‘Performance is just renting customers’: Analytic Partners’ Paul Sinkinson on why brands need to think long term

At a time when businesses are tempted by the allure of quick wins, Paul Sinkinson, Managing Director (Australia) of Analytic Partners, shares his insights on why brand marketing is crucial for long-term success, the pitfalls of overemphasising performance marketing, and the importance of being challenged in your career.

With decades of experience in the industry, Paul Sinkinson, Managing Director (Australia) of Analytic Partners, has seen pretty much everything. But if there’s one lesson he’s learned from his time working with Australia’s biggest businesses, it’s the undeniable power of brand marketing in driving sustainable growth.

“People think the reason brand works is because it's a bit airy fairy, or it gives people an emotional connection,” Sinkinson says. “I'm not saying it's not that, but there are real, measurable benefits from it that've got nothing to do with sitting around on a beanbag singing Kumbaya.”

For Sinkinson, the current marketing landscape is something of a double-edged sword. On one side, there’s the allure of performance marketing, with its promise of immediate, measurable results. But on the other, there’s the enduring value of brand building - a strategy that Sinkinson champions as being essential for long-term success.

“There's some really transactional, basic financial reasons for brand marketing,” he says.

“Brand messaging outperforms performance messaging 80% of the time. People might say, ‘No one can even define what a brand ad is,’ to which I say, if a price based ad has a price point, and a product based ad has a product feature that might be around for a few months till you improve it, brand is the leftover- the creative that you can keep airing for  a couple of years as it hasn’t stopped being a limited time offer.

“Imagine you’re a department store advertising for widget number one. You’ll drive a lot of sales for that, but it’s not going to do a lot for the rest of your widgets. That’s what brand does - it drives everything.”

Performance does have a place in the landscape. In times of economic stress, like we’re in right now, it’s inevitable that businesses may prefer to focus on the kind of short-term results performance marketing drives.

But Sinkinson believes the danger of focusing on performance too heavily is that it results in businesses “renting customers”.

He explains: “If you’re renting customers, it means someone else can rent them too. And it becomes a bit of a game of chicken of who’s got the biggest budget, and who’s prepared to run their business at the biggest loss. 

“If you stop offering the customer an incentive, what reason do they have to buy from you?” he asks. Sinkinson’s perspective is shaped not only by his extensive experience but also by the insights gleaned from Analytic Partners’ ROI Genome, a research tool built from two decades of marketing intelligence and hundreds of billions in spend.

Through Commerical Analytics, (an advance on Marketing Mix Modelling (MMM)), which is a core service of Analytic Partners, companies can see the bigger picture - such as how different marketing efforts, including brand and performance initiatives, as well as factors outside of Marketing contribute to overall success. It’s this intelligence, which is funnelled into the ROI Genome, which allows Analytic Partners to make evidence-based decisions around marketing investment.

One of the key things MMM can do, Sinkinson explains, is accounting for all the other factors that generate growth beyond marketing and advertising.
He says: “The grim truth is that marketing or advertising, on average, drives about 5-10% of your volume. There are attribution tools online that say 100% of your volume comes from advertising - can you imagine the growth Australian companies would have had over the last five years if that were true?

“Therefore, there's other things driving growth. It's not all marketing. You would have CFOs running around, rifling through the back of the sofa to find more money to put into advertising if that were true,” he adds.

Sinkinson has been Managing Director (Australia) of Analytic Partners for almost a decade. In that time, he’s grown the local office from just himself to a group of more than 25, all responsible for working with some of the biggest companies in Australia, such as ANZ, McDonalds and Arnott’s.

As for his leadership philosophy, it often boils down to one thing - investing in the leaders of the future, and being challenged. 

“Naturally, as you get more senior in a business, it's harder to focus on your own development,” Sinkinson says. “You have to support yourself with great people to challenge you internally and I'm blessed to have two directors under me who challenge me and make sure that I continue to grow.”

As the conversation shifts towards the future, Sinkinson remains optimistic. He sees the growing recognition of the value of brand marketing and the increased adoption of tools like MMM as positive signs for the industry. 

His advice to marketers? Don’t fall for the “shiny new thing”.

“Don’t walk away from the stuff that gives you good quality and national reach at speed,” he says. “The shiny new thing will always get the attention, but let’s not forget the old, tried and true methods that do the heavy lifting and base work that the shiny thing needs to be able to leverage off the back of.”