Brand versus performance is a false choice, and the split still matters

Nobody sensible argues for one and not the other. The argument is really about sequencing, and about which side is currently paying for the other’s results.

Performance marketing harvests demand. Brand marketing creates it. Run either alone for long enough and the other’s absence shows up in your numbers, usually as a cost you blame on the platform.

What each one is actually doing

A search ad against a category keyword is not creating a buyer. It is intercepting one, and the price of that interception is set by everyone else trying to do the same thing. When your brand is well known, you intercept more cheaply, convert better and get chosen at parity. That discount is what brand work buys, and it is invisible in the channel report, which is why it keeps getting cut.

Conversely, brand investment with no capture layer produces demand you then hand to a competitor with a better landing page. Awareness that nobody can act on is a gift to the market.

The diagnostic

You are short of brand if: cost per acquisition rises every year on flat volume, your branded search is flat while category search grows, you win on price more often than on preference, and your sales team keeps asking for discounts. You are short of performance if: branded search is rising but revenue is not, people describe you accurately and still buy elsewhere, and your site converts badly on traffic that arrived with intent.

Both diagnoses are answerable from data you already have. Share of search against your competitive set is the cheapest single indicator; it moves before revenue does, in both directions.

About the 60:40 number

The widely cited long-run split — roughly 60 percent to brand, 40 percent to activation — comes from effectiveness research on established consumer brands. It is a useful anchor and a bad rule. A two-year-old D2C brand with a working acquisition engine is right to invert it; a twenty-year-old category leader spending 90 percent on retargeting its own customers is not. The direction of travel matters more than the ratio: as you grow, the share that has to go to creation rises, because you eventually exhaust the demand the category generates for you.

How to shift the ratio without losing the quarter

• Fund the shift from efficiency, not from volume. There is almost always 10 to 20 percent of capture spend doing nothing except claiming credit for demand that would have converted anyway. Brand bidding at saturation and broad retargeting are the usual suspects.
• Make the brand work do double duty. The same production can serve a fifteen-second brand cut and a six-second product cut. This is a scheduling decision, not a budget one.
• Change the reporting before the budget. If the dashboard only rewards last click, every brand rupee will look like waste, and the shift will be reversed in month three.
• Hold it for four quarters. Brand effects accumulate slowly and are indistinguishable from noise before that. Deciding in month two is how most attempts die. That is a governance problem, and we have written about it in audacity and tenacity.

The measurement trap

Attribution models are built to allocate credit, not to find truth. Anything that creates demand rather than captures it will be under-credited by design, because it happens earlier, off-platform, and sometimes years before the purchase. That is an argument for using incrementality tests and holdouts, not for pretending the effect is not there. See what ROAS actually tells you.

The practical version

Decide what share of next year buys demand you do not yet have. Write it down with the reasoning. Protect it from the quarterly instinct to move it into something that reports well. Then judge it on leading indicators for a year before judging it on revenue. That is the whole discipline, and it is mostly a test of nerve rather than of analysis.

Where does the 60:40 number come from?

From Les Binet and Peter Field's work for the IPA, published as The Long and the Short of It in 2013, which analysed campaigns entered for the IPA Effectiveness Awards over three decades. Across that databank, the most effective campaigns on average balanced roughly 60 percent of investment in long-term brand building with 40 percent in short-term activation. The authors themselves present it as an average across many categories and situations, to be adjusted rather than copied.

B2B marketing tends to sit well away from it. The B2B Effectiveness Code, published in 2021 by LinkedIn's B2B Institute with WARC and Cannes Lions from 435 B2B case studies, found that B2B campaigns skew heavily towards short-term, rational and tightly targeted activity aimed at immediate sales effects, and that campaigns became more effective with more spend, longer duration and broader media. That supports the argument above: the ratio is an anchor, and the direction of travel matters more than the number.