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Performance Marketing vs Branding – Finding the right mix for your brand

Reading Time: 3 minutes

Branding vs Performance is an age old debate, with many brands still struggling to strike the right balance between the two.

branding campaign is a golden opportunity for you to build, or rebuild your brand’s image in the mind of the customer, and an efficiently strategized and effectively executed brand campaign can help you put your brand’s story and message in front of an audience to increase brand awareness and improve brand equity in the mind of customers. It is a tried and tested way to control your brand’s narrative and public image and differentiate your brand from the competition.

performance marketing campaign, on the other hand, is a comprehensive term that refers to “online marketing and advertising in which advertisers pay when a specific action is completed, such as a sale or lead.” This is a digital marketing strategy that’s driven solely by immediate, and typically short-term, results. You place an ad on one of the available performance platforms – one that is targeted to specific users – and you optimise the spends to get your target customers to take a particular action.

The split between performance marketing and branding in a brand’s budget will depend on the specific goals and strategies of the brand. Performance marketing, such as paid search and social media advertising, is focused on driving immediate conversions and sales. Branding, on the other hand, is focused on building brand awareness and creating a strong emotional connection with consumers, along with building a positive image for the brand over the long term. 

In general, a brand that is just starting out or looking to quickly increase sales may want to allocate a larger portion of its budget to performance marketing. On the other hand, a brand that is well-established and looking to maintain or increase market share may want to allocate more of its budget to branding. A good starting point is to allocate a majority of the budget to performance marketing and a smaller portion to branding. This will allow the brand to drive immediate sales or conversions while also building long-term brand awareness.

Ultimately, the ideal budget split will depend on the brand’s specific goals and target audience and should be determined through testing and analysis. It is also important to review and adjust the budget allocation periodically in response to changes in the market and the effectiveness of different tactics. 

However, as the brand’s goals and objectives evolve, the budget split may need to be adjusted accordingly. For example, if the brand is looking to focus on building its reputation and awareness, it may make sense to allocate a larger portion of the budget to branding efforts. 

Raghav Kansal, Founder and CEOET Medialabs, also presents a more practical viewpoint on solving this popular dilemma of how a brand should bifurcate its spends between Performance and Branding, “One of the key trends that we observed while managing performance of a lot of clients is that, at some point, performance eventually starts to saturate, and it is very difficult to predict that on day 1. The idea is that till the point performance is giving you decent ROI, you will continue to scale performance and probably keeping putting 10-15% budget on branding. And eventually as the performance starts to saturate,  the mix slowly moves from say, 90-10 performance- branding to probably 70-30%, or 60-40%. So while initially the focus can be more on performance, but as the performance saturates we slowly start shifting your budget towards branding that is the approach we have seen to work really well.

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