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Advertising for the Long Term
We’re in the home stretch of our five-part series, exploring a variety of common marketing myths. Along the way, we’ve compared small and large brands, examined mass marketing efforts, and broken down differentiation versus distinctiveness.
Here in our fourth post, we’ll be tackling advertising: what is the purpose of advertising? What are the different ways to advertise and which are most effective? Regardless of size or market share, all brands must advertise to achieve both short- and long-term growth. Inspired by Byron Sharp and the Ehrenberg-Bass Institute, this post will unlock the truth behind effective advertising and how it can help brands grow beyond belief.
Before we begin, why do brands advertise in the first place? Though you may believe it’s to boost revenue, the truth is, advertising simply prevents the slow decline in sales. It rarely causes a jump in sales. Advertising’s effects on sales tend to be spread out over time, and are extremely difficult to measure because of this. As such, the true purpose of advertising is to hold onto a brand’s huge base of infrequent buyers, by reaching and nudging them.
SHORT- VS. LONG-TERM GROWTH
Simply put, brands must advertise, but how can they do so to achieve short- and long-term brand growth? Short- and long-term growth are inherently different. This is where our first marketing myth comes into play: contrary to popular belief, a long-term result is not a series of short-term results joined up. In fact, marketing efforts that lead to short-term growth often inhibit long-term growth, the Institute of Practitioners in Advertising (IPA) has found. As such, brands need to strike a balance between their short- and long-term growth efforts.
The IPA also outlined the kinds of advertising campaigns that can bring about short- or long-term growth. They wrote that emotional metrics tend to predict long-term success, while rational metrics tend to predict short-term success. Not only that, but they emphasize the most important driver of long-term growth is the level of share of voice, or “the brand’s share of total communications expenditure by the category.”
Martin Weigel, the Head of Planning at Wieden+Kennedy Amsterdam, firmly believes in the dangers of short-termism in marketing. He believes brands should strive for meaningful, long-term growth, rather than chasing short-term metrics. This, of course, can be difficult in today’s day and age, where short-term data are easier to come by than ever. As such, brands must practice patience: growing a brand simply takes time. This time must, however, be wisely spent, with some effective advertising along the way. Let’s deep-dive into what effective advertising looks like.
SOME ADVERTISING RULES
There are two critical advertising decrees brands should abide by: advertising should 1) target buyer reach rather than frequency of exposure and 2) target continuous advertising over bursts with gaps. Let’s take a closer look at the first one.
We’ve already learned that market penetration is more important than customer loyalty. Our first advertising rule aligns quite nicely with this concept: rather than affecting customer loyalty by exposing certain buyers to advertisements more frequently, brands should try to affect market penetration by targeting a wider audience. So, brands should try to advertise to all category buyers, from non-buyers all the way to heavy buyers.
The most effective campaigns talk to the whole category—that is existing and potential customers—but how can brands do this? There are a number of channels dedicated to broad reach, one of which is TV. Here we have come across our second marketing myth: though TV advertising has been proclaimed dead, it’s still more valuable than ever. This is because videos can maximize reach and be highly emotionally involving, which, as we’ve seen, is critical for long-term brand growth.
Moving to our second rule, we find that brands should advertise in a continuous stream, rather than in bursts. This follows the idea that advertisements are meant to consistently strengthen brand associations, which happens more effectively through well-timed repetition. Long lapses in advertising cause your hard-earned brand links to fade in consumer memory.
ADS AND THE BRAIN
Ads work through memory, building an element-to-brand link within the brain. Studies have shown that emotion influences and motivates customer attention, memory, and behavior. So advertising through an emotional message, rather than a rational one, is key. This is to say that emotional images are more effective than a page of facts and statistics. Ads that consistently display your brand elements and tap into consumers’ emotions will be far more memorable, and thus brand-building, in the long-term.
If we take a closer look at a consumer’s brain, we can see that advertising works via persuasion and salience. Persuasion is the act of changing a consumer’s opinion, while salience simply refers to the act of refreshing or building consumer memories.
Changing consumer’s opinions is actually quite hard, and usually ineffective, so brands should focus on salience, rather than persuasion. As we’ve said, salient advertisements can refresh memories or build new ones. Here, again, building new memories is quite difficult, so refreshing them is most effective.
In sum, brands should strive for advertisements that refresh consumer memories through emotion and consistent brand element usage.
Outside of advertising, we find a similar, but markedly different, sales strategy: price promotions. Price promotions are time restricted—“buy these jeans for half off, this week only!”—so they show up within sales figures easily and clearly. Such promotions generate a short-term sales spike, with sales returning back to previous levels as soon as the promotion is over.
There’s no evidence that these promotions grow penetration or loyalty, as already-heavy buyers are the most likely to notice the promotion, given their status as a heavy buyer. At the same time, promotions aren’t necessarily detrimental for the brand either. Consumers don’t really remember prices, so promotions won’t dramatically change their reference price. If, however, brands consistently offer deep discounts, they could erode their reference price and brand image.
It is important to note that price isn’t everything: top brands are rarely the cheapest. In fact, many people buy across price categories. Buyers in a low price range occasionally buy up, and vice versa. So, beyond the benefit of a quick spike in sales for a manager or to comply with retailers/manufacturers, price promotions don’t really do much for brands.
To review, this post took a closer look at brand advertising. We found that ad campaigns usually don’t show up in short-term sales metrics, but, if done effectively, can tremendously help in building a brand over the long-term. That having been said, advertisements should be emotional, consistently display your brand elements, and refresh consumer memory. Stay tuned for our last post in this marketing myths series, examining the importance of the mental and physical availability of a brand. Ultimately, it will tie together all of the marketing myths we’ve presented thus far in an actionable set of rules all brands should follow.