Direct-response costs are forcing marketers to change their game plan
The reality today is straightforward: traditional direct-response strategies are becoming financially unworkable. Performance marketers across the board are feeling the heat from surging ad costs on major platforms like Google and Meta.
When we look at Google’s cost-per-click (CPC), it’s jumping by 10% every year. And with Meta, we’re seeing an even steeper increase—lower-funnel cost-per-thousand impressions (CPM) is now over 100 times higher than the upper-funnel CPM.
Soaring costs bring direct-response campaigns to a tipping point, making it clear that doubling down on traditional methods is not sustainable if return on investment (ROI) and return on ad spend (ROAS) are the goals.
The practical takeaway? We need a shift in mindset, and it’s no longer just about squeezing every last drop out of the bottom of the funnel.
Instead, we need to reimagine our marketing mix in a way that lightens the load on direct-response spending while paving a path to both profitability and growth.
Google and Meta costs are skyrocketing
Google and Meta are central to many marketing strategies, but today, they’re testing every marketer’s budgetary limits. Google’s annual CPC rise of 10% is straining budgets, while Meta’s costs present an even sharper dilemma.
Meta’s lower-funnel CPM has become prohibitively high—over 100 times that of upper-funnel campaigns.
As a result, marketers are finding that even the best-optimized campaigns struggle to deliver a sustainable ROI. This isn’t only a pricing issue, it’s a strategic one. If we can’t scale down here while achieving a healthy ROAS, then direct-response alone simply won’t cut it.
Marketers need to weigh how much of their budget they can genuinely afford to commit to these high-stakes, lower-funnel channels.
Brand marketing is a powerful way to tame soaring ad costs
Brand marketing is now a strategic pivot for those who recognize that the rising cost of direct-response calls for a broader strategy. Brand marketing holds the potential to create new value beyond bottom-funnel efforts, engaging audiences while sidestepping the cost pressures in lower-funnel engagement.
This doesn’t happen automatically—brand marketing’s impact has historically been difficult to measure, which made some marketers hesitant to embrace it fully. But today, that’s changing, thanks to data-driven tools that give brand marketers the clarity they need to prove real impact.
Measurement tools that make brand marketing work
Brand marketing was once considered a soft metric exercise, more art than science. But with today’s tools, we’re not in the dark anymore.
Take Meta’s Robyn, for example—a media mix modeling (MMM) tool. It may require developer support to set up, but once running, it does a tremendous job quantifying how past spends have impacted revenue.
Visibility here shows the bottom-line effect of branding and recommends how to invest future budgets for the best results.
Performance branding measurement studies also show that it’s possible to increase reach by double digits and decrease cost per acquisition (CPA), proving that brand marketing can directly drive outcomes we care about.
Privacy-safe attribution is easier with third-party tools
For marketers who don’t want to depend solely on platform-specific tools, there are third-party solutions like Rockerbox and ChannelMix. These tools provide media mix modeling and multi-touch attribution without locking users into a single platform, which is particularly useful as we move away from third-party cookies.
While they do come with a price tag, they bring attribution options that keep user privacy intact while delivering the data-driven clarity needed to track performance across channels.
The balanced marketing strategy you need for today’s ad market
To succeed today, we need to rethink how we measure and spend, looking beyond small ROAS boosts and addressing bigger questions in the marketing mix.
Using full-funnel tools, we can focus on when and where to bring users into the purchase journey and how to introduce them to the brand in a way that builds long-term loyalty. In this way, marketers can stop focusing on narrow retargeting gains and instead bring larger, more strategic wins to the table.
Ask bigger questions to maximize marketing returns
The real opportunity lies in shifting from small improvements to big-picture thinking. Adopting full-funnel tools like MMM and multi-touch attribution lets marketers ask smarter questions—questions that lead to more profound insights.
For example, rather than simply trying to improve ROAS by squeezing retargeting, we can explore the best times and channels to draw people into the brand experience.
Broader perspective here makes it possible to shift focus from small retargeting adjustments to larger, more impactful strategies that move the needle on growth.
Rebalance your budget to boost efficiency and scale
A well-rounded, data-driven view often reveals a surprising insight: over-investment in paid search.
Many marketers find they’re putting too much budget into brand search and retargeting, which only reaches people already familiar with their brand.
Through rebalancing the budget to include upper-funnel channels, they gain both cost efficiency and the ability to reach a broader audience, fueling both scale and ROI in a way that’s simply not possible by doubling down on the same narrow set of tactics.
Take these steps to successfully shift towards brand marketing
For those ready to bring brand marketing into their strategy, the path forward involves a steady, data-backed approach. It’s about testing, learning, and gradually proving results.
Clean up and analyze historical data (ideally, at least two years’ worth) to feed MMM tools, giving you a foundation for more strategic budget shifts.
1. Begin with data-driven tests for a smart brand marketing shift
Don’t jump in too fast. The first step is to look at historical data—two years is a good benchmark for MMM insights—and then start integrating tools like Google’s Enhanced Conversions and Meta’s Conversions API.
This will let you trace the value of each user’s journey across your marketing funnel, which ultimately helps you make informed decisions about where brand marketing could have the most impact.
2. Reallocate budgets on costly campaigns without losing ROI
Test budget shifts in the high-cost areas of your funnel to see where brand marketing can take the load off. Begin by identifying a lower-funnel campaign with rising engagement costs.
Run a lift or geo holdout test, turning off the campaign temporarily to measure the revenue impact. It’ll help determine if your performance campaigns are actually incremental and give you hard data to support moving some of that budget into branding without risking ROI.
Make first impressions count
Branding is all about first impressions, and this means investing in creative assets that make an impact. Reaching new audiences is key here; we don’t want to keep hammering the same audience with the same message across channels.
To get long-term growth, creative branding should reach new eyes and spark interest with each interaction.
Your brand’s first impression is what wins customers
Your brand’s first impression could mean everything when attracting new customers. Focusing on metrics like reach and frequency, you’re making sure more eyes fall on your brand—you’re also expanding the range of potential customers learning about what you offer.
The result is that your brand’s message is fresh for new audiences, rather than overloading the same limited set of prospects.
Test branding for real gains in CPA and reach
Run a Meta performance branding test to see the effects on CPA and reach. Even if the initial results don’t transform your strategy, this step will provide valuable insights into how brand campaigns can enhance overall results. Over time, this investment builds a more sustainable marketing approach for the future.
Make 2025 the year you find balance
As you move into the 2025 planning cycle, put brand marketing front and center in your strategy. While holiday campaigns may call for performance-first spending, the new year brings a chance to set a more balanced plan in motion.
Through developing a full-funnel, blended strategy, you’re setting up for sustainable growth that won’t just ride on seasonal spikes but deliver year-round.
