$1.85 per $1
WarningBrand Strategy
Winning back share costs nearly twice what cutting the budget saved
Regaining lost market share typically requires a disproportionate reinvestment: approximately $1.85 for every $1 initially saved through marketing cuts. Cutting is not a pause, it is a retreat that has to be bought back at a premium.
Source
The Effectiveness Equation - Google Market Insights EMEA, with Kantar, Nielsen, Ekimetrics, Ipsos MMA, the Behavioural Architects and WARC (2025)
Michal Protasiuk, Ahmet Bas, Jonas Christensen, Vanessa Bruns, Emily Allen and Jonny Protheroe (Google Market Insights, EMEA)
p. 3 and p. 60, The Effectiveness Equation (2025), BCG brand impact analysis of nearly 150 major US brands across 15 industries, July 2022
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PrincipleMarketing measures itself on only one side of the profit equationStatMost organisations have no agreed definition of what marketing effectiveness meansStatBrands with pricing power command roughly twice the price of brands without itStatPricing power comes from meaningful difference, not from salienceCaseA UK skincare brand turned a 2% revenue increase into 7% by lowering its price elasticity firstPrinciplePromotion-heavy communication raises price sensitivity; balanced brand building lowers itStatPricing power and resistance to price rises correlate strongly and measurablyStatHalf of advertising's sales effect arrives after the fourth monthStatMedia returns peak with roughly half to sixty per cent of the budget in brand buildingStatRaising brand awareness lifts short-term sales as well as long-term onesWarningEvery dark quarter costs future revenue that takes years to rebuildWarningShifting a shrinking budget into performance can destroy the returns performance depends on