Acquisition and marketing / Lesson A07

The 60/40 marketing rule: definition, context and limitations

The 60/40 marketing rule usually means about 60% brand building and 40% sales activation, a ratio drawn from Binet and Field's research. Not all marketing produces a sale today; some helps people remember and trust you later. The idea is balancing those jobs, not blindly putting 60% of every small-business budget into brand.

By the end, you should be able to

  • Tell the difference between brand building from sales activation
  • Connect spending to time horizon and business conditions
  • Set up a balanced test without blindly copying a ratio

Two jobs with different time horizons

Brand building helps people recognise, remember and consider a business over time. Sales activation aims to prompt a nearer-term response. The IPA's discussion of Binet and Field's work describes the familiar 60:40 brand-to-activation ratio and later research with a similar overall balance.

That does not establish that a new local service business should immediately put sixty cents of every dollar into broad advertising. Research context, market, category, buying cycle and available resources matter. The ratio is a useful challenge to short-term thinking, not a substitute for a business plan.

Label the job, not the channel

Social media is not automatically brand building. Search is not automatically activation. A practical explanation may build familiarity and generate an enquiry. A price-led social advertisement may seek an immediate purchase. Classify an activity by its intended effect and measurement window, not by the platform logo.

Use two questions: what should change soon, and what should become easier later? A promotional campaign may fill available appointments this month. A consistent series explaining your specialist expertise may help future buyers recognise you. Both require an offer worth buying and delivery that supports the promise.

Worked example (illustrative): a small consultancy

A consultancy has a $2,000 monthly marketing budget and limited founder time. It spends everything on immediate enquiry generation. Each month starts again from zero, but the owner cannot tell whether people remember the business or understand its specialism.

The owner does not mechanically move $1,200 into a brand campaign. First, they define one customer problem, improve the service page and create two reusable explanations. They retain a limited acquisition test and track suitable enquiries. They separately review direct enquiries, customer recognition in conversations and use of the explanations over a longer period.

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