The False Divide Between Branding and Performance

This either or stance reflects ‘an outmoded marketing funnel.’ But are marketers able to synthesize these varied objectives?

Practically everyone in brand marketing and advertising agrees that barriers between branding and performance objectives shouldn’t exist, while they all agree that this false dichotomy continues to exist. 

Lori Goode, chief marketing officer at Index Exchange, the global advertising marketplace, pins the blame on the stubbornness of traditional thinking about consumer behavior.

“What makes [branding versus performance] a choice are the metrics and the KPIs that brands are looking at,” Goode tells The Outcome. “I view the funnel as truly outdated. I don't think that consumers operate within a linear funnel environment anymore. They're constantly moving in and out of those buckets. So the difference between brand and performance from a consumer perspective is a timescale.”

In other words, science is appealing when everyone’s job depends on demonstrating a clear return on investment. Branding is more nebulous and less firm than performance. Storytelling and affinity are a hard sell to people looking at quarterly, weekly, real-time results.

The idea of viewing the purchase, or marketing funnel through four distinct stages — awareness or discovery, interest or consideration, desire or conversion, action or purchase — dates back to 1898, when Elias St. Elmo Lewis came up with the idea of how consumers are influenced. 

The Awareness, Interest, Desire, Action, or AIDA funnel as it’s more commonly known, certainly owes its appeal to its simplicity. But consumers’ decision-making is often complex, and almost always irrational. Ignoring the circuitous route along the purchase path doesn’t solve the problems advertisers have in forming and maintaining a positive relationship with consumers.

Still, given the long days and months in constructing a campaign, the simplicity of “did consumers convert or not?” is the largest question. Modern marketing and its level of data available to track and target consumers has been historically granular and accessible. As such, the clarity of performance campaigns beats the less tangible outcomes of branding.  

The values and tone of a brand’s marketing comes from the top. And CEOs and CFOs demand marketing performance. Aside from providing clear success metrics, performance promises immediacy in pinpointing whether a marketing strategy worked by delivering KPIs such as sales, leads, sign-ups, or a combination. 

But at a moment when consumers are increasingly intentional about shopping with, and even advocating for, brands that reflect their own identities and senses of purpose, courting performance without a direct —and ostensibly “authentic” —branding strategy leaves a marketer at a distinct competitive disadvantage over time.

“To achieve optimal ROI, advertisers must embrace branding as the key driver for performance,” Mike Hauptman, CEO and founder, AdLib Media Group, a demand-side platform, tells The Outcome. “Focusing only on performance or ROAS will actually drive suboptimal ROAS over the long term.”

Hauptman emphasizes that focusing solely on immediate returns often leads to poorer long-term outcomes. “Studies have shown the profound influence of awareness on consumers, regardless of when they interact with your brand; consumers are much more likely to make a purchase from a brand they are aware of, even if that initial touchpoint was years ago,” adds Hampton. “For instance, Mattress Firm's many brick-and-mortar stores aren't just about making a sale today — they're building a physical presence that keeps the brand familiar and top-of-mind.”

The arguments for linking branding and performance are eminently clear and reasonable. But if logic reigned in advertising —or any aspect where life and commerce and marketing overlap — the issue would have faded long ago.

Ultimately, the evolving forms of media consumption will exact a magnetism between branding and performance silos that reason alone couldn’t.

Goode, the Index Exchange exec,  pointed to the rise of CTV and retail media networks as advertising systems where branding and performance naturally intersect. Both CTV and retail media have their roots in older forms of brand advertising. 

As live sports and comedy specials increasingly make their way into Netflix, Amazon Prime, Hulu, ESPN+, and other streaming TV platforms, the “premium” style of ad creative is going to be combined with the first-party and commerce data. 

Similarly, retail media networks from physical and digital store chains like Walmart and Target expect to leverage the brand marketing values associated with in-store shopping to the targeted performance programs. Companies such as Attain, however, have a bird’s-eye view of the entire retail landscape, providing advertisers with a holistic view of where consumers are shopping and what they purchased. 

“Even in CTV, you're starting to see the use of QR codes that drive to landing pages or shopping experiences,” Goode says. “And that ultimately gets digital measurability and outcomes into streaming TV, versus traditional linear TV measurement, that leverages more generalized metrics, like household level. These combinations of new and old media consumption and measurement offer the opportunity to use channels across both branding and performance.”

“The point is, you always had to do both; now it’s more possible to do it,” she says.

other stories you might like