Insights
Why, and how much, should you invest in brand?
Brand creates real value. The problem is that we've spent years trying to measure a long-term investment with short-term tools.
Pranav Piyush
Co-founder, CEO
Why, and how much, should you invest in brand?
Every CMO has had this conversation: revenue slows, finance starts looking for budget to cut, and brand marketing is usually first on the list. Performance marketing has dashboards: spend, leads, CAC, ROAS. Brand has… awareness.
It’s easy to assume that performance drives revenue, and brand is a nice-to-have.
The assumption is understandable. It’s also wrong. Brand creates real value. The problem is that we’ve spent years trying to measure a long-term investment with short-term tools. Worse, we judged brand through click-based attribution, even though many brand campaigns, from TV to billboards to video, were never designed to be clicked in the first place. But until recently, there wasn’t an easy way to measure brand that got either of those right.
"Can't measure” and "doesn't work" are different claims
Performance marketing produces clean, trackable results: “We spent $100K and got 5K leads.” Brand marketing requires a leap of faith: “We believe brand awareness improved.”
Given those two sentences, any CFO will fund the first one. That’s not finance being obtuse, it’s finance doing its job. Money should go where the return can be shown, and for a long time, brand simply couldn’t show it the same way.
But “can’t measure” and “doesn’t work” are different claims.
Brand marketing’s impact doesn’t disappear just because we fail to measure it. If anything, it becomes most obvious when we stop investing in it. A 20-year study of consumer goods brands by the Ehrenberg-Bass Institute for Marketing Science found that brands that cut all advertising see sales fall 16% after one year, 25% after two years, and 36% after three. A steady fall downhill.
BCG’s latest brand research puts a price on reversing that trend: every $1 cut from brand spend today costs companies $1.92 in future investment just to win back the market share that was lost, up from $1.85 in 2022 — which strengthens the view held by the 76% of marketers who believe cutting brand spend does more damage today than it did five years ago.
Together, these studies point to the same conclusion: brand isn’t an effect that’s absent when unmeasured. It’s an asset that depreciates when unfunded.
Just a theory? Not quite. Ask Nike, X, or Uber:
Nike: Lost $167M in Market Cap over 3 years with a series of major strategic marketing changes
X (Twitter): $5.9bn in lost ad revenue due to content moderation changes
Uber: 400,000 riders deleted their accounts and switched to Lyft because of a single Tweet
None of these happened in a vacuum, but in each case the proximate cause was a shift in how the public perceived the brand, not a product or pricing failure.
Why brand doesn't show up in this week's numbers
If brand’s effect is this real, why does it seem invisible?
Because of a simple, well-documented fact about how customers actually buy, called the 95-5 rule: at any given moment, ~95% of your potential buyers aren’t ready to purchase. Only about 5% are in-market.
Performance marketing is built almost entirely to reach that 5%. It’s demand capture, not demand creation. And it’s highly measurable precisely because it’s aimed at people who click, tap or convert — the exact things a dashboard is built to count.
Brand marketing’s job is the other 95%, and a lot of it runs on channels that were never clickable to begin with, like a TV ad or a billboard. What it does is address mental availability — the probability that your brand comes to mind in a buying situation, creating a head start with the vast majority of buyers who aren’t ready today but will be eventually. And even when that head start does convert somewhere trackable, it still shows up on a delay: Nielsen research for Google found that a 1% increase in brand awareness produces a 0.4% increase in short-term sales and a 0.6% increase in long-term sales.
That delay is also why most measurement setups miss it. A 2024 Google/WARC analysis found that the return a campaign generates in its first four months roughly equals the return it generates over the next 20 months combined — a window most attribution models close the book on long before it plays out.
This is why “brand marketing doesn’t drive sales” is simply wrong. It may not drive this week’s sales, but it drives the sales that show up as baseline demand next week, next month, or for months after that. It might also be driving sales today, but you can’t see it because your dashboards only track folks who click through a digital ad.
Brand and performance aren't competing strategies
The biggest misconception around the topic is that companies need to choose between performance and brand, as if they’re separate motions.They aren’t. Every marketing dollar should ultimately drive business results. The difference is simply what each is designed to influence, and when those results become visible.
The long game makes the short game more effective. When more buyers already recognize and trust your company, performance campaigns don’t have to work as hard to generate conversions. Instead of creating demand from scratch, they capture demand that’s already been built.
That’s not just a theory about how people buy. A 2025 WARC and Tracksuit study of over 100 e-commerce brands found that a 10% increase in ad spend produced 13% sales growth for high-awareness brands, versus just 6% for low-awareness ones — roughly double the return on the same dollar, in the same channel. The only real difference was how much brand equity was already in place.
Some of the best examples come from companies that deliberately paired both approaches:
Domino’s UK found that running brand and performance campaigns concurrently on YouTube produced a 45% increase in overall ROI from the platform.
Boots’ YouTube video “Take a Hike” built broad reach and long-term awareness. Running alongside it, a distinct 15-second ad promoting a loyalty card discount generated £5 back for every £1 invested. Both ads lived on the same platform, at the same time, doing different jobs, and each performed better for staying focused on its own purpose.
Meta ran a meta-analysis of 35 brand lift studies across 34 advertisers and found that direct-response campaigns with strong branding simultaneously lifted brand awareness by 10.9%, ad recall by 12.5%, and familiarity by 5.3%, while 94% of the campaigns still delivered a conversion uplift.
The question isn’t whether to invest in brand or performance. It’s how to build a marketing system where each makes the other more effective.
“It’s not measurable”: The old excuse doesn't hold anymore
For years, finance had a fair objection.
Brand marketing could demonstrate that something changed: awareness increased, recall improved, consideration went up. But it struggled to prove that those changes translated into business outcomes. A campaign people remembered wasn’t necessarily a campaign that generated revenue.
Today, marketers don’t have to rely on awareness metrics alone. They can measure whether a brand campaign caused incremental business results through controlled experiments, quantify how much revenue brand contributes over time using Marketing Mix Modeling (MMM) and Incrementality Testing, and separate short-term campaign lift from the baseline demand the brand generates on its own.
That’s a fundamentally different standard of evidence.
The conversation is no longer: “We think this campaign improved awareness.” It’s: “This campaign generated incremental demand, and our MMM shows brand’s contribution to sales has increased over the last three quarters.”
That’s the kind of evidence finance has always asked for. And that’s the problem Paramark is built to solve. Rather than treating brand and performance as separate worlds, it measures them together, combining incrementality testing, MMM, and other modern measurement approaches to show how each contributes to revenue, both immediately and over time. Here’s a deep-dive on the methodology.
The next budget conversation
There’s a reason this matters more today than it did five years ago. GenAI has made it cheap for every competitor to produce more content, faster, which means more brands than ever look and sound the same. When distinctiveness gets harder to claim, it gets more important to prove.
For years, the debate around brand investment wasn’t really about whether brand worked. It was about whether marketers could prove it. Finance funded what produced measurable evidence. Marketing believed in value it couldn’t fully demonstrate.
That’s no longer the case.
So the next time this conversation comes up, the move isn’t to defend brand harder. It’s to bring the CFO a number they can check: a brand lift result, an incrementality test, an MMM output showing baseline demand rising alongside campaign spend.
That’s no longer a leap of faith. It’s a line item with measurable returns.
At Paramark, we help marketing teams measure brand and performance together, using MMM and incrementality testing to show finance exactly what each dollar of marketing spend is returning. Curious what your own baseline vs. incremental split actually looks like? Schedule a demo to find out.
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Book a demo now and you'll get a live, expert-run walk through of how Paramark can help you with incrementality measurement and experimentation.
