Data Shows the Short-term Approach to Marketing is Hurting Businesses

When brands focus on immediate returns, marketing returns suffer. Here’s how.

Magnetic Media is always a good go-to source for the magazine industry. Now, they offer a new report on the dangers of “short-termism” in ad strategy, with its emphasis on immediate results.

“Short-termism is a threat to marketing effectiveness and shareholder value,” the report begins. It explains that CEOs are often reluctant to embrace long-term strategies because of pressure to show immediate results. And with more corporations linking performance to executive pay, the pressure mounts.

Not surprisingly, this could be having a very bad effect on overall marketing effectiveness, as ad budgets skew toward the immediacy of digital over the long-term benefits of magazine ads.

The problem, as the report notes, is that magazine media is “closely associated with delivering long-term results.” If the emphasis is on short-term “activation” results, marketing is aimed at immediate conversion. But that fast activation is not so easy without the long-term benefits of brand awareness.

So, what’s the right approach? According to the data from the Magnetic study, it seems “balance” is the right answer.

The researchers studied 114 UK campaigns and 46 magazine campaigns specifically and came up with some interesting conclusions about the addition of magazine ads into brand campaigns.

“Their recommendation was that the optimum performance mix of the two was a budget allocation that committed 60 percent to brand building and 40 percent to activation,” the report notes. Campaigns that focused more heavily on brand building had a drop in conversions, while an overemphasis on activations diminished long-term business lift.

Overall, the researchers found that campaigns that include this 60/40 ratio saw a 74% uplift in market share gain, and 161% boost in customer acquisitions. This ratio is also the sweet spot where brands saw good results on more immediate returns, like trial offers, site visits, CTRs and other direct response metrics.

In other words, putting enough efforts into long-term building through magazine ads has a major uplife factor on short-term metrics too.

“The ability of magazine media to deliver against activation effects is the most significant piece of new evidence in this report,” the researchers note. “Activation and short-term are often used interchangeably but are not traditionally associated with magazines.”

Until now. As the data shows, magazine media have both long and short-term effects when added to other channel strategies, delivering large business effects over time. And those impacts are increasing; the uplift effectiveness has in fact been growing, up 25% over the past four years.

For brands caught in the trap of short-termism, this report may offer some insights on the importance of stepping back and adjusting for a longer view. And for anyone in the magazine business, it’s good to know just how valuable your real estate truly is to brands.