B2B tech has an ongoing problem. Too much is spent on performance marketing and not enough on brand building. This imbalance drives up customer acquisition costs and diminishes results. Brand marketing earns trust, builds mental availability, and drives long-term growth.
Even with years of data showing that short-term tactics like demand generation aren’t delivering, B2B tech companies keep doubling down on them. They chase leads instead of building brand reputation. And they still spend more on R&D than on marketing.
The latest Deloitte Fall 2024 CMO Survey Report shows the trend isn’t slowing. This year, companies increased short-term performance marketing budgets by another 10%. And since 2022, R&D budgets for B2B products jumped 34%, while B2C R&D budgets for products fell by 12%.
What’s troubling is how little is being invested in brand reputation—29% less in 2024. Rising customer acquisition costs, diminishing returns, and leaky funnels aren’t a formula for sustainable growth. The more money we pour in, the more pours out. And when we keep skipping the part that makes marketing stick—building a reputable brand—how do we expect to scale?
“If you simply move half your budget to good brand awareness building, you will make more revenue in total.”
Mats Georgson, Ph.D.
Seth Godin backs this up in Chapter 19 of This Is Marketing. Trust isn’t static. It’s earned at every opportunity. And building trust is more important than just getting clicks.
Dale W. Harrison breaks it down further in a recent LinkedIn post. Great marketing does two things:
A strong brand sticks. It earns trust over time. It makes buying simple. But too often, we chase instant results instead of committing to lasting growth.
This is why B2B tech needs brand marketing—to fix leaky funnels, earn trust, and drive sustainable growth
Chapter 19 in This Is Marketing is all about The Funnel. It’s important to understand that funnels are internal process tools. Customers never see themselves in a funnel. They come and go as they please at any stage, any time, and as often or as little as they choose.
Between the top and bottom of every sales funnel, most people leak out. As Seth Godin explains, it’s because trust changes as customers move through the funnel—trust isn’t static.
At the top, we’re creating attention. In the middle, we’re building credibility. But as buyers get closer to purchase, trust starts to erode. Maybe their needs don’t align. Maybe your brand isn’t the right fit. Or maybe life just gets in the way. It gets worse when saying yes feels more stressful than walking away—and that’s often the case.
So, what’s causing the leaks?
Fixing leaky funnels with B2B brand strategies starts with the right customers and making it easier for them to trust you.
To be effective, sales and marketing funnels need the support of B2B brand marketing for trust, ensuring customers feel confident in their decisions. Together brand marketing and performance marketing create better funnels, bringing in the right people and making it easy for them to take the next step.
Here’s how to fix yours:
We can’t fix our funnel by patching every hole. We build it intentionally, creating a system that attracts the best-fit customers, earns their trust, and removes the barriers to saying yes. And short-term performance marketing alone can’t do that. We also need a reputable brand that gets remembered.
A strong funnel relies on B2B brand marketing for trust, ensuring customers feel confident in their decisions
Not all marketing is worth the spend. To know if our efforts are paying off, we need to understand our customer’s lifetime value (LTV).
LTV tells us how much a customer is worth over time. Without it, we’re flying blind—spending money on ads and hoping it works out. That’s no way to grow.
Seth Godin offers a great example: Imagine spending $1,000 to run ads that reach 1 million people. Out of those, 20 people click ($1,000 / 20 = $50 CPC), and 2 people buy ($1,000 / 2 = $500 cost per sale). If those customers’ LTV is higher than $500, great—keep buying ads. If it’s less, stop and fix your funnel.
The math might seem simple, but:
LTV isn’t a one-and-done deal. It needs regular updates as your business grows. The customers you attract today might have a very different LTV as your business scales.
The latest Deloitte Fall 2024 CMO Survey Report validates the findings from a 2013 study, The Long and the Short of It by Les Binet and Peter Field. Most companies spend too much on short-term performance marketing and not enough on building their brand.
This imbalance has been growing for years. Customer acquisition costs keep rising, while the returns from performance ads shrink.
Mats Georgson, Ph.D. recently posted some excellent insight about this on LinkedIn, “Skipping brand marketing is like skipping the factory in manufacturing. Without a factory, you can’t produce the product.”
And without brand marketing, performance marketing eventually stops delivering.
Companies that balance both brand and performance marketing drive more sustainable growth. Brand marketing builds mental availability—ensuring your company comes to mind when buyers are ready to purchase. Performance marketing builds physical availability—making it easy for buyers to act on that awareness.
Overspending on performance ads is like harvesting demand without planting the seeds to create it. The solution? Shift more of your budget into long-term brand building. You’re not just investing in awareness—you’re building trust, recall, and future customers.
Investing in long-term growth through B2B brand reputation is essential for sustainable growth. Performance marketing might bring quick wins, but it can’t sustain your funnel without trust, recall, and reputation.
Think about it: What if Apple had only run “Think Different” for one quarter? Would Nike still be iconic if “Just Do It” lasted only six months? Would SAP be synonymous with business success if “The Best-Run Businesses Run SAP” wasn’t a decade-long commitment? Probably not.
These campaigns worked because they were consistent, long-running, and focused on building trust. The same principle applies to your business. Short-term ads might drive clicks, but brand marketing builds the foundation that makes people choose you when it matters.
The question isn’t whether you can afford to invest in brand marketing. The question is: how can you afford not to?
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This article is AC-A and also published and discussed on LinkedIn. Join the conversation!
