.png)
Inspired by Jenni Romaniuk’s book 'Better Brand Health', this article will delve into the reasons why measuring brand health is crucial for businesses aiming to thrive in today's competitive market landscape. The article draws on knowledge derived from our experience of working with clients across different industries.
Brand health is an indicator of a brand's strength and appeal, reflecting how well it connects with its intended audience and differentiates itself from competitors. A healthy brand consistently maintains a positive reputation, establishes a deep relationship with consumers, and consistently delivers on its promises, contributing to long-term business success. Tracking and improving brand health is important for businesses that are trying to navigate today's complex market dynamics and need to adapt to changing behaviour of consumers to secure a competitive advantage.
This article will explore five reasons why it is important to measure brand health:
By focusing on brand health tracking from a strategic point of view, your business can navigate market complexities more effectively, ensuring that your brand is not only seen but also remembered by your intended audience.
There is a significant risk of missing opportunities when focusing only on the immediate results of performance marketing campaigns, without considering the broader, long-term brand impact. This narrow focus can lead to a distorted perception of which channels deliver the best return on investment (ROI).
For instance, if we focus only on the short-term effects of a specific campaign, e.g. search advertising might seem to offer the highest immediate ROI because of its direct impact on sales. However, viewing the campaign from a long-term perspective reveals that TV advertising, because of its brand-building capabilities drives substantial sales well after the campaign has finished.
This delayed effect, highlights the importance of considering how the visibility and influence of TV advertising accumulate over time, contributing to sustained brand recognition and increased sales long after the initial advertisements have aired.
This is a classic example of how focusing only on short-term performance can lead to missed opportunities in investing in other channels that focus more on brand building. Without measuring the long-term effect, businesses may undervalue channels like TV that are crucial in cultivating lasting brand consideration and loyalty.
.png)
Based on valuable feedback from our clients and their needs, we are launching a Short vs Long Term Effects dashboard. This powerful tool helps identify which channels excel at driving immediate results and which are most effective for sustained brand building.
This development was driven by our understanding that brand value, whether measured by Brand Consideration, Ad-awareness, or a custom Brand KPI, amplifies both baseline sales and media effectiveness. It acknowledges the sophisticated interplay between media campaigns, brand value and their enduring impact on performance and sales.
Let's look at a practical example. When an advertiser launches a TV branding campaign, the immediate sales uplift might seem modest relative to the investment. However, traditional attribution models miss a crucial point: this campaign strengthens the brand's position with the target audience, making future call-to-action campaigns more effective.
The Short vs Long Term Effects dashboard reveals these temporal dynamics across different media breakdowns (channel, advertised product, campaign types and campaigns). It clearly shows how some media channels deliver strong immediate results while others create significant long-term value through enhanced brand strength, helping inform strategic planning for cross-advertising investments.
Including this analysis in our MMM provides clients with the ability to evaluate both the total impact and temporal distribution of media effects on baseline and sales. This comprehensive view enables clients to understand how media and non-media factors influence performance, assess investment efficiency across different media breakdowns, and make data-driven decisions about campaign planning and investments. The dashboard offers detailed insights into specific campaign types and their effectiveness, serving as an essential tool for optimising cross-media advertising strategies.
It's essential to make your brand the first option customers think of, especially in industries where people don't make purchases very often. Subscription services, like the internet packages that Telecom providers offer, could be one example.
By focusing on building a strong brand, you can ensure that when customers are ready to buy, your brand is at the top of their minds. This approach is particularly important considering that at any given time, only a small percentage of potential customers are actively looking to purchase products or services.
Keeping your brand health in top shape means that when consumers are ready to make a decision, your brand is the first they think of, greatly increasing your chances of being their chosen provider.
For example, a study by Ehrenberg-Bass Institute shows that only around 5% of your potential buyers are ready to buy today. Therefore, only a small portion of your clients are looking for a new internet plan at any time. This shows Telecom providers need to focus on making a strong brand so when the time comes to pick a new provider, your brand is what customers think of right away.
.png)
A key benefit of maintaining strong brand health is its ability to withstand price drops without affecting its value or position in the market. Insights from the book "The Long and the Short of It" by Les Binet and Peter Field reveal a critical analysis on the effects of different marketing tactics on a brand's pricing strategy.
Research from the book shows that while discount promotions like coupons and direct marketing can boost sales in the short term, they also make customers more focused on price. This focus on price can weaken the brand’s value over time.
In contrast, brand-building promotions such as competitions, gifts, and instant wins, might not immediately increase sales but help reduce customer fixation on price by making the brand more attractive without lowering prices.
This approach protects the brand’s reputation and finds a balance between short-term gains and long-term success. Thus, investing in your brand's health lets you manage pricing in a way that can promote growth without compromising the brand’s perceived value.
For example, imagine a clothing retailer that frequently offers discounts through coupons and direct email marketing. Initially, these promotions lead to a spike in sales as customers rush to take advantage of lower prices. Over time, however, customers begin to expect these discounts and start to associate the brand with being "cheap" or lower quality.
They might postpone purchases until the next sale, reducing the brand's ability to sell products at full price. This strategy, while effective in driving short-term sales, gradually erodes the brand's perceived value, making it harder to maintain loyal customers who are willing to pay premium prices.
In contrast, imagine a cosmetics company that rarely discounts its products. Instead, it focuses on brand-building activities like hosting makeup competitions on social media, giving away free samples with purchases, or offering limited-time gifts to customers. These promotions don't necessarily lower the product prices but make the brand more desirable by improving the shopping experience and adding value beyond just the cost.
As a result, customers become more attached to the brand for its quality and the unique experiences it offers, rather than just the price. This strategy helps maintain the brand's premium image, reduces the emphasis on discounting, and builds a stronger, more loyal customer base that appreciates the brand for reasons other than just low prices.
.png)
Improved brand health significantly improves the effectiveness of performance marketing campaigns, resulting in a higher return on investment (ROI). A healthy brand includes recognition, trust, and a positive association in the minds of consumers. When people recognise and trust a brand, they're more likely to react positively to marketing initiatives, including promotions and new product introductions.
This immediate recognition and trust mean that performance campaigns can be more efficient, as they don't need to spend as much time and resources on introducing or re-establishing the brand's value. Consequently, marketing budgets are used more effectively, leading to higher conversion rates.
Monitoring brand health enables your business to refine your marketing strategies. By leveraging on the trust and recognition you’ve established with your audience, as a company you can ensure your marketing messages resonate more deeply and drive greater results.
For example, a car manufacturer known for quality and innovation launched a performance marketing campaign for their new electric vehicle (EV) line. Their strong brand health, characterised by high consumer trust and recognition, meant the campaign could focus directly on the EV's features without needing to rebuild brand credibility. This approach resulted in a high conversion rate and a low cost per order (CPO).
In contrast, imagine if this same car brand hadn’t focused on building its brand for a while and spent all its budget on performance campaigns. In this scenario, consumers might not really understand the main values and messages the brand aims to portray, due to the lack of brand-building messaging and campaigns.
This would require additional effort and resources to reassure customers of the brand's value and quality. Such a scenario would inevitably lead to a higher CPO, as the campaign would need to work harder to overcome reduced trust and recognition, underscoring the critical impact of brand health on marketing efficiency and effectiveness.
.png)
Nowadays, people pay more attention to brands because it's getting harder to measure how well performance marketing is doing. By focusing on measuring your brand's health, you're filling in this gap and making it clearer how important your brand really is.
This comes in handy, especially when budgets are tight, and it seems easiest to cut spending on brand marketing first. This is usually because it's not immediately obvious how reducing brand spending affects sales.
However, by examining the total effect of media and considering both its short-term and long-term impacts, we can identify a clear pattern: when brand marketing budgets are cut, brand health and eventually sales start to drop over time.
By showing the return on investment (ROI) for putting money into the brand, marketing teams have a strong case to present to the CFO or finance department. This isn't just about keeping your current budget; it's about demonstrating the long-term value of investing in your brand's health. With this approach, you can keep your brand strong, growing, and financially backed, even when times are tough.
.png)
Wrapping up, this journey inspired by Jenni Romaniuk's "Better Brand Health" highlights how crucial it is for businesses to keep an eye on their brand's health. It's all about finding new chances to grow, making sure customers think of your brand first, setting smart prices, making your ads work better, and planning wisely to stay ahead in the game.
Measuring brand health isn't just another task—it's a key strategy that helps businesses stay in tune with what customers want and how the market is changing. This focus on brand health helps businesses not just survive but thrive, making sure they're always a step ahead in today's fast-paced world.
In simple terms, keeping track of your brand's health is like having a roadmap for success. It helps businesses navigate through changes and challenges, ensuring they remain relevant and successful.
If you are interested in learning more about how your business can measure the long-term and short-term effects of your media investments with our Direct vs Indirect Effects dashboard, make sure to reach out.
