A Guide For Perplexed Communicators

BERA CMO, Scott Turner is a methodical optimist who believes that great marketing is a potent combination of persuasion and pivot tables.

Return on brand investment is the ratio of incremental value produced by brand growth divided by the amount of investment in brand growth. Maximizing ROBI requires brand communicators to adopt a brand investor mentality. Like their counterparts in the financial realm, brand investors will want to cut their brand losses and double down on their brand winners. This requires collecting data—and a lot of it. However, that’s easier said than done. As someone who works in the predictive brand technology space, here are three suggestions for how to use data to maximize ROBI:

Understand the brand investment problem.

Pity the chief financial officer who writes a check for large brand budgets after hearing bold promises of imminent success from the marketing team but still wonders what payoff, if any, they can expect. Pity too the chief communication officer, chief marketing officer, chief brand officer and brand management and communication teams everywhere. Their colleagues in other departments see the effects of great branding and communication campaigns in their personal lives and at other companies and are full of advice and pointed questions for their own brand and comms teams.

Retail legend John Wanamaker once said, “Half my advertising spend is wasted; the trouble is, I don’t know which half.” While Wanamaker was assessing advertising effectiveness decades before the emergence of digital marketing, the same complaint applies to brand spending today. Unlike digital advertising and performance marketing, which can be tracked, monitored, analyzed, sliced, diced, and pureed, investments in brand are notoriously difficult to tie back to impact on brand equity or incremental revenues. It’s often a brand data problem.

As challenging as it may be to confidently invest in brand equity, the results of other companies’ successful brand-building efforts are all around us, even if they are tantalizingly out of reach. A few questions to consider:

• What are today’s winners like Coca-Cola, Starbucks, Amazon and Apple doing right to maintain their brand advantage?

• How did past brand winners fall?

• What could brand leaders and comms teams have done to anticipate their crumbling brand equity and revenue?

• Equally important, what could they have done to halt and reverse the slide toward brand boredom or brand divorce?

Top-performing brands do a good job of building familiarity, regard, meaning and uniqueness. Often, these brand investment decisions took place months, quarters or even years ahead of those business outcomes. If brand bets are placed correctly, brand equity and revenues grow. If brand bets are placed poorly, that brand budget is wasted and the brand atrophies, revenues stagnate, financial projections are missed and confidence in the brand and communications team is lost. Just as financial wizards rest their decisions upon data, excellent brand decisions require excellent brand data.

Measure your brand against the best to stand out from the rest.

Maximizing your ROBI depends on looking not just at your own brand and industry, but multiple brands across multiple industries. Why? The most accurate perception of your brand relies on context and culture when your brand is measured not just against brands in its own category but against brands across categories. As Warren Buffett said, “A horse that can count to 10 is a remarkable horse, not a remarkable mathematician.” In other words, don’t judge your performance against your mediocre peers. Compare yourself to the best!

Take for instance a consumer in need of a vacation. Your brand might be the very best airline brand, but you’re in trouble if your consumer thinks more highly of unwinding with a staycation that includes a local luxury hotel stay, some great local dining and in-room movie streaming. The airline brand might fall short of that alternative local package. So it would behoove you to compare yourself to other top-performing brands and travel experiences—not just your airline peers—when it comes to investing in brand equity.

Look beyond market research to decode customer and noncustomer perceptions at scale.

There’s an old proverb: “The best time to plant a tree was 20 years ago. The second-best time is now.” Contrary to limited scope, limited time-frame market research on your own brand, you need ongoing intelligence across multiple industries and brands. To ensure reliability over time, focus on continuously populating the same robust data stream in the same way over months and years. If you want real-time insights, you’ll also need to collect that data every week. And to ensure you trust your data, you will want to collect a lot of it and track that it reflects the real population (ideally with census matching for customers in the United States). This is expensive but it can be done.

To that end, here are some dos and don’ts for maximizing your ROBI:

Don’t

• Don’t only compare your brand performance to your industry peers. Instead, collect information on brand leaders across industries to learn what they are doing right.

• Don’t waste brand budget, time and effort pursuing vanity metrics like press mentions, website visits or net promoter scores. These are all fine data points, but they do not indicate effective or efficient brand spend.

Do

• Focus your brand investment on metrics that matter including your brand’s familiarity, regard, meaning and uniqueness.

• Consistently track your FRMU performance over time, across geographies, demographics, customers and noncustomer segments.

• Use the FRMU data you gather to build a plan of attack that activates your five marketing P’s: product, place, price, promotion and people.

In conclusion, your brand spend is more than just another marketing budget line item. Brand is an investment in your company’s future. Brand investments, when well placed, can build long-term value that ultimately paves the way for better business outcomes such as increased revenue and enterprise value. Bland brand creates bland demand. How do we avoid this? The answer is to set up ongoing data collection on brand metrics that matter, such as familiarity, regard, meaning and uniqueness—and act upon those findings with the coordinated focus of your product, place, price, promotion and people.


Forbes Communications Council is an invitation-only community for executives in successful public relations, media strategy, creative and advertising agencies. Do I qualify?


https://www.forbes.com/sites/forbescommunicationscouncil/2022/05/06/the-role-of-data-in-maximizing-return-on-brand-investment-a-guide-for-perplexed-communicators/

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