In a year where we’ve seen White House communications director Anthony ‘The Mooch’ Scaramucci last only 10 days in his newly acquired role and Coca-Cola’s ‘Coke Life’ brand being dropped from Australian shelves after an extensive launch only 2 years ago, you may be right in thinking we are living in an increasingly short-term world. Whether it be a person or a brand, if it’s not performing in the short-term it’s under threat of being cut.
Specifically, in Marketing, over the past few years we’ve seen a huge emphasis on short-term goals for brands. Time and time again we receive a client brief in which the objectives state that the brand activity must create a targeted, tactical sales campaign, the success of which will be measured via short-term ROI, as if that is the key indicator of the brand’s success. Surely this is only targeting the brand’s current, heavy consumers and not aiming to widen the net? So, what about long-term brand growth, profit and market share? Has this fallen by the wayside for the short-term gains? In this day and age, you could be excused for thinking our perception of brands is “we’re here for a good time, not a long time”.
Don’t get me wrong, short-term activations can see great results for brands. Newsworthy events like the election of Donald Trump, the marriage equality plebiscite in Australia and Kim Jong-un’s latest antics have all given rise to a plethora of clever, tactical, and clearly short-term brand activations. The digital revolution has allowed brands instant access to consumers and provides a very effective mass marketing platform.
These fast turnaround, reactionary brand activities are perfect for social media – they’re attention-grabbing and see great brand engagement. But these ‘campaigns’ aren’t enough to build a brand in the long-term. So, as brand owners, why do we need to focus on the long-term in this seemingly short-term world we live in?
At the Communications Council’s “Marketing Effectiveness on Trial” event in Sydney in early September, highly respected author and marketing and advertising expert, Peter Field, said “Wherever you go, we are pulling billions out of brand building for long-term growth in order to fund this obsession, this addiction to short-term sales activation because we think it’s cool.”
Peter Field and his colleague, Les Binet, analysed every entry into the IPA Effectiveness Awards competition since 1980 and came to the conclusion that in recent years, short-term objectives and measurements of success are increasingly prevalent, to the detriment of brands and their long-term success.
Field went on to say, “By ignoring the enduring effectiveness truths of the changing media landscape, businesses are undermining the tremendous potential of the new tools at the marketer’s disposal. To remedy this, marketers should return to a more balanced perspective on long versus short-term objectives, with around 60% long-term brand building and 40% short-term activation still the best combination.”
Field also cites that Australian marketers are currently obsessed with ROI and won’t consider any brand building activity if it isn’t guaranteed to deliver. Generally, these activities only attract the heavy consumers, who have already bought into the brand and may drive short-term purchases but rarely build the brand to achieve long-term sales. “If you want to drive profit growth, you have to be into the long-term game… because you end up driving volume and margin.”
Perhaps one of the driving forces towards this obsession with short-term brand results is the ever-increasing pressure from retailers for a brand to perform on-shelf in the short-term, or be under threat of deletion. We see it all the time in the grocery channel, with the big supermarket chains conducting multiple range reviews per year, requiring a brand to prove itself through sales in only a short period or face being removed and replaced by another. Thus, meaning the short-term success of the brand becomes paramount to ensure it remains on-shelf and so we continue to see brand owners jumping to the demands of the supermarket giants in a ‘do or die’ situation to keep their brand on-shelf. Unfortunately for brand owners, most retailers are in the business of product sales, not brand growth and the pressure for businesses to deliver high sales turnover is often to the detriment of brands.
So, as brand champions, how can we ensure we’re maintaining the right amount of long-term focus on our brands? Well, I couldn’t agree more with Peter Field’s insights. Especially for Challenger Brands, the balancing act of short and long-term is critically important to get right. We need to change our focus back to brand building campaigns, attracting new users to the brand and not just taking the easy wins through short-term campaigns measured by ROI. Adopting a true Challenger mind-set to ensure your brand has the courage to step outside of the purely short-term and embrace long-term growth will lead your brand to long-term commercial success.