Your Focus on Performance Marketing Is Killing Your Brand (But It Doesn’t Have To)

Why the divide between brand and performance marketing is destroying long-term value—and how to fix it.

It’s Time to Tear Down the Wall Between Brand & Performance

Tell me if this sounds familiar.

Your quarterly marketing budget meeting just wrapped. Tough calls were made. With pressure on revenue, the leadership team decides—again—to lean harder into demand generation. Performance gets the dollars. Brand is put on hold “just until things improve.”

It feels defensible. The attribution dashboards look clean. Pipeline is traceable. Conversions are measurable. And nobody wants to argue with good data.

But then the realization hits:
This is the same decision you made last quarter. And the quarter before that. And the one before that.

When was the last time brand marketing was fully funded?

The Data Is Clear: Over-Investing in Performance Shrinks ROI

Performance marketing’s tight attribution makes it look like the safest bet. But the most robust industry research tells a different story.

A joint report from WARC, Analytic Partners, System1, Prophet, and Bera.ai found:

“Businesses that over-invest in performance marketing can reduce ROI by 20–50%.”
A balanced mix of brand + performance can increase ROI by 25–100%, with an average lift of 90%.

This aligns with the widely cited 60/40 rule from Binet & Field’s IPA effectiveness studies. Roughly:

• 60% to brand building (for long-term growth)

• 40% to performance activation (for short-term demand capture)

WARC calls this the multiplier effect—because the two sides don’t add together.
They multiply.

As WARC’s Asia-Pacific SVP Edward Pank puts it:

“It’s not brand plus performance—it’s brand times performance. Integrated correctly, the effect is exponential.”

Why Companies Stay Stuck in the Performance Trap

Most marketers know brand and performance matter. But performance marketing has something brand rarely does:

Immediate, quantifiable numbers.

The trap looks like this:

• CPA rises quarter over quarter

• Promotions and discounts become more frequent

• Organic and branded search decline

• Margins thin

• Leadership pressures marketing for “more efficiency”

• Brand spend gets cut again

Meanwhile, Nielsen’s long-running on/off-air studies show:

Brands lose ~2% of future revenue every quarter they stop brand advertising.

McKinsey calls this the “leaky bucket effect.”
Performance keeps scooping water, but the bucket keeps draining from underneath.

Brand Marketing’s Secret Weapon: Pricing Power

Here’s the part your CFO needs to hear:

The biggest ROI driver for brand investment isn’t awareness or impressions—it’s pricing power.

Research from McKinsey, BCG, and Deloitte repeatedly shows:

• A 1% increase in price drives 8–12% increase in operating profit.

• Strong brands command 5–25% price premiums.

• Pricing resilience compounds across every unit sold.

In other words:

Brand drives margin. Performance drives volume.
You cannot optimize one at the expense of the other.

And yet—pricing power is rarely measured, tracked, or attributed back to brand spend.

That’s the gap killing long-term marketing credibility.

This Is Where Marketing Silos Must Come Down

You cannot defend brand budgets using brand-only metrics.
You can defend them when marketers and finance leaders adopt a shared value model:

Brand Metrics → Pricing Power → Margin → Enterprise Value

Stop trying to win the budget conversation with “awareness” and “reach.”

Start using:

• Price elasticity

• Pricing premiums

• Baseline sales (from MMM)

• Branded search growth

• Incremental revenue from brand lift

These are CFO-, CRO-, and CEO-friendly metrics.

They shift the story from:
“Brand is a cost.”
to
“Brand is the engine of margin expansion.”

The Path Forward: Kill the Silos & Rebuild the Funnel

To create sustainable growth, companies need to operationalize three commitments:

1. Adopt the 60/40 Brand–Performance Mix

Not dogmatically—but directionally.
Use category maturity and competitive dynamics to fine-tune the ratio.

2. Integrate Measurement Across the Funnel

Move from siloed metrics to a shared dashboard:

• Brand equity

• Pricing power

• Long-term ROMI (via MMM)

• Incrementality of performance channels

• Marginal CAC over time

• Lift in branded search and direct traffic

3. Tell One Unified Story to the C-Suite

Brand and performance should speak with one voice:
“Here is how we create demand, capture demand, and grow margin—together.”

When the internal narrative shifts, the budget follows.

The Bottom Line

Performance marketing isn’t killing your brand.
Over-reliance on performance marketing is.

And the longer a company waits to correct the imbalance, the more expensive it becomes to fix.

But the good news?

You don’t have to choose between short-term efficiency and long-term growth.
You can have both—if you integrate your teams, rebalance your spending, and measure brand the way it actually creates value.

A Final Call to Action

If your organization is serious about sustainable, defensible growth:

✔ Break down the silos between brand and performance

✔ Commit to a 60/40 investment mix

✔ Start measuring pricing power as the true ROI of brand

✔ Align your teams to one full-funnel strategy

✔ Build a growth engine that compounds every year

Your future margins—and your future customers—will thank you.