Stop Paying for Customers You Already Own: The True Cost of Brand Cannibalisation
Your agency sends the monthly report. Brand campaigns are crushing it. 10.0 ROAS. 12.0 ROAS. Sometimes 15.0 ROAS. They recommend increasing brand budget because "it's our most efficient channel." This recommendation should make you angry.
When a customer searches "JudeLuxe Hoodies", they are not researching options. They are not comparing alternatives. They have already decided to buy from you. They are looking for your website. If you pay Google £1.50 for that click, you are paying a tax on your own brand equity.
The high ROAS is not a sign of campaign efficiency. It is a sign that you are claiming credit for sales that would have happened anyway.
The Anatomy of Brand Traffic
Not all brand searches are equal. Understanding the composition of your brand traffic is essential before making any decisions:
Navigational Brand Searches
"JudeLuxe", "JudeLuxe.com", "JudeLuxe login"
These users know exactly where they want to go. Paying for this traffic is almost pure waste unless competitors are actively conquesting your terms.
Brand + Product Searches
"JudeLuxe hoodies", "JudeLuxe sale", "JudeLuxe new arrivals"
Higher intent but still your existing customers or people who have already decided to check you out. Still largely cannibalised traffic.
The ROAS Inflation Game
Agencies love brand campaigns because they inflate blended ROAS. If your generic campaigns run at 2.5 ROAS and your brand campaigns run at 10.0 ROAS, blending them together produces a comfortable 4.0 ROAS. This masks the inefficiency of your true prospecting spend and makes reporting look better than reality.
How to Measure Incremental Lift
The only way to know if your brand spend is valuable is to test it. Words like "defensive" and "protecting our brand" are not evidence. They are assumptions.
1. Geographic Holdout Test
Turn off brand ads in one region (e.g., the Midlands) for 2-4 weeks while keeping them running everywhere else. Compare total revenue (paid + organic) in the test region versus control regions.
2. Time-Based Test
If geographic segmentation is not possible, turn off brand ads entirely for 2 weeks. Track whether total brand-related conversions (paid + organic) change. Account for seasonality by comparing to the same period last year.
3. Competitor Auction Analysis
Check Auction Insights for your brand terms. If no competitors are bidding on your brand, there is nobody to "defend" against. If competitors are present, measure their impression share to understand the real threat level.
What Holdout Tests Usually Reveal
£3,000 ad spend
£0 ad spend
£60 cost per incremental conversion
The reported 10.0 ROAS becomes 0.5 ROAS when you measure incrementality. Most of those conversions would have happened anyway.
When Brand Campaigns Are Actually Valuable
Brand campaigns are not always waste. There are legitimate reasons to run them:
- Active competitor conquesting. If competitors are bidding on your brand terms and capturing 20%+ of impressions, defending makes sense.
- Weak organic rankings. If your site does not rank #1 for your own brand name (common for new brands or those with generic names), ads fill the gap.
- Product launches. When launching new products, controlling the message and landing page in search results can accelerate awareness.
- Negative press management. If there is negative content ranking for your brand terms, ads can push it below the fold.
But notice: these are specific situations with specific triggers. The default should be scepticism, not assumption. "We've always run brand campaigns" is not a strategy.
The Real Cost to Your Account
Beyond the direct cost of paying for traffic you already own, brand cannibalisation has secondary effects:
Distorted Reporting
Blended ROAS masks the true performance of your prospecting campaigns. You cannot make good decisions with inflated averages.
Misallocated Budget
Every pound spent on brand is a pound not spent on new customer acquisition. The opportunity cost is real.
Algorithm Training
Smart Bidding learns from your conversion data. If half your conversions are cannibalised brand traffic, the algorithm optimises for the wrong patterns.
The goal is not to eliminate brand spend. The goal is to know what you are buying. If brand campaigns genuinely protect revenue from competitors, that is valuable. If they are just inflating your ROAS reports while cannibalising organic traffic, that is expensive vanity.
The Audit Question
Ask your agency this: "What is the incremental lift from our brand campaigns? How do you measure it?"
If the answer is "we cannot measure that" or "brand campaigns are defensive by nature", you are being sold assumptions, not evidence. If the answer is "we ran a holdout test and here are the results", you have a partner who thinks about your money.
Know What Your Brand Spend Is Actually Buying
We will design and run an incrementality test to show you exactly how much of your brand budget is real value versus cannibalised traffic.
Get an Incrementality Analysis