Long-term vs. short-term marketing
If you’re familiar at all with marketing, you understand the importance of sales activation – it’s obvious, it drives fast results, and oftentimes is what clients want to see. Sales activation is undeniably important, but is only part of the marketing equation. Leaning too heavily on this ‘short-term’ thinking will undermine marketing effectiveness – boosting ROI but not overall profit that can’t be achieved without the long-term strategy of brand building. Compared to its counterpart, brand building burns slow and steady, and we see its power long-term. Long-term brand building is an investment, but is also a vital aspect behind all lasting and successful brands.
The slippery slope of short-term thinking
We live in a culture accustomed to instant results. It’s easy to get distracted by the quick turnaround of a sales activating marketing campaign. But chasing that high from quarter to quarter isn’t going to make your brand sustainable unless brand building is at your core.
Over the past five years, there has been a shift toward a more short-term marketing approach – causing many brands to suffer. Previously, brands relied on a ratio of 40% sales activation and 60% brand building to drive growth and success. Today, however, the majority of brands are implementing short-term thinking over long-term. The problem with this is that although a short-term, sales-driven approach can generate positive ROIs, the long-term success of a brand is more complicated than click-through rates.
“The problem is that the narrow focus of short-termism does not maximize profits by thoroughly tapping customer loyalty and satisfaction opportunities, but instead leads to customer churn, which destroys loyalty and strengthens competitors while raising customer acquisition and maintenance costs and lowering profitability.” – The Marketing Century
Retaining existing customers is often overlooked in short-term marketing, where the goal is to attract new customers for a short period of time, frequently losing sight of them afterward. Not only is this detrimental to brand loyalty, it is also costly. Sales Force reports that it is six to seven times more expensive to attract a new customer than it is to retain an existing one. Taking the time to nurture these already made relationships can increase both brand loyalty and revenue.
Finding the right balance
All of this is not to say that short-termism is not effective. It is vital to understand that sales activation and brand building are important, but not created equal. Ignoring either one of them will cause your brand to suffer. Relying solely on tightly targeted campaigns will often bring fast results, but ignoring long-term strategies will have a negative impact on overall market share. A brand’s reach, scale and emotion are necessary for success and can only be achieved through both sales activation and brand building. Finding this balance requires patience as well as strong and collaborative relationships internally to create a consistent brand voice and the right marketing mix for your business. Ultimately, finding this balance will save you money, and the overall health of your brand will thank you.