effectiveness in context

Peter Field and Les Binet’s latest report, Effectiveness in Context, explores the damage being done as companies increasingly cut long-term brand investment in favour of short-term sales activation, and highlights how the “60/40 rule” changes depending on the context.

Highlights from the research include:

• There is no context in which short-term sales activation is the primary driver of growth – short-termism in marketing is unwise. Always.
• The more online research that consumers conduct, the more important it is to invest in strong brands to prime choice in advance of purchasing – last minute purchase activation is no substitute for brand building.
• The “60:40” rule for balancing brand and activation expenditure is evolving. Overall, brand spends need to increase, but there are significant variations by sector. Optimum brand investment peaks in Financial Services and is lowest in Perishable Services such as Travel.
• Although marketers have largely understood the limitations of loyalty marketing, some pockets of resistance remain – there is no empirical justification for this in any context.
• There is no evidence that major brands are losing their appeal and their market strength in the digital era – they continue to enjoy enormous scale advantages that have growing value in all contexts. So long as they continue to invest in brand marketing.

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