The 60/40 Rule: How to Split Your Marketing Budget Between Brand and Performance

The Research Behind the 60/40 Split

In 2007, Les Binet and Peter Field published Marketing in the Era of Accountability, a comprehensive analysis of more than 1,000 campaigns from the IPA Effectiveness Awards DataBank. Their objective was to identify which marketing practices truly increase profitability. What they found upended the prevailing wisdom. Campaigns aimed at short-term sales gain were the most common objective but also among the least effective at driving durable business growth. Campaigns centered on profit growth or market share gain performed dramatically better, both in long-term impact and overall efficiency. The pattern was consistent across categories: approximately 60% of marketing budget should go toward brand building (creating mental availability, building memory structures, shaping long-term demand), and 40% should go toward sales activation (capturing existing demand, driving short-term conversions). This split maximized long-term profit growth. As Patrick Gilbert explains in Never Always, Never Never, the 60/40 ratio is not a rigid formula. It varies by category, by brand maturity, and by competitive dynamics. But the directional insight is powerful and consistent. Most organizations are dramatically under-investing in brand, and the consequences compound over time.

Enjoying this? Never Always, Never Never goes much deeper into the mental models and decision frameworks that shape how we think.

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Why Digital-First Brands Get This Wrong

For the last fifteen years, the entire premise of digital advertising was built on a single, unspoken idea: arbitrage. You could buy large amounts of website traffic at below-market costs and quickly convert that traffic into customers for a profit. Because the overarching approach was already defined, the industry's attention shifted almost entirely to tactics. Best practices, playbooks, templates, checklists. Patrick Gilbert describes what happened to budgets under this model. Instead of starting with a vision of where the business wants to go and proactively allocating resources toward those initiatives, budgets became reactive. They were backed into a number based on how much revenue could be acquired under a specific ROAS threshold. The result is that most digital-first brands operate at something closer to a 5/95 or 10/90 split, with nearly all budget going toward performance. Many CMOs do not even think of their budget in terms of brand versus performance. They think of it as the total amount they can spend while maintaining profitable ROAS targets. This creates a trap. Without brand equity behind your performance campaigns, your bottom-funnel dollars work harder for someone else. A new insulated coffee mug company bidding on the same keywords as YETI will always lose. YETI gets higher click-through rates, higher conversion rates, and higher margins because consumers recognize and trust the brand. Clever ad copy and discount codes will not close that gap.

Brand Builds Performance, Performance Builds Brand

Patrick Gilbert recounts a project for a global apparel brand that illustrates why the traditional division between brand and performance no longer holds. The brand had two separate teams, two separate Meta ad accounts, and two very different sets of goals. The brand team drove recall and favorability. The performance team drove sales at a profitable ROAS. When AdVenture Media built a marketing mix model using four years of Meta data, the findings challenged the assumptions that justified those silos. Brand campaigns were not just creating a halo effect around performance. They were driving direct sales. Even without product-driven ads, lifestyle and awareness campaigns captured meaningful revenue on their own. And the inverse was equally surprising. Performance campaigns were not just capturing sales. They were building brand equity, recall, and positive sentiment. The implication is clear: the neat division between upper funnel builds equity and lower funnel drives sales no longer holds. Both sides bleed into each other in ways that siloed structures cannot account for. When you invest in brand, your performance dollars go further. Click-through rates climb, conversion rates rise, and CPAs fall. When you run performance campaigns, you are also shaping long-term perceptions of your brand. The 60/40 split is not about choosing one over the other. It is about investing in both at the ratio that maximizes their combined effect.

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