How To Split A Marketing Budget Between Brand And Performance

Start at 60 per cent brand and 40 per cent performance for a consumer business, or 46 and 54 for a B2B one, then adjust for your own sales cycle and cash position. Those starting points come from Les Binet and Peter Field, who analysed the campaigns in the IPA's effectiveness databank in the UK.

The figures are useful because they give the argument a starting line. A marketing director can defend a number with a source behind it, and a board can see what moved it and why.

Where the numbers come from

The 60 and 40 comes from The Long and the Short of It, published by the IPA in 2013. The B2B figures of 46 and 54 come from their later work with LinkedIn's B2B Institute in 2019.

Read them for what they are. They are averages drawn from campaigns entered for effectiveness awards, mostly from overseas markets, and they show patterns rather than proof. They will not tell you the right answer for a Sydney engineering firm, but they do show that businesses putting everything into short-term capture tend to fall behind over time.

The reasoning underneath matters more than the exact split. Performance activity catches people ready to buy now, and its effect fades quickly once the spend stops. Brand activity reaches people before they are in the market, and its effect builds over years.

What counts as each

The split falls apart if nobody defines the two sides, so write this down first.

Brand is anything aimed at people who are not buying yet: video, PR, sponsorship, and content that teaches the market who you are. Performance is anything aimed at people ready to act: search ads, remarketing, Shopping and lead forms.

A few items cause arguments. Paying for your own name in Google Ads is capture, even though the word "brand" appears in the campaign name. Daily organic content does both jobs, so count it as brand unless it carries a direct offer. Leave the website out altogether, because every dollar on both sides of the split depends on it.

When to move the split

A few situations justify moving away from the starting point:

• Few buyers in the market at once. Professor John Dawes' 95-5 work for the B2B Institute estimates that only about 5 per cent of B2B buyers are in the market at any time. A long buying cycle argues for more brand, since the people you most want are not looking this quarter.
• A new category or new market. There is little demand to capture until people know the thing exists, so brand has to come first.
• A need for work this quarter. Lean to performance for one or two quarters, and write down the date the split returns.
• Search demand you already own. If your name draws strong branded search, part of the capture job is already being paid for by past brand work.

Keep the change in steps of 5 to 10 points a year. Larger swings make it hard to tell what caused what.

How to protect it

Brand spend is the first thing cut in a bad month, because the damage shows up long after the decision. Set the split annually, put it in the board papers, and require a written reason to move money out of brand during the year.

Then give each side its own measures. Performance answers to cost per qualified enquiry and revenue. Brand answers to branded search volume, direct traffic, the conversion rate of cold traffic and what buyers write in the "how did you hear about us" field.

One owner for both

The split turns into a fight when different people hold each budget, and each one is measured only on their own line. Put both under one owner and the same shoot can supply both sides, with a reel that wins organically becoming the next ad.

That is how we run it: content and paid on one team, reported against revenue. A budget split only works when someone is accountable for the total.