The advertising and marketing industry has let the term “Brand Advertising” come to mean “the only advertising that builds brand”.

This is VERY wrong. All advertising will build brand just as all marketing efforts need to build brand. Even worse, depending on your business needs, the emotional advertising specifically called “brand advertising” may be exactly the worst type of advertising to use.

So how do you determine if its right for you? One good starting point is the way brand advertising works financially.

Key Truth About Brand Advertising. The profit from today’s investment in brand advertising returns to you over a 5 to 10 year period. For massive multi-nationals, this may be just fine and brand advertising is often a smart choice. But most advertising clients can’t afford to spend millions today then wait for the profit years later.

Advertising Clients Should Be Classified According To Their ROI Horizon. Tonight in my Advertising Campaigns class I suggested we look at companies according to the point in time when they need profit from their advertising. Here are the three categories I gave them:

Short-term: Those companies who need advertising to pay for itself the first year. (These are often companies with less than $200M in annual revenue.)

Mid-Term: Those companies who need advertising to pay for itself within two to four years.

Long-Term: Those who can invest today without breaking even for 5 to 10 years.

Each Classification of Client Needs a Different Type of Advertising. I suppose there are some who would claim that if the client can’t wait 5 years, they shouldn’t be advertising. But that isn’t true and my agency has a bevy of case studies to prove it.

What was exciting tonight was that after laying out these categories, my undergraduate students had very clear ideas about how they would change advertising content if they were working for a short-term ROI client. Four stood out:

They needed the strategic goals to change to reflect this ROI horizon. (Strategic thinking that made this part-time professor happy.)

They suggested that the advertising required a stronger call-to-action – reflecting the truth that when you ask consumers to take action, they will.

They would create more product-oriented advertising – because product drives immediate action better than broad brand promises.

And they suggested that shorter term ROI clients would benefit from choosing media that is more promotional in nature.

And all this came up in a 15 minute discussion. Imagine the insights we’d get if the advertising business turned its full brilliance to this challenge.

ROI Horizon Should Start All Advertising Discussions. I’m sure I’ll get a few comments saying “it’s always in the brief”. But I don’t agree. Briefs often describe goals with words that, when you drill down, say little more than “do good things”.

Every advertising campaign should start with serious discussion of client needs, how they will measure ROI, and how much risk they can take before learning that the ROI will materialize. Unfortunately, it’s an exceptionally rare agency that knows how analyze a client situation this way then execute an advertising campaign that returns the right business result.

Education is a big part of the problem. Our Portland State advertising program is, fortunately, part of the Business School. But in today’s agency world, too many people (whether AE’s from J-school or creative’s from portfolio school) have essentially art or social science educations and are intimidated by business analysis. (In fact, some agencies reject applicants just because they have business training.)

Regardless, let me suggest that the next time your agency defaults to “brand advertising”, it should be your job to ask if that’s a good idea. And then open that discussion to all ranges of advertising and the business results each delivers.

All advertising builds brand. The key is to create advertising that delivers the business results you need while building brand.

Copyright 2011 – Doug Garnett – All Rights Reserved