Quit splitting the budget. Brand vs performance isn't really a choice

Brand vs performance is the wrong question

Let’s agree to retire the question, “Should we invest in brand or performance?”

The idea that brand is what you do instead of performance is not only wrong - it’s economically illiterate. Your brand is the thing that makes performance work in the first place. It’s what makes clicks cheaper, conversions easier and your entire marketing system less dependent on how generous Meta’s algorithm is feeling this week.

Brand and performance are two parts of the same machine:

• Brand builds future demand by creating memory, meaning and preference.
• Performance captures current demand by turning intent into revenue.

Customers don’t experience them separately. No real human thinks, “That ad was brand, that one was performance.” They just experience a series of touchpoints that shape who they remember, who they trust and who feels like the “obvious” choice when a need appears.

If you only ever capture, and never build, you eventually run out of people to sell to.

If you’ve been hammering ads, sending a thousand “30% off emails” and trying to toggle every lever while your cost-per-acquisition laughs in your face, it’s because you have nothing around your performance. No mental availability, no distinctiveness, no positioning, no memory structures to make the thing efficient.

Why can’t I just spend more on ads?

Actually you could. If you have an endless bucket of money to spare.

Performance marketing is brilliant at what it does. We run it. We love it. We’re very good at it. It’s how you:

• hit this month’s numbers
• test messages quickly
• prove what’s working in the short term

But as a growth strategy, performance-only has some brutal ceilings.

1. You only ever reach the 3–5% who are ready to buy now

Most performance tactics target people already “in market” — actively searching, comparing, clicking. That’s a tiny slice of your total opportunity.

If all your spend is aimed at that group, you’re not really growing market share. You’re just fighting harder for the same few buyers as everyone else.

2. You get diminishing returns

As you scale, you end up:

• hitting the same people more often
• bidding more for the same clicks
• discounting more to win the deal

Optimisation buys you time, not escape. Eventually, your CPA climbs, your leads plateau and everyone starts blaming the channel.

3. You become a hostage to algorithms

If your entire engine is short-term activation, your revenue is tied to platform behaviour you don’t control. One change to targeting, attribution or auction dynamics and your numbers can swing overnight.

A strong brand doesn’t make you immune, but it does make you less fragile.

4. You slide into generic, price-led messaging

Without brand foundations — clear positioning, distinctiveness, associations – your ads fall back on the usual mush:

• “quality service”
• “affordable prices”
• “fast & reliable”

If anyone could say it, it’s not a brand. And when you sound like everyone else, the only lever left is price. That’s not growth. That’s slow erosion.

Performance is powerful. But on its own, it’s harvesting. Not planting.

Good marketing is long and short

So what does the research say? You don’t pick a side. You pick the right balance.

The most robust work on marketing effectiveness — from Les Binet and Peter Field using the IPA Databank — is very clear:

The strongest brands combine long-term brand building with short-term sales activation.

Rule of thumb - spend around 60% of budget on brand, 40% on activation. Not as a religion, but as a starting point.

Why that split?

• Brand activity works slowly but compounds.
• Activation works quickly but decays.

You need both working together:

• Short-term activation (performance)
  • Targets people already close to buying
  • Uses direct response, offers, urgency
  • Delivers sales this month
• Long-term brand building
  • Reaches people before they’re in-market
  • Builds mental availability and preference
  • Drives sales momentum over the next 12–36 months

Brand is the rising tide that makes every future activation more efficient. It’s the difference between shouting offers at strangers and making a simple, timely ask of someone who already knows you.

What the hell does brand even mean?

Brand is not your logo, your fonts or the moodboard in your style guide.

Brand is what you want to be known for and the picture you build in people’s heads to make that happen.

Once you strip away the fluff, effective brand building comes down to a few fundamentals:

Clear, consistent positioning

People should know who you’re for, what you do and why you’re different.

Distinctive creative and assets

Repeated use of recognisable elements: colours, shapes, tone, lines, characters, audio. Think of these as your brand’s shortcuts in memory.

Emotional impact

Feelings drive memory. The IPA Databank shows emotional campaigns are more likely to deliver large business effects than purely rational ones. If people feel something, they remember you.

Broad reach over time

You grow by reaching more of the category, not just slicing your existing segment thinner. This is where excess share of voice comes in: brands that maintain a higher share of voice than their current share of market tend to grow.

Repetition

Brand building is cumulative. It’s not one “big bang” moment. It’s the same core story, told well, again and again.

Learn more about building brand that builds demand: https://www.dilate.com.au/blog/the-ultimate-guide-to-building-a-brand-that-drives-business-growth/

This isn’t theory. There’s real evidence that building brand works

Binet & Field’s work on over 1,000 campaigns is some of the most pivotal in this space, and their publication on the long and the short is a damn good read. But there are also things you can measure to see how your brand strategy is doing. 

Excess Share of Voice (ESOV)

When your share of voice (how loud you are in the market) is higher than your share of market, you tend to grow. The bigger the gap, the faster the growth — provided the creative is decent.

Brand spend is how you buy share of voice. Performance spend is how you monetise it.

Mental availability and brand salience

Ehrenberg-Bass and others have shown that brands grow by:

• being easily thought of in buying situations
• being linked to multiple “category entry points” (situations, needs, occasions)

Brand building creates those memory structures. When people think “need X”, your name pops up faster and more often. That’s mental availability. That’s salience. That’s equity.

Reduced price sensitivity

When your brand’s doing its job, you don’t have to race to the bottom. You earn the right to charge more, because people see the value before they see the price.

Brand makes performance cheaper

When people recognise and trust you:

• your click-through rates go up
• your conversion rates go up
• your cost-per-acquisition goes down

Branded search volume, direct traffic and repeat visitors are all simple, real-world signals that your brand work is doing its job. Those users:

• convert faster
• care less about price
• are more likely to stick around

It’s not magic. It’s just how markets work. And pretending you have to choose between brand and performance is like choosing between food and water — a brilliant strategy right up until the moment you die.

How to start thinking full-funnel

You don’t have to blow up your current marketing plan. But if everything you do points at “leads now”, you need to start building the layers around it.

Here’s how to shift into proper, full-funnel marketing.

1. Get a real diagnosis

Before throwing more money at campaigns, ask:

• How are you positioned in the market?
• What do customers actually think of you?
• Where are you genuinely distinctive?
• What’s your current split between brand and activation?

Without diagnosis, “strategy” is just a list of tactics in a nicer font.

2. Decide what you want to be known for

If customers can’t describe you in one or two clear ideas, your brand is fuzzy.

Clarify:

• the problems you solve
• the value you represent
• the few key associations you want to own

Then build your messaging and creative around those.

3. Run genuine brand-building campaigns

Create campaigns whose primary job is to:

• reach as many of the right people as possible
• tell a fluent, emotional story about who you are
• hammer home your associations and assets

Measure them on long-term signals: reach, frequency, branded search, shifts in consideration — not just last-click ROAS.

5. Use performance to capture what brand creates

Once you’re building demand, refine your activation:

• aim more budget at branded and high-intent searches
• retarget based on brand engagement, not just website behaviour
• ensure your landing pages and offers match the brand story people have seen 
• reduce friction so the path from “interested” to “customer” is short and obvious

Brand opens the door. Performance walks them through it.