Investing in demand generation or branding? The false debate of marketers in times of crisis

Investing in demand generation or branding? The false debate of marketers in times of crisis

2024-11-02 08:30:00

The answer is simple: the debate between brand building and demand generation is misleading. Marketers must do both and leave behind two preconceptions.

Misconception #1: Investing in the brand only pays off in the long term

We know that investing in the brand pays off over time because it guarantees a lasting competitive advantage. But what we tend to forget is that a strong brand creates value every day. Tfirst of all by its ability to generate preference and demand continuously thanks to the relationship of trust that it builds with its customers. Then by its ability to justify a higher price, which could be described as a “premium” effect. Investing in the brand is therefore fundamental to creating a permanent, sustainable performance base and guaranteeing greater resilience in times of turbulence.

Landor’s recent study of the UK animal nutrition market shows a high correlation between brand strength and price per kilo. This clearly proves that having a strong brand is the best way to protect margin. However, without margin to finance future actions, it is impossible to continue investing in a demand generation strategy.

Misconception #2: Brand has no impact on demand generation activities

It is clear that demand generation activities create highlights and attract customers. However, the brand plays a key accelerator role. Because it offers more visibility both in the media and on the shelves, because it creates more desirability in the face of competition, a strong brand increases the impact of short-term actions tenfold. The best example is none other than Nutella and the real rush in stores in 2018 with its promotion at
-70%: the brand effect played an essential role in the enthusiasm generated in stores, well beyond the simple price reduction.

Investing in the brand is therefore essential, both in the long and short term. Because the figures speak for themselves: strong brands have a market share 3 times greater than that of weak brands, and companies that invest in their brand have 10 times greater profitability.

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**Short Interview with Marketing Expert, Sarah Matthews**

**Interviewer:** Good morning, Sarah! Thank you for joining us today to discuss the vital intersection of brand marketing​ and demand generation. With⁢ your expertise in marketing strategy, can you share your​ thoughts on​ the recent ⁣insights about the importance of brand marketing as highlighted in the latest article?

**Sarah Matthews:** Good morning! Absolutely, I’m glad to be here. The discussion around brand marketing versus demand generation is crucial ‌right now. Many marketers mistakenly think they must choose one ​over the other. However, the⁢ reality is that both are ‍essential for sustainable growth.

**Interviewer:** That’s a great point. The article mentions a misconception ‍that investing in branding​ pays off ‌only in the long term. What do you think about that perspective?

**Sarah Matthews:** That misconception is misleading. While it’s true that strong brand equity builds over time and can provide ⁢a long-term competitive advantage, the daily​ value of a strong brand cannot be understated. A well-established brand creates ‍continuous⁤ demand and preference among consumers, thanks to the trust it fosters. This trust often ⁤translates into immediate revenue as well, which is‍ why brands shouldn’t overlook their branding ⁢efforts.

**Interviewer:** Interesting!‍ So, how​ do⁤ you believe brands can effectively integrate ‌both brand building and demand generation into their marketing strategies?

**Sarah Matthews:** It’s all about balance and strategic alignment. Brands should‍ create marketing campaigns that weave ⁢both elements together. For instance, demand generation campaigns can drive ‌customers⁣ to action quickly, but integrating brand storytelling within those campaigns can enhance customer connection and loyalty. Marketers need to establish trust and engagement while ‌also pushing for immediate results.

**Interviewer:** Excellent ​insights, Sarah. Before we wrap up, what final advice would you give to companies aiming to reinforce their⁤ brand while also driving demand?

**Sarah Matthews:** My advice is to evaluate your current ‌strategies. Look for opportunities⁣ to blend storytelling and⁣ consumer engagement into ‌your demand initiatives.‌ By fostering a strong brand presence while strategically pushing for ⁣immediate conversion, companies can achieve sustainable⁢ growth. Remember, it’s not an either-or situation; it’s about how effectively you can do both.

**Interviewer:** Thank you, Sarah, for sharing your expertise with us today. It’s clear that⁢ the ⁢balance ⁤of‌ branding and demand generation is⁤ fundamental for​ modern marketers.

**Sarah Matthews:** Thank you for ​having me! It’s always a pleasure to discuss these critical topics.

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