Marketing communications executive Roger Hyslop says the recent Advertising Association figures about the contribution of advertising and related disciplines to the UK economy show that it can contribute significantly to the growth the UK badly needs.
Our industry recently received an unexpected bouquet in the shape of the three year study by the Advertising Association and Deloitte into the effect of advertising on the UK economy. It has calculated that for every £1 spent on advertising, £6 is generated for the wider economy. Annual ad spend stood at £16bn in 2011, so by that estimation advertising added at least £100bn to the UK’s gross domestic product, according to the study report, Advertising Pays.
I am assuming that their definition of ‘advertising’ now encompasses what we all know as marketing communications. The wider term is now used to describe all forms of branding, of which paid-for media advertising is one important part. All the major advertising agencies are now claiming expertise in every channel, every discipline and every communication and motivational technique, a claim that most clients regularly put to the test.
For as long as I can remember, advertising has been viewed by the general public at best with distrust and at worst, on a par with estate agents and secondhand car salesmen! So this news came as something of a revelation. Admittedly the Advertising Association can fairly be described as having a vested interest, and financial services organisations have slipped down the image list to join the estate agents in terms of public perception. But the Advertising Pays report makes for good reading.
As the AA’s chief executive Tim Lefroy says about the size of the advertising market: “That’s bigger than spending money on building new roads, railways or stations where the conversion factor would be one to four. Spending money on advertising will grow the economy, increase jobs and make things better in this country.”
Our recent online campaign for the new Peugeot 208 featuring Nonstop, Let Your Body Drive, generated over eight million views of a highly innovative viral video, 20,000 Facebook interactions and requests for test drives were significantly higher than target. Whilst conversion rates of test drives to sales is also a closely guarded secret, it is a reasonable assumption that several hundred cars were sold as a result, with the consequent positive effects on the local economy. As the client noted, “the campaign contributed to what was the most successful prelaunch for Peugeot ever.”
On a national scale, the success of Sainsbury’s’ ‘Try Something New Today’ proposition has been well documented as having contributed to its current highest-ever share of the retail grocery industry, to the benefit of customers, colleagues and shareholders. The campaign encouraged customers to spend a little extra every time they shopped. The campaign achieved a sales-led recovery and delivered £2.5 billion extra revenue.
Culture secretary Maria Miller (a former advertising executive) apparently said recently that advertising is on a par with manufacturing, in that both will drive economic recovery in the coming years. If she’s right, it only confirms what we’ve known all along, that whilst advertising can be criticised for sometimes creating unnecessary consumption of some products, it is fundamentally the engine of the UK economy and as such, is to be celebrated as one profession which may hasten our recovery from this debilitating recession.
Roger Hyslop is a non-executive Director of INITIALS Marketing