Performance Marketing vs. Brand Marketing

Alongside many others, the telecoms industry has had a rocky few years. Tighter margins, increased competition and tough economic conditions have led customers to hold onto devices for longer, which means profits have been squeezed. It’s been felt throughout the industry, including at Three UK.

Head of Marketing and Communications Chris Gough admits that, after a tough period of slow growth, the telecoms giant has taken a step back and refocused its marketing efforts. Part of that refocus has been to defend the balance between performance marketing and brand marketing.

Before we get stuck into Three UK’s experience, what is the difference between performance marketing and brand marketing? They are 2 different approaches with distinct goals, strategies and metrics.

Performance marketing is also known as direct response marketing. It’s focused on driving specific, measurable actions or conversions. The primary goal is to generate immediate and quantifiable results, such as sales, leads, clicks or app downloads. Performance marketing campaigns are typically designed to drive a specific call-to-action and are highly trackable, allowing marketers to measure the return on investment directly.

Facebook or Google ads that drive leads are examples of performance marketing campaigns. They tend to make use of data and analytics to optimise campaigns and make sure you’re targeting the right audience segments.

Brand marketing, on the other hand, is focused on building brand awareness and reputation. The primary goal is to create an emotional connection with your audience, shape perceptions and establish a distinct brand identity. Brand marketing campaigns are typically broader in scope and aim to reach a wider audience than performance marketing campaigns. They might use storytelling, creative visuals and memorable experiences.

Brand marketing examples include social media posts that focus on storytelling and blog content for your website. It’s typically harder to measure in terms of immediate sales or conversions, as its impact is often seen over the longer term.

Both types of marketing and brand marketing have different objectives, but they’re both important and can work well together as part of an integrated marketing strategy

Gough is fully invested in the importance of brand marketing but recognises that it can be harder to sell its value to his board.

He said:

“When things get tough, I’ve never had a conversation about cutting performance marketing.”

“Calling it performance marketing is one of the worst things that ever happened to the industry. It’s sort of “snuck in” in the last decade and gives the wrong impression to the finance department. When you’re talking to the finance director, they go, ‘Oh, well, that’s the thing that performs’,” compared to brand.”

He advises the best way to sell brand marketing internally is to understand the needs of your stakeholders and communicate the benefits in a way they’ll understand:

“You’ve got to be able to speak the language of the board and get really comfortable with linking it back to metrics and numbers, and be really clear explaining that to them.”

When Three UK launched back in 2003, the brand experienced rapid growth. It was an instant hit. But the early success was largely built on targeted advertising rather than brand building. Conversely, competitors in the market, such as Vodafone and EE (formerly Orange) enjoyed very strong brand identities.

As time went on, the exclusive features and lower price points that Three UK based its marketing on became industry norms. The brand had directly targeted a young audience to drive growth but that tactic also began to run out of steam.

Without a strong brand identity to keep it buoyant, the company struggled to grow. Gough joined in 2022 and said:

“We weren’t getting the same number of subscribers and we had to take a step back and look at the whole brand. It wasn’t a quick fix.”

Three UK launched a brand platform — Life Needs a Big Network — that has breathed new life into its marketing. That, alongside a renewed focus on driving customer loyalty, has seen the company enjoy steady growth again. According to Gough, the brand platform has proved “absolutely critical”.

For small businesses, performance marketing is typically a vital part of your marketing activity. At the end of the day, you need quality leads that stand a good chance of converting. You can’t survive on a good brand alone.

But that doesn’t mean you should ignore your brand. A strong brand identity will help maximise the chances of those leads converting. If your prospects understand your proposition and buy into who you are and what you stand for, they’re much more likely to do business with you.

A strong brand can also drive customer loyalty. Your brand is your company’s personality. If people like it, they’ll be inclined to keep coming back to you. In contrast, a buying experience with a company that is purely transactional, with no brand personality whatsoever, is unlikely to stick in customers’ minds or lead them to recommend you to others.

In a nutshell, don’t put all your eggs in the brandbuilding basket, but don’t leave it empty either.

Could your business do with a bit of brand building?

Take some time to define your brand's core values, personality and unique selling proposition. Are you serious, ultra-professional and thorough? Or fun, laid back and playful?

With your values in mind, think about how your visual identity communicates who you are, including your logo, colour palette and consistent design elements across all your customer touchpoints.

Your copywriting should reinforce your brand identity, too. For example, a children’s clothing retailer could get away with puns and jokes on their website but a law firm could not. Your brand tone of voice should be consistent throughout all of your communications and marketing material.

With a bit of effort, you can establish a strong brand identity that will connect with your customers and maximise the impact of those targeted performance marketing campaigns.