Don’t confuse brand building for a measure of ROI

In some respects, marketing has changed dramatically since I last wrote for Marketing Week in 2021. Artificial intelligence has taken over the world, marketing departments included. The actual numbers have proven somewhat exaggerated – who knew that people with astronomical financial incentives would be inclined to make claims up? – but for now until the bubble bursts, we live in a world of ChatGPT, Perplexity, Claude, DeepSeek and shallow reasoning.

Broadly speaking, though, the marketing conversation has remained so consistently repetitive that one might be better off setting one’s watch than one’s budget to it. The glaring weaknesses in the effectiveness discourse remain largely ignored, the battle between the Ehrenberg-Bass conformists and dissidents is as yet ongoing, and most people who call themselves strategists still have a labrador’s understanding of what the term ‘strategy’ actually means. Plus ça change, plus c’est la même chose.

Though I will continue my quixotic quest to provoke change, I do not earnestly hold any hope of making a difference; even my most widely shared articles and white papers of old have had precious little impact on the macro. For instance, four years ago I wrote a piece on what I called the “effectiveness of language”. My point was that many marketers use terms without knowing what they mean or caring to define them, leading to a situation whereby they manage to keep up verbal appearances but fail to actually understand the language that they use – and waste resources as a result.

The article has been referenced all over the world since, in magazines and on conference stages. The net effect? By all accounts, three fifths of bugger all. Marketers still use language with the kind of perfunctory precision normally reserved for politicians and management consultants.

Brand building is an activity, not a measure

A particularly good illustration of the unfortunate modus operandi came a week or so ago. One of the big marketing research outlets released a report (I use the term very loosely) on ROI measurement. How, the firm asked, do marketers across the globe measure it?

The answer came back: “Marketers recognise brand building as a key measure of ROI.”

To quote the French, le WTF? The sentence makes no sense. Brand building is not just a “key measure”, but one of ROI? What in the name of Jesus Kenneth Christ does that even mean?

Introducing brand building into the ROI equation is on par with inserting a mood into a fraction. It makes zero sense.

A bit of digging by yours truly and occasional partner in retail crime, James Hankins, unearthed that nobody involved had bothered to actually define the terms, though a very nice lady from the research outfit in question let us know that “no ratios were involved”. No ratios were involved in measuring ROI? No, she insisted.

For those who have misplaced their introductory textbooks, ROI stands for return on investment. It is the percentage return on a marketing activity; all the returns from the activity minus the costs (the investment), divided by the costs. It is by definition a ratio, a measure of efficiency. Indeed, it is the marketing ratio of all marketing ratios.

Introducing brand building into the ROI equation is on par with inserting a mood into a fraction. It makes zero sense – literally, not metaphorically, none.

Even if we generously stretch ROI to mean some sort of generic result, an indicator of whether the marketing has somehow ‘worked’, the problem is but shifted one step up the sentence. What, then, is brand building and how would one measure that? Perception? That is primarily tied to penetration. Awareness? Not a great metric; certainly a very bad one for anyone looking to deduce what kind of bang they got out of their budget buck. Price elasticity? A better choice, but still not great for anyone looking to understand a return.

Category errors

The closer one looks, the odder the report’s conclusion is revealed to be. But it also highlights what one might call a larger linguistic issue: marketing has adopted the economists’ tendency to turn verbs into nouns.

I suspect it is a result of the paradox of the modern marketing department: it needs metrics and measures to rely on, but cannot rely on metrics and measures. All of its most important ones (eg market share, penetration, purchase frequency, share of category requirements, etc) are emergent results of a myriad of actions and interactions across time and space. They are summaries of what already has happened.

This emergence complicates the marketing department’s effort to stand on equal footing with the rest of the organisation. And so, they try to turn verbs such as brand building into nouns such as measures.

Yet, in order for ROI to be of practical value, it must be more or less immediate; it is a momentary rate under local conditions. For brand building to be of value, it must be allowed to take its time; it is the system’s memory of repeated coherence. Attempting to turn the latter into the former therefore not only makes no sense – it constitutes a category error.

Marketing has adopted the economists’ tendency to turn verbs into nouns.

Category errors, for those unfamiliar with the term, are mistakes in which things that belong to one category are taken to belong to a different category. The most famous illustration is that of a person being told that a sport involves team spirit. After being given a breakdown of each player’s role, the person asks which player performs the team spirit. Madness ensues.

Making matters worse still, the error soon also becomes structural. When organisations mistake a practice for a reading, they do not just mislabel; they misgovern. Work that should be judged by its contribution to memory and market structure is recast as a succession of period-bounded ‘proofs’. Budgets, targets and careers are then defended with evidence that cannot, by type, answer the question being asked.

Don’t mistake the work for the results

In time, the ill use of language shrinks the ambition: strategy gives way to accounting, capability withers, and the scandal is not that marketers measured poorly, but that they stopped noticing the work that they no longer do.

To be clear, this is not pedantry; it is the minimum hygiene of thinking in a field that insists on being taken seriously. Let ratios report what a period delivered and let brand building continue as the work that makes future periods easier. Do the work in verbs, read the results in nouns, and stop pretending that the two are interchangeable. One path tidies the report; the other alters the reality being reported.

The fix to marketing’s accountability woes is not to rebadge brand building as ROI or to mint a proxy that flatters the spreadsheet; it merely repeats the confusion under a tidier label, smuggling a practice into a ratio’s slot. Eventually, inevitably, marketing will get caught, and the results will not be pretty.

Markets audit in reality, not PowerPoint slides or research reports. When buyers stop purchasing, there is no argument left to make. The grammar will enforce itself: call things by their names or be corrected by them. Govern verbs as verbs, and nouns as nouns.

If you will not, the market will. Without ceremony, and without you.

JP Castlin is a former M&A lawyer turned strategist, who writes across the breadth of marketing with a focus on how the function fits and creates value within the wider organisation. His work spans published theory and high-level consulting in strategy, uncertainty, marketing, decision-making and economics. He is also an author and popular keynote speaker.