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Hitting a business growth plateau can be jarring, but it doesn’t have to be your new normal.
When your once-stellar marketing strategy isn’t delivering results, it’s time to take a step back and reevaluate where you’re spending your ad dollars. Read on to learn more about how to overcome a performance plateau by ditching old habits and investing in future-proof digital marketing.
Chances are, you’ve heard the phrase “performance plateau” thrown around.
Many people talk about performance plateaus in sports, training, or the workplace. It’s essentially when you reach a point where no matter how hard you train or work your progress seems to stagnate.
And while much of the emphasis is on how performance plateaus can affect individuals, they can also affect brand performance. MarketingWeek explains that the business growth plateau happens when brands reach a point where the success of their traditional marketing mix levels off. Their original marketing campaigns are no longer effective and brand growth has stalled.
PERFORMANCE PLATEAU
Hitting a performance plateau is especially stressful for brands with a performance mindset. When the numbers stall, it can seem like all is lost.
Experiencing a plateau in performance isn’t just an issue for new or growing brands. It can happen to anyone, anytime, for a variety of reasons.
From small businesses to medium B2B brands to major players in the B2C space, new and well-known legacy brands alike can experience a growth plateau. However, one common theme among brands that experience a performance plateau is their emphasis on performance marketing rather than marketing performance.
As you’ll see soon, measuring performance can only take brands so far.
It can be difficult for brands to pinpoint the cause behind their plateau in performance. After all, it’s startling when your typical marketing strategy simply stops delivering results.
But we’ll let you in on a little secret: Using the same performance marketing strategy and expecting the same results over time isn’t sustainable.
When brands look for ways to cut their budget and focus on bottom-of-funnel performance marketing that’s worked in the past, their numbers stagnate.
The experts at McKinsey echo this sentiment. Data-driven performance marketing is often preferred among advertisers because it delivers concrete, measurable results. On the other hand, brand performance marketing (which we’ll get to in more detail soon) can be more difficult - but not impossible - to measure.
McKinsey explains that, because of this, many CMOs shift their marketing spend to capture customers at the bottom of the funnel. With performance marketing, it’s easy to justify this spend, but it comes at the expense of top-of-funnel marketing that can generate customer demand and capture consumer attention.
This emphasis on bottom-of-funnel campaigns may deliver some immediate positive results but simply isn’t sustainable. The pool of customers ready to make a purchase will soon dry out and without a strong top-of-funnel campaign there won’t be more coming down the pipeline.
All of this is to say that having a sole focus on performance marketing is often what causes brands to plateau. It’s a short-sighted solution that ignores the benefits of creating meaningful connections with customers and building brand loyalty.
Ultimately, the difference between hitting a performance plateau and reaching new heights comes down to a solid understanding of marketing. And for this article, we’re focusing on the nuances between brand marketing and performance marketing.
Let’s start with the former. Brand marketing is all about creating a strong brand identity over time. It involves appealing to a consumer's emotions, creating brand awareness, and improving brand perception. By perfecting brand messaging and identity, you begin to connect with consumers over time.
However, measuring brand performance can be a challenge. There are no direct ways to identify how brand marketing contributes to sales and results can take a while to see.
Performance marketing, on the other hand, is all about meeting the immediate needs of reaching your target audience and generating leads and/or sales. It’s a data-driven approach that’s a lot more tangible for brands to understand - and justify.
As you can see, both types of marketing serve an important purpose. But this is often lost on decision-makers when dollars are on the line. Less than two years ago, Forbes reported that 70% of marketing professionals expecting budget cuts predicted they would make them to brand advertising. Performance marketing was expected to be among the least affected areas of investment.
Brand performance marketing is more important to a brand’s long-term success when compared to performance marketing. According to HubSpot, one of the best known brands in B2B Software, some of the benefits of building a strong brand include:
in a saturated market. Consumers are always faced with choices. If they recognize your brand, they are more likely to choose your product or service over a competitor.
Consistent, memorable branding builds credibility and trust that keeps your customers coming back to your brand instead of trying something else.
Speaking of consistency, branding can be the foundation of all your marketing efforts. Without a solid identity, your ads and marketing content - no matter where it falls in the funnel - won’t be as effective.
Get consumers excited about your brand with cutting-edge ads and experiences they can’t help but talk about or share on social media. Even if they don’t make a purchase, this type of marketing is invaluable to a business.
When you create a strong brand identity, it helps shape workplace culture. Your values and vision can help boost employee morale and retention while also attracting top talent.
Though intangible, the benefits of branding are undeniable. It’s a long-term investment that has a high return when given the budget and time to succeed.
Luckily, hitting a growth plateau doesn’t have to be your new normal. When the numbers start to stagnate, don’t panic! It’s time to step back and evaluate your current marketing strategy.
Chances are, you’re focusing too much spend and time on bottom-of-funnel ads. Maybe you were getting leads in the beginning, they’ve now started to taper off. Maybe you’re seeing the KPIs dip several weeks in a row. Either way, here are some steps to overcome the performance plateau or avoid it altogether.
While it can be tempting to shift your attention to lower-funnel ads when budgets are tight, this can do your brand more harm than good. Rather, it’s time to invest in hyper-engaging top-of-funnel ads that capture consumer attention.
Flashy ads are more than a flash in the pan. They’re always evolving to engage new consumers and outperform industry benchmarks. And, of course, these top-of-funnel ads are always tailored to your brand.
No matter if you choose to utilize augmented reality or elevate your ads with gamification, they should always be branded so consumers can learn more about your brand.
Top-of-funnel marketing sets the stage for the rest of your marketing efforts. After all, the chances are slim to none that a consumer will engage with your brand if they’ve never heard of it.
Top-of-funnel ads with cutting-edge features do wonders to capture consumer attention and, in turn, improve brand awareness. It’s no secret that consumers see thousands of ads a day through different digital channels. They’ve become masters at tuning out ad noise. Focusing on capturing consumer attention is key to creating a strong marketing funnel from top to bottom.
As we said earlier, measuring brand performance marketing can be difficult, but is by no means impossible. Brand lift is one way to measure the impact of your ads on brand perception and performance. According to Survey Monkey, brand lift can measure how consumers perceive your brand, which doesn’t always translate to sales or leads.
Brand lift is often measured through surveys and can help your brand gain a better idea around:
These insights are invaluable for the marketing funnel. They allow your team to create relevant ads and successful campaigns. Another plus is that you don’t need to complete a campaign to measure how it is stacking up. Conducting surveys and tests midway through a campaign can give you insights into its effectiveness and allows you to make necessary in-flight adjustments.
And if you are looking for concrete numbers, the experts at Nielson found that a 1-point gain in brand metrics, like awareness, drives a 1% increase in sales.
Finally, we can’t emphasize enough the importance of balancing performance and branded ads. You need both for synergy!
McKinsey explains that a full-funnel marketing strategy and shifting how you view advertising is the key to long-term success. Performance marketing returns have plateaued in recent years with inflation in digital media costs and new buying behaviors in light of the COVID-19 pandemic. And the use of automation tools has made performance marketing commonplace, meaning there’s little room to gain a competitive advantage.
It’s time for brands to be more strategic with their marketing budget in order to stand out.
Balancing content for both ends of the marketing funnel helps create a future-proof marketing strategy. Not only are you able to maintain existing customers and generate qualified leads, but you’re also building a strong brand identity to stay top-of-mind with your audience.
Still not convinced about diversifying your marketing efforts? Large brands have already seen tremendous success by investing more in brand marketing to help them overcome the dreaded performance plateau.
Just take Airbnb. The well-established and known vacation rental company has made major changes to its marketing strategy in recent years that have paid off big time. The Wall Street Journal reported that in 2019, Airbnb began trying to depend less on search advertising and invest more in broad marketing campaigns to build its brand.
Like many well-known brands, it can be too easy to invest less in top-of-funnel marketing and take consumer attention for granted. But Airbnb took a different approach. In 2021, they reported that marketing expenses decreased by 28% from the last quarter, thanks to a decrease in performance marketing expenses.
This shift to brand marketing has clearly paid off. Though it took a few years, Airbnb has experienced its most profitable quarter to date. By balancing performance marketing and branding efforts, such as awareness-based digital ads, it has successfully lowered costs while increasing brand lift.
And your brand could experience similar results with the right partner by your side.
As you can see, performance is only one part of the marketing puzzle. To experience continuous, long-term success you need to invest in impactful, branded ads to capture consumer attention at the top of the funnel.
At MOBKOI, we know what it takes to create stunning branded ads that break the mold of traditional mobile marketing. And we always have the insights and metrics to back them up.
Learn more about how MOBKOI can help your brand avoid or overcome a performance plateau for continued success.
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