Is this the year DTC brands get serious about brand?

Imagine you own an apple orchard. Each season you harvest every fruit, celebrate the returns, and bank the money. Then you forget to plant new trees. The yields shrink. The costs climb. The orchard that paid for itself starts asking you for money. That is precisely what happens to a brand that over-indexes on performance marketing and neglects the building.

DTC brands face a particular version of this. The performance side they get in spades. Judging by certain quarters of the internet, there is no shortage of people and agencies gunning to get you 12x on your performance ads. Some of them are very good and know their onions. The rest are digital noise.

What many marketers have always known intuitively, a WARC study has now put numbers to. The relationship between brand and performance marketing is not additive. It is multiplicative. It is no surprise the age-old debate is back in the limelight, because the very idea of brand building in an atomised world of algorithms and attention was being argued over again only weeks ago.

The performance penalty

The WARC study reveals a startling figure. Overinvesting in performance advertising can reduce revenue returns by a median of 40%. The report calls it the doom loop, a trap of wasted spend and diminishing returns. You keep harvesting and the orchard keeps giving you less.

The flip side is the more interesting number. When brands move from a performance-only approach to a more balanced advertising portfolio, they can achieve revenue growth of up to 90%. That is not an incremental improvement. It is a different growth trajectory.

The multiplication happens because the two halves do different jobs that compound each other. Brand-led activity engages a broad pool of future customers, builds emotional connection through storytelling, creates mental availability, establishes trust and softens price sensitivity. Performance marketing captures the in-market buyers, delivers the rational nudge, optimises the conversion path and feeds back the data. One builds the demand. The other catches it. Run them in isolation and you are harvesting an orchard nobody planted.

The not-so-new growth formula

The key is to stop treating brand and performance as separate streams competing for the same budget. When strong brand-led creative meets targeted performance marketing, WARC calls the result a double impact, lifting sales across both the long and the short term. A few things follow from that.

Build integrated brand platforms rather than parallel content factories, so your brand story informs your performance messaging and the customer gets one coherent experience instead of two disconnected ones. You will probably gain creative consistency in the bargain. Treat brand building as a fundamental part of the growth engine, not a luxury line item, and remember that all marketing should perform. Do not separate your terminology or your spending into a worthy half and a working half.

Measure both ends. Combine the traditional KPIs like ROAS with brand metrics such as awareness, consideration and emotional connection, so you can see the long-term health as well as the short-term hit. And invest in creative that serves both objectives at once, because strong brand-led work has repeatedly been shown to make performance marketing more effective. That is the virtuous cycle. If you are unsure whether your creative is doing that job, do the creative development research up front rather than relying on testing and post-mortem analysis after the money is spent.

The path forward

For DTC brands, the shift is mostly one of mindset. Stop viewing brand and performance as competing interests. See them as complementary forces that, properly aligned, produce exponential growth rather than linear. Audit the current mix. Find the brand-building opportunities. Build the integrated platforms. Set up measurement that captures both the immediate and the lasting. Get internal alignment around the multiplier before you spend.

Some of the bigger DTC players are already moving, with brand hires and genuinely best-in-class activations. AG1 and Dr Squatch spring to mind. I expect brand building to take a different tactical shape this year too, reaching beyond the social feed into multi-hyphenated entertainment that audiences can participate in, touch and feel.

The WARC study does not just hand over data. It offers a roadmap for marketing effectiveness, which is useful, because that is its objective. For DTC brands ready to move past performance-only marketing, the opportunity is clear. Invest in the brand, keep the performance efficient, and let the multiplier do the work.

The orchard does not just need harvesting. It needs cultivation, care and continuous renewal. Only then does it deliver the kind of sustainable yield that justifies the land.

The Brand Multiplier (n.): The principle that brand and performance marketing combine multiplicatively, not additively. Run together, they produce exponential growth (up to 90% revenue uplift in the WARC evidence). Run in isolation, performance over-investment triggers a doom loop and a median 40% revenue penalty.

Asked at the counter

What is the performance penalty? It is the cost of over-indexing on performance marketing while neglecting brand building. The WARC study found it can reduce revenue returns by a median of 40%, because brands fall into a doom loop of wasted spend and diminishing returns. You keep harvesting an orchard nobody is planting, so the yields shrink and the costs climb.

How much should DTC brands spend on brand vs performance? There is no single magic split, but the evidence is clear that performance-only is the expensive option. Moving from a performance-focused approach to a balanced portfolio can deliver revenue growth of up to 90%. Treat brand building as a fundamental part of the growth engine rather than a luxury, and remember all marketing should perform.

What is the multiplier effect in marketing? It is the finding that brand and performance marketing multiply rather than add. Brand-led activity builds demand, mental availability and trust. Performance catches the in-market buyers and converts them. Run together, strong brand creative makes performance more effective, creating a virtuous cycle WARC calls a double impact across both long and short-term sales.