Research drags down Don Elgie’s Creston – the same thorny issue facing big brother WPP

Have the world’s advertisers decided they know everything? Or are the likes of Google providing them with so much data that they don’t need other research companies any more?

We’ve remarked before on the way research -or ‘insight’ as it likes to call it – has been a drag on WPP ever since it bought Anglo-French researcher TNS/Sofres for £1.1bn in 2008.

Now Don Elgie’s mini-marcoms company Creston has announced a startling fall in research income, down £2m to £5.5m in the six months to the end of September. Creston’s research companies include ICM and Marketing Science.

CEO Elgie (left) says things are looking up in the research division after a round of cost-cutting but there seems to a bigger trend here. While ad spending and most other forms of marketing have held up remarkably well in the four years since the financial crash, research is taking a powder.

Aside from the Google factor another (linked) reason may be the remorseless rise of digital, well on the way to a 25 per cent share of global ad expenditure and already there in countries like the UK. Digital communications come with built-in research in terms of impact and effect so an increasingly large sector of marketing doesn’t need so much third party information.

Aside from this, Creston reported flat revenues but doubled pre-tax profits largely due to a tax rebate from the UK tax authorities. It also added to its medical business with the purchase of 75 per cent of a small healthcare-focussed digital agency DJM Digital Solutions.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.