Performance marketing wins internal budget arguments almost by default, because it comes with a dashboard attached — cost per click, conversion rate, return on ad spend, all visible within days. Brand marketing's effects show up slower and are harder to attribute to a single campaign, which makes it the easiest line item to cut when a budget gets tight. The research says that instinct is backwards.
The Research Behind the 60/40 Split
In 2013, Les Binet and Peter Field published research for the IPA (the UK's Institute of Practitioners in Advertising) analyzing close to a thousand documented advertising effectiveness case studies going back to 1980. Their finding: activation campaigns produce a sharp, short-lived uplift, while brand-building campaigns produce a slower but more durable, compounding effect on revenue, market share, and pricing power. Brands that allocated roughly 60% of spend to brand building and 40% to activation consistently produced the strongest long-run business results — the origin of what's now widely referred to as the 60/40 rule.
Why Performance-Only Strategies Plateau
A budget spent entirely on performance channels is, by definition, only reaching people already close to a purchase decision — it can't create demand that doesn't yet exist, only capture demand that does. Over time, that shows up as rising cost-per-acquisition and increasing reliance on discounting to convert, because the brand hasn't done the work of making people prefer it before they're in-market. Binet and Field's research links under-investment in brand building directly to eroding price sensitivity and shrinking margins over the following few years, not immediately, which is exactly why the cost is easy to miss on a quarterly dashboard.
The Ratio Isn't Fixed — But the Principle Is
60/40 isn't a universal law to apply blindly. A new entrant with no brand recognition yet often needs a heavier brand-building lean, closer to 70/30, before performance spend has anything to convert. An established, well-known brand can often lean further toward activation, closer to 40/60, since brand equity is already banked. B2B marketing tends to land differently still, closer to an even split. It's also worth noting this isn't unanimous among marketing scientists — Byron Sharp has publicly pushed back on treating the ratio as prescriptive rather than directional. The consistent, harder-to-dispute finding underneath all of that is simpler: a budget with zero brand-building investment is optimizing for this quarter at the expense of the next several.