---
title: "The Golden Ratio of Advertising Budgets: 7:3, How Far Are You From It?"
description: "As is well known, the subtle and beautiful golden ratio is 0.618, existing in every corner of the world. In brand advertising budget allocation, the golden ratio is approximately 0.7—70% brand advertising plus 30% traffic advertising. But interestingly, when leaving the three-dimensional world and entering the two-dimensional universe, the golden ratio tends to exaggerate—eyes are bigger, legs are longer, and Da Vinci's human figure no longer conforms to 'trends.' The same applies to advertising budgets: in the two-dimensional world, people are dazzled by traffic, and there are waves of new consumer products riding the tide of traffic, as well as trend-chasing consumers searching for lower discounts on various platforms."
author: "New Distribution"
publisher: "New Distribution"
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published: "2022-08-06"
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# The Golden Ratio of Advertising Budgets: 7:3, How Far Are You From It?

> As is well known, the subtle and beautiful golden ratio is 0.618, existing in every corner of the world. In brand advertising budget allocation, the golden ratio is approximately 0.7—70% brand advertising plus 30% traffic advertising. But interestingly, when leaving the three-dimensional world and entering the two-dimensional universe, the golden ratio tends to exaggerate—eyes are bigger, legs are longer, and Da Vinci's human figure no longer conforms to 'trends.' The same applies to advertising budgets: in the two-dimensional world, people are dazzled by traffic, and there are waves of new consumer products riding the tide of traffic, as well as trend-chasing consumers searching for lower discounts on various platforms.

As is well known, the subtle and beautiful golden ratio is 0.618, existing in every corner of the world. In brand advertising budget allocation, the golden ratio is approximately 0.7—70% brand advertising plus 30% traffic advertising.
But interestingly, when leaving the three-dimensional world and entering the two-dimensional universe, the golden ratio tends to exaggerate—eyes are bigger, legs are longer, and Da Vinci's human figure no longer conforms to 'trends.'
The same applies to advertising budgets: in the two-dimensional world, people are dazzled by traffic, and there are waves of new consumer products riding the tide of traffic, as well as trend-chasing consumers searching for lower discounts on various platforms.
We give a thumbs up to those savvy and shrewd bosses who have seized the wave of the times; this is crucial. The so-called 'dividend' is being easily pushed to the high point of the wave with the help of the era's gravity.
But looking back, those products that did not fall from the high point or even disappear did not rely on periodic 'trend' gravity to stay suspended in the air; they stood on a solid platform of strength, which is gaining social recognition for the product and brand, and having a large base of loyal consumers.
Those who blindly chase trends and traffic are like the long legs and big eyes in the two-dimensional world that deviate from realistic proportions. They look beautiful in the two-dimensional world but cannot enter reality.
**01** **Internet-famous brands are just in the initial stage** **The brand-to-traffic ratio should be 1:9**
Zhao Yuanyuan, former head of Taobao Live operations, once said: 'More than 90% of the current 'internet-famous brands' on the market will disappear within five years, some even sooner.'
When capital hype, pseudo-demand controversies, and traffic pathologies entangle batches of entrepreneurs like thorns; rising bidding traffic costs and falling sales prices act like scissors, choking entrepreneurs; and those fleeting user data that come with traffic and leave with traffic will eventually extinguish the once-burning entrepreneurial passion.
Business warfare is so cruel. Many brands are very sensitive to being described as 'internet-famous brands,' but in the internet-born environment, what new brand can escape this stage? Just as infants should drink more milk, **when innovative products successfully stand out and become internet-famous brands, focusing on traffic advertising is essential.**
Take new consumer internet-famous brands as an example: with revenue around 100-200 million yuan in the initial internet-famous stage, marketing budgets should focus resources on traffic, with a brand-to-traffic ratio of 1:9. The urgent problem at this stage is to build a good reputation for the product, form the first small group of loyal users, and continuously refine and improve the product by listening to user feedback. Create topics, create content, and trigger attention and discussion.
After accumulating some firewood, light the fire first and ignite a small bonfire. Then use a small portion of the budget to focus on one point for brand advertising around traffic topics, so as not to let the small bonfire go out.
**02** **Emerging brands are in the growth stage** **The brand-to-traffic ratio should be 3:7 to 5:5**
After surviving the trials of survival of the fittest, relying solely on milk and complementary food cannot support the healthy growth of a company. **To break out of the first circle from being an internet-famous brand, it is necessary to go through the first withdrawal and transformation like a baby weaning. Companies must start building brand momentum and increase the proportion and resource intensity of brand advertising.**
Once revenue exceeds 100 million, ROI seems to become elusive, and companies clearly feel growth bottlenecks. That's because the cheap traffic in the early stage is used up, and internet information is massive; the initial traffic dividend can only capture a fraction of users. If you immerse yourself in the 'pregnant effect' and feel that everyone is desperately doing traffic, thinking the problem lies in needing to change the way you calculate traffic, this blind spot in market judgment will be fatal.
From breaking out of the 100-200 million circle to becoming an emerging brand with revenue of 2-3 billion, at this time the company should have completed product polishing, cultivation of the first batch of loyal users through social seeding, and management of online reputation, and have established a foothold in the segmented market of the category.
At this time, you should choose a target user group, which can be physical, such as specific cities; or target a specific user group, such as high-spending consumers or fitness enthusiasts, and conduct brand advertising within this area to expand social awareness of the brand and let more 'semi-precise' people know your brand.
At this time, you should increase communication methods on the internet, create topics, create content, and create traffic that can be spread. Don't miss any hot topics, integrate product value in appropriate ways. Although viral content is rare, maybe one of them will succeed.
The best choice for brand advertising is elevator advertising represented by Focus Media. Elevator advertising can be selected based on physical space, and it is 'mission must be accomplished' because people must pass through elevators every day and must see the ads, and repeated daily viewing naturally deepens the ad impression. At the same time, elevator advertising can choose the cities and specific locations within cities, which is also a very important advantage and can control the budget well.
The author often sees brand ads in Focus Media frames with Tmall or JD.com flagship store logos. Obviously, this is a cooperation with Tmall and JD.com, which can increase online traffic investment and also divert traffic to the brand's online flagship store through offline brand ads.
When they then open social platforms or see Tmall, JD, or Douyin pushes, and see your brand again, they will likely click to learn more. The reputation and positive reviews accumulated in the early stage will leave a good impression.
At the same time, as the marginal effect of traffic advertising diminishes, shifting budget to increase brand advertising can effectively boost consumer click-through and conversion rates.
Daily Dark Chocolate, which rose rapidly last year, used Focus Media elevator advertising to complete a classic breakout. As a typical new consumer brand, Daily Dark Chocolate entered the precise track of dark chocolate. To increase its share in the dark chocolate market, Daily Dark Chocolate launched its new 'Oat Milk Dark Chocolate' product on Tmall's Little Black Box in September last year, and subsequently launched its first brand advertising campaign through Focus Media, hoping to achieve a breakout.
The intensive placement covered the entire Double 11 communication cycle from September to November, and from data feedback, the first brand advertising campaign of Daily Dark Chocolate achieved significant results. **During the placement period, its free traffic share and active search volume rose rapidly, surpassing the benchmark international brand, and ultimately topped the Tmall Double 11 dark chocolate category sales championship, with total online sales across all channels increasing 350% year-on-year.**
The significant improvement in both brand awareness and product conversion rate illustrates Daily Dark Chocolate's breakout. With the help of Focus Media elevator advertising, Daily Dark Chocolate successfully entered the minds of hundreds of millions of mainstream Chinese consumers and secured the positioning of 'a new generation of healthy chocolate.'
Such cases are common in the past few years. i-baby, also an emerging brand with similar demands, experienced a similar breakout path to Daily Dark Chocolate. As a rising star in the ultra-niche track of baby sleeping bags, i-baby had never done brand advertising before 2020. How to overtake and break through? i-baby chose to launch brand advertising through Focus Media elevator media.
**Since the placement began in July 2020, i-baby's various data have been rising. By the end of that year, its brand search volume had overtaken the largest competitor by 140,000, and Tmall's 'brand search index' surged over 240% within six months.** The establishment of brand momentum also led to a rapid increase in conversion efficiency. After placing ads on Focus Media, i-baby repeatedly set new records in various live-streaming battles.
On the first day of Tmall Double 11 that year, i-baby successfully topped the sleeping bag category, **with single-day sales exceeding 100,000 units, a year-on-year increase of 500%; sales during the entire Double 11 period exceeded 200,000 units. Moreover, from August to November, in just four months after brand advertising, i-baby's total sales exceeded 400,000 units, with sales exceeding 100 million yuan, achieving a leap in brand scale.**
**03** **Mature brands are in the stage of competing for the throne** **The brand-to-traffic advertising ratio should be 7:3**
When corporate revenue reaches several billion, they have basically established a foothold in the category market. At this time, companies will likely face a second growth bottleneck—in this category, it seems that everything that can be done has been 'done thoroughly,' and it seems that all target users that can be reached have been reached.
Many companies choose to settle down at this time, trying to maintain the status quo. But in the business world, who can truly be stable? **Big brands are always constraining, new brands are eyeing covetously, and if you don't advance, you retreat. If you only splash in a lake, you will never know the capacity of the sea.**
Mr. Philip Kotler said that to form social consensus, you must move five types of people: **buyers, decision-makers, influencers, experiencers, and disseminators.** It is far from enough to reach only 'buyers' through traffic. Brand momentum is a social field energy. It is thinking of Nongfu Spring when drinking water, Haitian when using soy sauce, and Tesla when thinking of electric vehicles. It is a well-known fact, a conditioned reflex.
Traffic is precise distribution. When traffic advertising exceeds 50% of investment, companies mainly acquire customers and create sales through precise distribution of 'goods finding people,' so traffic cannot build a brand, but it can improve transaction efficiency; later, it is necessary to form 'people finding goods,' that is, consumers' 'designated purchase.' **Only when consumers actively search for brand keywords is the brand built, establishing group identity among mainstream people.**
When brand advertising and traffic advertising reach 5:5, in my opinion, it is a watershed. At this time, traffic advertising investment is basically at its ceiling, and continuing to invest in traffic advertising brings growth close to useless, becoming just a habit. But if you can increase brand advertising at this time, in addition to enhancing brand momentum and increasing consumers' active search ratio, it will also improve the conversion rate and average order value of traffic advertising, and even reduce traffic costs.
At this stage, you should maintain previous traffic advertising and content creation, while further strengthening brand advertising. Once brand advertising can be ignited, it will be like oil poured on a bonfire, and with the wind of good reputation, the fire will spread across the mountains.
At this time, the best way for brand advertising is to invest in centralized media—that is, platforms with the ability to ignite social groups, core media that can cover mainstream consumer groups nationwide, and can comprehensively cover the five types of people mentioned by Mr. Kotler, such as CCTV, Focus Media elevator media, Hunan Satellite TV, etc. Unless you can be like Musk and launch a satellite into space, which is also an extreme way to build centralized brand momentum, otherwise, we cannot escape the conventional media routines.
Let's look at Bosideng's 'textbook-style' brand return. In 2018, Bosideng, which had diversified but with little effect, returned to its main business of down jackets, and with a new positioning, comprehensively strengthened brand building aimed at urban mainstream people.
After consolidating a series of strategic alignments such as product strength and sales channels, Bosideng quickly ignited the market through high-frequency and strong brand communication on two centralized media platforms, CCTV and Focus Media elevator media, returning to the mainstream vision, successfully conveying the brand value and craftsmanship of Bosideng down jackets to urban mainstream people with trend-setting significance, and once again securing the 'down jacket expert' king brand position.
Speaking of the experience of brand rising against the trend, Gao Dekang, chairman and president of Bosideng, once said that making products is about the present, making brands is about the future, and the power of the brand is the key to breaking through involution.
It should be emphasized that brand advertising should avoid scattered placement. If the budget allows, it is recommended to choose a centralized ignition method, output brand information with high intensity. Physical spaces are elevators and subways, and online spaces are CCTV and popular variety shows. Consumers must be forced to see brand ads, and in the same period, repeatedly imprint brand impressions on consumers to create the social field energy of the brand.
A report by Kantar, a globally influential market research company, points out that **70% of FMCG revenue comes from the brand, from consumers' designated purchase; 30% comes from promotions and traffic.**
**When brand advertising and traffic advertising can reach 7:3, it is the true maturity of the corporate brand and the ultimate golden ratio for advertising investment.**


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