The “Brand vs. Activation” Debate Is a Capital Allocation Failure

In marketing circles, there’s a lot of talk right now about two particular strands of execution “brand awareness” marketing, vs. “sales activation” marketing.

If you’re unfamiliar with these two terms, allow me to shed a glint of light on the subject. Contrary to what many people think brand awareness marketing is not a mood board, a color palette, and a logo. It’s the work of building what marketers refer to as distinctive assets so that, when buyers move from “out-of-market” to “in-market”, our brand pops up in their head and feels safest to them. Brand awareness marketing plants the seed in future buyers’ heads, so that we come to mind once they’re ready to purchase. An example of brand awareness marketing? Pretty much every Coca-Cola ad you’ve seen since at least the early 1970s.

Sales activation, on the other hand is the “buy one, get one free“, “free delivery for all orders received this month“, “also available in blue” type stuff. It’s about reducing choice friction with precision: the most appropriate channel, media, timing, message, and offer. It’s a sales assist, as opposed to a sales replacement. The best sales activation communication is often boring: communicate the offer, provide a time-sensitive driver, speed up the site, simplify forms, answer objections on the product page, that kind of stuff. Buyers don’t need another interruption; they’re looking for a smoother path to purchase.

Brand awareness advocates argue that such an investment compounds over time, improving customer loyalty, price resilience, and market share. It aims to keep the brand top-of-mind when buying decisions happen, even if those decisions occur months or years later. Critics, in contrast, note that awareness campaigns are harder to tie directly to revenue and can be inefficient if not paired with a clear path to purchase.

The strength of sales activation work lies in measurability and quick ROI, making it appealing for budget-conscious businesses or those under pressure to show short-term growth. However, an over-reliance on sales activation can erode long-term brand equity, leading to price sensitivity and ultimately diminishing returns as audiences tire of purely transactional messaging. Research suggests that the most effective marketing strategy is a blend of the two, with brand building as the foundation and sales activation layered on top to convert demand into actual sales.

But what’s actually going on in most boardrooms isn’t a battle of marketing philosophies at all. It’s a quiet but chronic capital allocation failure. The sort of failure that politely erodes enterprise value over the years while everyone congratulates themselves on being “disciplined” with budget. The choice gets framed as creativity versus performance; the reality is a choice between building an asset with a decent multi-year Net Present Value, or strip-mining it for short-term optics and patting ourselves on our backs on the improved quarterly report.

Why we treat Brand Awareness as a vacation and Sales Activation as a mortgage

Business owners and senior managers rarely admit they undervalue future demand creation. Instead, they say things like, “We can’t afford the brand awareness stuff this quarter,” which is like saying we can’t afford to repair the leaky roof because we’re too busy mopping the floor. Brand spend is CAPEX, aka capital expenditure. It builds a durable, interest-bearing asset – it’s just not one that accountants can physically touch. Sales activation spend, on the other hand, is OPEX – operational expenditure. OPEX keeps the lights on.It’s the everyday expenses associated with the day-to-day operations of the business.

The problem is we’re focusing too much on OPEX and spending little time on CAPEX. If our investment criteria are tuned purely to OPEX-type returns (i.e. quick, measurable, and immediate) we will never properly fix the roof and spend the rest of our corporate lives buying buckets..

Our over-focus on OPEX is an organizational bias towards what can be measured inside a fiscal quarter and dressed up as ROI. Managers who play to that bias get promoted. Those who invest in compounding value beyond the quarter are accused of being “fluffy” or “creative”, which is C-Suite slang for “we can’t model it, so it must be risky.” Yet the irony is that brand’s effects show up exactly where finance already looks: gross margins, LTV/CAC ratios, price elasticity, resilience in downturns. We’re just looking for them in the wrong timeframe.

Capital discipline isn’t about choosing one or the other, it’s about sizing both by volatility and horizon. The rational choice is to hold a blend. Use some short-cycle levers for the here-and-now, and some long-cycle positions for the later-and-larger. But the moment cost of capital rises, there’s an automatic temptation to dump the long-cycle stuff because its benefits are “harder to prove.” f we burned down our orchard because the apples took too long to grow, we shouldn’t wonder why our fruit bill keeps going up every year.

Attribution theology: The religion of measurement

Attribution is useful, but attribution as a belief system is dangerous. Our industry has built a giant telescope for spotting anything that happens within 30 days of a click, then concluded that anything outside that viewfinder doesn’t exist. It’s like the old joke of a drunk looking for their keys under the streetlight because the light’s better over there.

Brand investment suffers under this theology because its benefits are diffuse, delayed, and delightfully messy. It improves mental availability, primes category preference, and builds trust. All these things make activation cheaper and more effective. But because these benefits don’t show up neatly in last-touch marketing analytics software, they’re written off as “soft.” And so begins the doom spiral: we cut brand awareness to feed sales activation, sales activation becomes more expensive and less effective, so we cut brand awareness even further to “fund” it.

Before long we’re in a situation where we’re paying premium rates to rent the very attention we used to own.

I’m not saying the cure is to abandon measurement. I’m saying we should demote it from some kind of divine scripture, to decision support. Use mixed-media modeling, run incrementality tests, keep an eye on leading indicators like Share of Search. Above all, we should make sure the CFO hears the connection between brand spend and hard outcomes. If we can’t make that case, the marketing budget will be cut (and the CFO will be right to cut it)..

A portfolio view: Market Permission as the asset, Activation as the yield

Supposing we think of brand awareness marketing as a kind of “market permission.” The right to command a premium price, to be the default choice when the buyer’s brain is on autopilot, or to have the benefit of the doubt in a tender process. Then we think of sales activation as yield, or the harvesting of demand spikes as and when they occur. Framed in this way it should be glaringly obvious to anyone that these are complementary rather than rivals. Selling our brand awareness budget to fund more sales activation is just going to make our lives harder down the road.

From a portfolio perspective, brand awareness is our long-duration, low-volatility holding. Sales activation is our short-duration, high-volatility play. The weighting depends on many variables such as our market, cash position, and our competitive set. But regardless of that, we definitely need to have both in place. If we’re looking for proof, simply pause all sales activation efforts for a month. Does product demand evaporate, or just slow down? Now do the same for brand awareness, this time for a year (since brand awareness works on as different timeline). Now see if Customer Acquisition Costs have risen, or profit margins are sagging, even if top-line revenue stays steady. Businesses with genuine market permission can twiddle the sales activation dial up or down without there being a crisis.

Why the CFO and CMO should stop with the animosity already

Most “brand vs activation” arguments have less to do with marketing than with the bizarre incentive structures of corporate life. The CMO is paid to hit acquisition targets, the CRO to hit quarterly revenue, while the CFO to there to protect the cash position. What’s crazy is there doesn’t seem to be anyone on the payroll who’s paid to strengthen the company’s ability to grow more cheaply next year. As a result, funds flow to the activities that can be justified line-by-line in a budget, not to the activities that compound enterprise value.

Aligning the CFO and CMO isn’t about forcing them to see eye-to-eye on a piece of creative. It’s about getting them to agree that brand awareness is a real and valuable corporate asset, rather than a discretionary indulgence. That requires reframing the conversation in financial terms, rather than in media plans and campaign slogans. When the CFO sees brand investment as a form of capital formation, and the CMO can speak to its returns in the CFO’s dialect, the false dichotomy between brand awareness and sales activation starts to look as ludicrous as it actually is.

Competitive dynamics: We’re losing pricing power without noticing

By neglecting brand we don’t just lose share of voice. We lose the right to set the terms of the category conversation. Our competitors start defining the problem, shaping the evaluation criteria, and controlling the metaphors. We’re left competing inside a story of someone else’s making. We’re playing poker with their deck and under their rules, and the game’s probably fixed.

Meanwhile, the market’s tactical plays start to converge. Everyone uses the same “best practice” creative, the same offers, the same retargeting logic. Differentiation shifts from the substance of our offer to the price we’re willing to pay for the click. In that world, the only way to stand out is to either spend more or earn less — neither of which will get us a Christmas card from the finance department. In contrast, businesses that keep investing in permission often find their activation costs fall, their close rates rise, and their pricing power holds. That’s not because they hacked some algorithm, but because they pre-sold the market on trust.

Less with the debate on tactical, more on price return planning

“Brand or activation?” is the wrong question. We should be asking how do we price future returns, and how does that pricing shape our capital allocation. Get that right, and the budget almost writes itself. We’ll still have the occasional squabble over creative (no change there!) but we’ll no longer be trapped in the false binary that wastes so much executive oxygen.

Until then, most organizations will keep doing what they do now. They’ll continue to dress up a capital allocation error as a marketing philosophy, slowly trading away pricing power for the comfort of short-term provability. Then they’ll wonder why their P&L increasingly resembles one from a commodity trader. Once we fix the allocation logic, most of the rest should follow. Ignore it, and we’ll be stuck renting attention at market rates.

That’s assuming, of course, that we’re happy never to own it again.