Dr. Grace Kite wrote a blog post on Gracious Economics titled The wrong and the real of it.

This article discusses the “55% brand, 45% activation” advertising model developed by Les Binet and Peter Field as explained in their books The Long and the Short of It and more recently Effectiveness in Context: A Manual for Brand Building. Binet and Field’s research is based on 18 years of data from the London-based Institute of Practitioners in Advertising’s databank, submitted by advertisers entering the biennial IPA Effectiveness Awards competition.

Kite challenges whether their lessons learned from major advertisers apply more broadly to less-established companies with smaller budgets.

« Econometricians like me see the real world long and short of it week in week out. We engage with the messy reality of life on marketing’s frontlines, where budgets are limited, CMO’s don’t last in their jobs, and CFO’s are skeptical. We see the role that advertising actually plays. »

« And the truth is that although [Binet and Field’s] chart is right about how advertising works, it’s often wrong about what the real world looks like… In our review of 20 years’ worth of past projects, that message holds up, but the real world teaches other lessons too. One is that many brands get years of significant growth by scaling up short-lived sales activation. Another is that following the orange line in the famous chart is not profitable for some advertisers and too risky for many others. »

«

  • Finding 1: Many brands do experience what Les and Peter’s chart describes…
  • Finding 2: Modern brands often grow by scaling up sales activation…
  • Finding 3: In the real world, brand-building is uncertain and risky.

»

« It is an immensely frustrating situation for marketing directors and CMOs. Most that I talk to are very familiar with the long and short of it, but they find its recommendations hard to put into practice. Brand-building often requires large budgets, and, as we have seen, there is a very real risk that it’s an investment that won’t pay back. »

« Real world brands need to learn from failures as well as successes. »

Kite presents an alternative chart, which she developed with Tom Roach.


Grace Kite also posted about her comparison of payback results from IPA-award entries and non-entries. “The conclusion is that award winners are better than other campaigns. it might be that the things they do are great guides for others, but it might be the things they do are unattainable for others. My point is we need to look more!

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