What's Old Is New Again?

Photo by Luemen Rutkowski on Unsplash

“How many times have you seen an ad on social that leaves you baffled as to what it was for? What is that brand? Was there even a product featured? What was the point? But such a strong CTA to buy? Such lack of marketing fundamentals would be unheard of a decade ago.” - Michael J. Miraflor on Twitter as part of a longer thread on digital advertising’s eroded impact. 

I came across the above a few months back and it has stuck with me as a truism about a lot of what we are seeing from brands today - not just in social, but across much of digital. It got me wondering if this approach for brands is effective and, if not, why it’s continuing to proliferate. 

The Case for Brand Building

To start, it’s worth (once again) revisiting the old short vs. long term brand activation effectiveness discussion. Much of what brands and businesses are exploring through digital and social seems to over index on short-term, conversion-driven content. These ads try to do everything together in a very short amount of time (introduce the brand, explain the product, drive a CTA). While social’s ad maturity and the rise of ecommerce has enabled this possibility, the practice seems to have run rampant. While everyone agrees that some level of short-term, sales driving marketing is necessary and valuable, research suggests that this ‘bothism’ (short and long term messaging delivered together in one format) approach is not the best path for growth. 

In a recent episode of Jon Evans Uncensored CMO podcast, Les Binet spoke on this topic (one that he is largely credited with originating in partnership with Peter Field in their IPA publication, The Long and the Short of It). In the interview, he posited that both short and long term goals can not be effective when condensed into one communication. While there will be some benefits, marketers are better off treating each distinctly. My documentation of his comments is below.

Mark Ritson explored this topic again as well in a recent Marketing Week column citing new research from System1 that confirms much of what’s discussed above. Additionally, it seems to conclude that brand-building efforts are more effective at driving short-term effects than previously thought, giving them an asymmetrical advantage when considering their role in the marketer’s advertisement mix. 

So, the theory is logical, the data is fitting and the experts have been spreading the word. Why are we still seeing such a proclivity to over invest in these indistinct performance marketing only efforts? Surely the allure of new platforms, measurability, ad serving and commerce capabilities contributed heavily to this behavior, but I think the precedent of the previously booming DTC market has much to do with it as well. 

The DTC Influence and Waning Effectiveness 

For years, DTC start-up and scale-up companies relied heavily on cheap ad inventory across digital and social to drive as much growth as possible. As they started seeing success, this may have shaped a lot of the creative conventions we see today and influenced more established brands to try their hand at the same approach. Granted most of these companies didn’t have established brands to lean on and this method felt native to the target audiences they wanted to attract, but we’ve now seen the space get increasingly saturated (read: expensive) and top out in terms of demand. For other brands still following this playbook, the issue may be deeper than misaligned fundamentals - there’s a continued belief in a virtuous cycle within the digital ecosystem that’s no longer churning the same way. 

The brilliant Zoe Scaman summed up this predicament nicely in a recent appearance on Stef Hamerlinck's Let’s Talk Branding podcast saying: 

“DTC for example was almost formulaic for a really long time [...] and now what’s happened is that everybody has realized this formula, everybody is jumping into social ads and the cost of a social ad has gone through the roof. So when it comes to the cost management of DTC, it is no longer tenable. You just literally can't do it anymore. You can't keep your costs low and grow at the same time. So that whole model of build a website, wrap it in a lifestyle, shove it on Facebook - that doesn’t work.”  - Zoe Scaman

Even for digital-first brands that might need to rely on this sort of marketing to get off the ground and build a viable customer base, there is a limit to how long it can maintain effectiveness. Econometrician Dr Grace Kite and Tom Roach have explored this concept and named it The Performance Plateau. As their visual below indicates, they have found that direct response/short-term driving content levels out without proper investment in brand-building activity layered in. 

Rationally, this all makes a lot of sense. There are only so many buyers in the market for a good or service at any given time. You might be able to capture that existing demand, but to create more you have to consistently bring new people to your brand or category. Further, as mentioned earlier, it’s becoming more expensive to even capture the existing demand as platforms become more saturated with ads trying to reach similar audiences. This eventually creates a poor quality environment where many people skip over marketing and remember very little about it. (Or worse, if a brand is deemed to be aggressively shilling an overpriced or culturally out of tune product, today’s social users may de-influence their audiences against you.)

[As a side note, this recent piece from Alex Murrell takes a broad view of how and why most of the consumer space is becoming homogenized and puts forth some strong hypotheses well beyond marketing theory that are no doubt contributing to this state of affairs as well. Worth a read.]

All this discussion begs the question: aside from understanding the value of brand-building content and realizing that over-investing in ‘performance’ activity (particularly on digital) may end up backfiring, how can brands start to realign their efforts toward growth? Recalibrating your messaging philosophy aside, I see a few key areas that can be reviewed and integrated as ways forward toward long-term growth in place of an over-reliance on ‘all-in-one’ performance messaging ads: community, loyalty and memorability. 

What Community Really Means for Brands Today

The term “community” and various concepts around it have been discussed at length over the past few years. Many still consider community to refer to building an audience on a brand-owned platform via social, CRM or other loyalty type program (more on this below). While first-party data collection and integration is going to continue being important, community isn’t the answer to this at scale. For the vast majority of brands, no one is seeking to be a member of a newly propped up, branded community. While some newer social platforms are creating more direct connections to consumers, which can be valuable for certain use cases, I do not believe we are heading into the return of Facebook page fans. Even if we were, the ROI would be limited compared to paid media where the value of reaching new consumers and buyers far outweighs the cost to acquire and retain existing ones within an owned context.

A better way to think about this is what Lysette Jones has coined ‘fragmented fame’ in a recent essay for the IPA. In an age of algorithmic discovery and predetermined content consumption, tapping into or simply targeting interest types and “communities” can go a long way toward building your brand. This sounds simplistic but enacting a strategy to achieve it requires changes, particularly around audience definitions and messaging or content development.

In Lysette’s words: 

“Social media has become recommendation media. It will supercharge Fragmented Fame and has been creating new community groups as people have been finding other like minded folk they had not come across before. Recommendation media will require a shift in audience planning and thinking, a move away from broad brush demographics and thinking about communities based on interests, attitudes and tastes.”  - Lysette Jones

Complementing mass marketing efforts (or for smaller brands, substituting them) with a series of efforts toward more niche, smaller groups can add up and help brands get in front of new consumer types. The key, as mentioned above, is doing so authentically and being creative with your marketing vehicles i.e. don’t just create branded ads, embed creators or sponsorships in organically. 

Redefining the Value of “Loyalty” Tactics

Discussions around Loyalty tactics are often pushed aside as down-funnel afterthoughts. Despite the fact that most established consumer journey models show an arrow looping back to awareness, many don’t consider loyalty efforts (sometimes referred to as ‘advocacy’) as a way to drive new customers to a brand. I think this should change. 

Certainly membership programs, fine tuned offers to existing customers, and CRM more broadly play a massive role in retaining existing customers and driving greater engagement and frequency of actions. However, loyalty tactics should also be thought of as a long-term vehicle to grow a customer base or bring new buyers to the category. Let’s look at a couple recent examples that aim to do this. 

JCPenney has been integrating simple (on the surface) quizzes into their digital experiences to help learn more about their customers and tailor the product recommendations and website experience to their replies. This loyalty-focused tactic accomplishes a couple important things for the brand: 1.) it helps existing customers get to a (somewhat) personalized experience faster, ideally driving more frequent purchase behavior and 2.) It drives first party data to inform future product offerings and promotions for new customers. Even if a program is designed for customers who already buy your brand, the data generated can be leveraged to inform messaging and campaigns that attract new ones too. 

A different, more straight-forward, example is Starbucks’ and Deltas’ recent loyalty program team-up. This kind of collaboration and mutually rewarding experience helps bring customers from each brand to consider the other and encourage preference going forward. While this is a big partnership effort to get off the ground, it is a smart way to acquire a potentially large group of customers. With so many partnerships popping up the past few years being rooted in PR splashes or limited run collaborative product offerings, it’s refreshing to see some big brands tie their efforts to long-term tangible value. 

Strengthening Brand Identity 

Ultimately so much of marketing, and especially brand building, is about fortifying mental availability. Back to the beginning of this article, the balance of this kind of activity compared to short-term activations is currently out of whack for many brands. Looking to big brands though, we see them continue to lean into their ownable assets and focus on creating memorable connections even in a challenging economic environment. 

Just a few I’ve taken note of recently: Lowes building equity in their distinctive red vested employees, Hyundai driving big consideration gains through a name mispronunciation campaign, Under Armour refreshing their well known ‘Protect This House’ campaign, and McDonald’s reducing their famous golden arches down to an eyebrow raise gesture in a recent commercial.

While it is easy to point to these behemoth brands who have been around for decades and say ‘this is the way,’ brands have to start somewhere.  Per the evidence we have, all brands need to be thinking about reinforcing some kind of memorable asset(s) or branding. Otherwise there is a limit to how far short-term promotions alone can take them. 

Where Brands Have Been Is Where They Need to Go Again

So what are brands skewing toward short-term promotions left with in terms of guidance here? Engaging audience affinities, leveraging loyalty and building a distinctive brand…sounds as much like where we’ve been as where we need to head toward. Of course, while the principles may remain the same (for now at least) the mechanisms and landscape to leverage are evolving. There is no clear playbook and variables like brand size, budget, category, competitive landscape, culture, etc. all continue to heavily influence the calculus here. To charge forward, brands should keep one foot rooted in research-based precedent and the other kicking the door down on creative applications of these ‘new’ long-term growth approaches.