A continued emphasis on short-term tactical marketing, rather than longer-term efforts that prioritize brand, means Canadian businesses are “without doubt” missing out on potential growth opportunities, says advertising effectiveness guru Peter Field.
“You don’t achieve maximum growth when you go short-term,” said Field, regarded as one of the world’s leading experts on advertising effectiveness ever since the publication of his 2013 book, The Long and the Short of It. In the book, Field and co-author Les Binet argued against the so-called “performance marketing revolution,” in which a focus on brand building was dismissed as old-fashioned in an era of data-driven targeted advertising.
Field spoke to Canadian marketers and agencies during an ICA event last week entitled “The Alchemy of Effectiveness,” presenting findings based on an analysis of more than 100 Canadian Effie Awards submissions from 2021 and 2022.
He warned that the industry’s continued preoccupation with short-term marketing—capable of producing short-term sales spikes, but little in the way of meaningful brand salience—is destined to undermine brand health.
“There is a grave danger, and it’s clearly very present in the Canadian marketplace, of short-term metrics driving strategy and thinking,” he said. “When that happens you walk away from the potential for maximum long-term growth. It’s a really dangerous thing, and we have to push back against it as marketers.”
Focusing on short-term sales compromises long-term benefits like the ability to boost profit and pricing power, and grow market share. “These are the kinds of objectives that accumulate over time, and tend to be associated with long-term brand-building strategies,” he said.
Field’s analysis suggests that Canadian marketers have more of a propensity for short-term marketing than colleagues in markets like the U.K. and Australia, and that there has been a “measurable increase” in the percentage of case studies prioritizing short-term sales over brand building.
According to the report, Canadian campaigns with short-term sales objectives at their heart rose from 55% of submitted cases in 2021, to 60% in 2022.
“In these nervous, uncertain times, the traditional response is that marketers go short—and that’s precisely the opposite of what you should be doing.” A strong brand, he said, is not a luxury. “If I achieve only one thing [with this presentation] it will be to reverse that trend, because it is in the interest of branded businesses.”
Field’s analysis of the Effies database found that more than half (54%) of campaigns ran for less than one quarter, while less than one-third that could be characterized as long-term campaigns. “That inevitably has implications for the levels of effectiveness we’re going to get,” he said.
He said that the emphasis on short-term marketing activations results in so-called “nudge metrics” that have no discernible impact on “mental availability” and overall brand health. “If we’re not building mental availability, we will not be driving long-term growth,” said Field.
While brands can certainly enjoy healthy sales spikes by delivering what Field described as “the right nudge” to the right consumer at the right time, typically using sophisticated targeting techniques, the downside is that the effects of such efforts tend to be short-lived, said Field. “They decay very rapidly, [consumers] don’t remember them for very long, and we have to keep re-serving these messages times and time again simply to stand still.”
A campaign running for more than two quarters, for example, is capable of producing 3.7 “very large” brand effects, compared to 2.5 for shorter-term campaigns. “If I’ve seen this chart [below] once, I’ve seen it a thousand times in different geographies around the world and over time,” he said. “Why should the Canadian marketplace be any different from any other developed economy?”
While Field said he has heard from brands claiming that sales imperatives means they don’t have the resources or opportunity to engage in brand-building activity, he argued that building overall brand health afford them the ability to engage in more sales-focused efforts down the road. “The stronger the brand, the more agile and able it is to be able to turn the short-term effects on,” he said.
“If you want to be an agile brand, it’s good to be a strong brand,” he added. “Every dollar you spend on performance marketing [in the wake of focusing on brand-building] will drive a bigger response, because consumers know your brand, trust your brand and rate your brand, and when you put a message out there that says ‘buy now’ they are going to respond more favourably than if they’ve never heard of you, don’t trust you, and have no real familiarity with you.”
Brand-building efforts, he added, can also have a pronounced impact on pricing power. “We tend to be able to defend or grow our margins when we start brand-building,” he said. “Over the long-term, brand building gives us increased [sales] volume at increased margin, which is why it has such a profound impact on profitability.”
Identifying specific campaigns employing brand-building practices, Field pointed to No Frills’ long-running “Haulers” campaign as an example of an approach that helped the Loblaw Companies Limited banner create a distinct brand identity in the crowded discount grocery category, while achieving annual sales growth of 2-3% .
“That’s one hell of an achievement in a vicious, cut-throat category,” he said. “If anyone says ‘We’re a discount brand. We don’t do brand-building,’ I would urge you to study these kinds of retail discount brands, because these are the guys that are really on the cutting-edge of discounting. If you’re a discount brand, you can’t afford not to build the brand—it’s absolutely going to be vital.”
Field said that No Frills excelled by having “Haulers” permeate the entire brand proposition. “It’s not just a brand idea they float out there on some fancy, high-profile brand campaign,” he said. “They work it right through the funnel—down to in-store activations and bottom of funnel communications. It’s a very disciplined, very savvy piece of thinking targeting very savvy shoppers.”
Field went on to advocate for a 60:40 split in terms of overall spend in favour of brand-building activity versus short-term tactical marketing. “Overbalancing towards a short-term, tactical approach obviously has its attractions but risks mortgaging the future of the brand for temporary gain,” he said. “It doesn’t make sense in either the good times or bad. Canada has clearly been strongly seduced by short- termism, and it is a vital role of marketing to push back against the quarterly pressures and seek balance with long-term growth.”
—Photo courtesy of Commercial Communications Council