What if you could actually measure the effect of media spend on brand consideration?
Many companies struggle with the balanced allocation of their marketing budgets between performance marketing and branding. The direct impact of activities like campaigns to increase brand consideration, for example, is not always straightforward to define, making media budget allocation difficult. We have observed that companies often allocate a large amount of their media budget to performance marketing in comparison to branding, simply because it is easier to quantify and justify.
But, what if branding could become a performance indicator?
We have carried out research into measuring the long-term effect of brand consideration campaigns and found a way to incorporate branding in media budget allocation calculations.
To undertake any marketing action, knowing and understanding customer journeys is essential. A vital step in this journey is brand consideration. Marketers strive to get their brands included in consumers’ initial consideration sets, the membership of which increases the likelihood of purchase for a brand. The consideration set is the set of brands that consumers consider potential options when deciding to make a purchase. This is an important metric, but one in which there is a lot of variation. Due to the sampling method, using small samples sizes and continuously varying treatment groups, there is more variation in this metric than there would be in the (unmeasurable) true brand consideration. This makes it difficult to identify the effect of any investments in media for branding purposes.
We used data from a large company with a significant marketing spend to see if we could measure the effect of media spend on branding. By adjusting the variable brand consideration to remove the short-term variation, we were able to model the relationship between media budget for branding purposes and long-term brand consideration. We also identified a quantifiable proxy metric for brand consideration, which is readily available and easy to measure. This metric can quantify the short- and long-term effect of branding and can produce actionable insights regarding the branding budget. It is also a metric that can be easily understood and thus acted upon across the entire organization.
Defining a performance metric that can quantify and measure the effect of branding campaigns is therefore worthwhile. For a detailed description of our results, download our white paper here.