The switch from short to long-term marketing

From pandemic to political turmoil – and now a potential recession – the last few years have been something of a roller coaster. A string of events has seen brands perform all kinds of U-turns in an attempt to align with their customers’ behaviours.

Not only did over half of marketers pivot in 2021, 83% of those who pivoted changed course two to four times in one year, as per HubSpot’s 2023 Marketing Strategy & Trends Report.

As the cost-of-living crisis bites, one of the more interesting recent trends is for brands to refocus on what made them the go-to company in the first place – building their brand.

The dynamic between brand and performance is something we wrote about not so long ago – in which we acknowledged that performance marketing seemed to have become the key focus for many online brands – but things have taken a turn, off the back of some bold calls by some of the biggest names in the game.

A change of tact

Having moved spend away from performance, and into brand marketing, Airbnb declared it the right shift following a record Q4. CEO Brian Chesky said Airbnb now looks at the role of marketing as one of “education”, not “to buy customers”.

Speaking earlier in the year, he said: “We’re seeing great success in the brand marketing that we did last year and we’re going to be expanding it to more countries.”

Another major online business which has more recently come round to this way of thinking is clothing retailer ASOS, which – by its own admission – cited “insufficient” brand investment and an over-reliance on promotions driving a slowdown in customer acquisition.

More than 80% of the online fashion giant’s marketing investment had been focused on performance marketing. As part of a rebalancing from short to long-term marketing, ASOS is now using video to experiment with a storytelling approach that lends the brand authenticity in its marketing messages.

What prompted the rethink?

ASOS has seen the erosion of its gross margin in recent years. The reliance on sales and promotional deals as a tool to attract customers ultimately resulted in new customer acquisition slowing down, and current customers lowering their perceived value of the brand and waiting for bigger promotions before making purchases.

If you haven’t waited for ASOS to offer a 20% discount before completing your purchase, you’ve been doing it wrong. Shoppers aren’t naive; regular sales promotions encourage them to wait for the next sale rather than purchase a product at full price.

It remains to be seen whether ASOS will be able to ditch its rep for being a discount brand. Will customers still be interested without the money-off carrot being dangled?

Having neglected brand building for such a long time, ASOS knows that it must now put in the hard graft and go to where it understands its target audience to be, all while speaking to their values and preferences.

Finding the right balance

We all tend to fall into the trap of pitching brand building and performance marketing against each other – when it’s more about experimenting to find the perfect balance of the two.

Ultimately, there’s a time to focus on brand building (which is, of course, all the time) and moments when you’ll want to boost sales off the back of successful campaigns, tactical opportunities and the wider climate.

A significant increase in e-commerce means customers now have more information readily available to them right at the crucial point of purchase. As easy as it is to buy with the touch of a button, it’s equally as easy to access the latest reviews and compare the specific attributes of one product over another.

The ability to quickly analyse the benefits of one product over another, results in a very rational purchase decision. A situation that could spell danger for any brand that’s perhaps not the best on paper or whose price doesn’t match their rivals.

However, brand building predisposes customers to choose your brand over others – regardless of what the more rational, informed decision may be.

Think of it this way - another reason to convert these customers from brand campaigns is that you’re buying their loyalty, which should ultimately be more profitable in the long run. There’s no doubt that performance marketing tactics can acquire customers quickly, but at what cost? Are they profitable customers in the long term or did they just sign-up because of that promo?

Branding where the eyeballs are

Traditionally, it’s been tempting to think of brand and performance as off / online channels, but with average UK internet users spending 4 hours a day online, isn’t it time you explored online branding?

Long-form branded content in the publisher environment can reach audiences who are willing to invest their time in learning about a brand, reading their story and aligning their values.

Seeing brands advertising in publisher environments they trust gives the brand an immediate uplift in perception – according to comscore, native articles lead to a significant lift across five key brand metrics, including unaided awareness and purchase intent, throughout consumers’ entire journey.