its name, its packaging, its price, the style of its advertising, and, above all, the nature of the product itself. Every advertisement should be thought of as a contribution to the brand image. It follows that your advertising should consistently project the same image, year after year.

Extending this framing of brand image, one might define brand marketing as any activity that inculcates within the consumer a particular brand’s personality. The purpose of brand advertising, with that in mind, is to differentiate one brand from others such that consumers prefer it when confronted with the choice. In Brand equity on mobile, I discuss the concept of brand equity, which is the quantified value of a brand, measured across two vectors of consumer impact: 1) the ability for a brand to charge a price premium given consumer familiarity and receptiveness, and 2) the degree of amplification that a brand bestows upon a firm’s advertising activities (a sort of advertising effectiveness premium).

Direct Response marketing is a wholly different undertaking than Brand marketing and fulfills a different objective. Direct Response marketing is almost exclusively accomplished through digital advertising for digital products, and its purpose is to foment an impulse on the consumer’s part to immediately purchase or otherwise engage with the product. Ideally, this opportunity is guided through audience and intent targeting such that the advertisement collides with need or desire at an appropriate time and results in an outcome for the advertiser (known in advertising parlance as a conversion).

The promise of brand marketing is that, by creating presence of mind within a consumer for a particular product, the purchasing of that product becomes habitual on some cadence; for instance, whenever a consumer is in the market for new shoes, they default to a particular brand because of some affinity for it that has been cultivated through brand advertising (and, obviously, product satisfaction). The promise of direct response marketing is that, given adept targeting, it can produce a purchase immediately, exploiting existing demand and creating the opportunity for the consumer to engage with the product.

The recognition of these divergent objectives often causes conceptual definitions to break down or become blurred within organizations. Both of these tactics — Brand marketing and Direct Response marketing — can fit into a broader performance marketing strategy that applies a deliberate measurement framework to advertising spend and other marketing activities to derive a profitability estimate (or, at the very least, to measure profitability and general performance ex post). This is the straightforward essence of performance marketing: it’s an approach that necessitates, and is informed by, a measurement framework.

I attempt to broadly characterize performance marketing in What is performance marketing? with:

To my mind, performance marketing is a commercial framework for operating marketing campaigns that requires quantitative assignment of their measured or imputed value. In other words: performance marketing dictates that any dollar spent on a marketing campaign should have a clearly understood, assessable, and measurable goal attached to it. The tools and processes used to activate this framework could be specific to an industry or even an individual firm, but the general operating principles and stated marketing objectives would be the same: that some credible assumptions about how a marketing campaign will perform are used to inform that campaign’s construction and deployment and then later assessed and revised with performance data.

What primarily causes the confusion that leads to inappropriate investments, bad incentives, and structural inefficiencies within marketing organizations is the notion that Brand and Performance marketing sit at the same hierarchical height. But they don’t; while Brand can be considered an alternative strategy to Direct Response marketing, it isn’t the diametric opposite of Performance marketing. Brand and Performance marketing aren’t both taxonomy categories; Performance marketing is a category, and Brand marketing is a tactic that can sit within the Performance marketing category.

As I’ve argued numerous times, the misconception that Brand marketing sits in opposition to Performance marketing creates misalignment and confusion that can result in a Brand function that exists in parallel to a Performance marketing team. Optimally, the Brand function should sit within the Performance Marketing team and be guided by a unified measurement model. Again: there is no “opposite” approach to Performance marketing. All marketing should be informed by performance measurement.

Further confusing the organization of this hierarchy is the reality of a third performance marketing tactic: Delayed Response marketing. If Direct Response marketing attempts to produce a reaction from a user immediately, Delayed Response marketing attempts to produce a response at some point in the future where an immediate response is impractical.

The canonical example of Delayed Response marketing is a billboard or bus stop advertisement for a digital product like an app: the consumer that is exposed to this ad might not be in a position to open their phone or laptop and begin interacting with the advertised product immediately, but the ad aims to inspire that behavior as soon as the consumer can.

The conceptual differences between Direct Response marketing, Delayed Response marketing, and Brand marketing are rooted in intended outcomes:

  • Direct Response marketing seeks to catalyze a consumer’s interaction with a product immediately;
  • Delayed Response marketing seeks to catalyze a consumer’s interaction with the product as soon as possible;
  • Brand marketing seeks to increase the consumer’s likelihood of engaging with a product when next presented with the opportunity to do so.

These differences relate to intent and proactivity. And this is ultimately the crux of marketing strategy for digital products: brand marketing should be the dominant strategy for a product, like a CPG product, when a purchase takes place in a retail setting on a timeline that is dictated by the consumer. Consider here, for example, the cadence of buying groceries: the consumer determines that a need exists (empty cupboard) and travels to a storefront (a grocery store, or a grocery store’s app) and is confronted with multiple options for specific products (milk, cereal, etc.) for which brand imaging might influence the purchasing decision. It is in this case that brand marketing is the only suitable way to motivate a purchase given a competitive landscape for a category of goods.

Now consider a digital product like an app. Unlike trips to the grocery store, visiting an app store for the purpose of discovery is simply not a routine habit of most consumers — there is no regular, habitual cadence for opening an app store. Also, the “storefront” for apps is a competitive environment in which potentially thousands of options contend for a consumer’s attention. The purchasing environment for digital products is far different from the retail environment for CPG products; the primary means of inciting purchases for digital products is Direct Response marketing, followed by Delayed Response marketing, with Brand marketing serving as a support system for catalyzing the performance of both of those tactics.

The misclassification of Brand marketing as a general marketing strategy for a company and not a tactic that is deployed within the framework of Performance marketing can become problematic in a number of ways. The first is that the Brand function, seeing itself as the dominant driver of marketing activities, becomes very rigid in what it allows to be used in creative assets for digital advertising campaigns. The effect of this control can be stultifying: the brand team rejects any experimental or exploratory creative concepts for use in direct response advertising campaigns on the basis that they are not “consistent with the brand,” and as a result, digital advertising expenditure diminishes.

Another potential source of friction is access to budget. A brand team, sitting outside of the Performance Marketing umbrella and thus unencumbered by measurement and profitability constraints, might usurp budget for use in brand building and brand reach campaigns that aren’t tethered to any performance requirements and thus the justification for which is unfalsifiable. If these two teams are considered to be of equal prominence, with the Brand team essentially existing outside of any measurement framework, then budget allocation decisions can deteriorate to, “the Performing marketing team must prove the need for budget, but the Brand team should be given the benefit of the doubt because brand impact can only superficially be measured.” This is obviously dysfunctional.

Ultimately, the optimal configuration of a marketing team for digital products utilizes Brand marketing as a means of improving the efficiency of direct response marketing activities. Digital storefronts are wholly, fundamentally different from retail storefronts, and brand recognition and affinity can be capitalized on for digital products via the improved performance of direct response advertising campaigns. But building brand awareness and affinity for digital products is a poor use of resources for most digital products: the cadence of purchasing is irregular, dictated by immediate and unpredictable need, and the product landscape is often too competitive to establish a price premium (especially since most digital products are distributed on the freemium model). Direct Response marketing is the superior path to distribution and consumer adoption for digital products, and it can be made more efficient with Brand marketing support.