Lessons from the launch of our first annual Exports Report

On the morning of Tuesday 19th March, the Advertising Association launched our first ever Annual Exports Report at Ad Week Europe. The launch took place in a standing room only Ronnie Scott’s Jazz Club, as industry practitioners packed in to hear from Ad Week founder Matt Matt Scheckner, Credos director Karen Fraser, Promote UK chair Janet Hull and other speakers about the key facts and figures of the report.

AdWeek founder Matt Matt Scheckner opened the discussion by noting that the exports results revealed in the report are a testament to the UK’s enduring success globally:

“Without question the creative industries… [are] a vital part of the pathway going forward for this country’s economy, no matter what the rules of the road are.

 

“You have historic tremendous performance, you have present day tremendous performance manifested by what you’re going to see now, and without question going forward creative industry will continue to be an absolute vital cog in the UK economic wheel, within the region and globally.”

He was followed by our newly named Exports Champion James Murphy, who expanded on the uncertainty around Britain’s future on the world stage, putting the timescale of the ongoing transition into perspective:

“We are in the middle of the industry’s first ever Export Month, which is under the Promote UK organisation which is run by the Ad Association in partnership with the IPA, with tremendous support from the Department of International Trade. We’ve had the first ever UK advertising day at SXSW, at which we took over the British Music Embassy… and we’ve had the APA’s Tokyo-London forum. You can see it’s important not just to us, it’s important to the people who shape our macro economy and the policies in that economy as well.

 

“Right at the centre of this is a report being published today. As Matt hinted at there are some surprising findings. It may be that in the course of the discussion today we conclude that Brexit, no matter how chaotic it may feel at the moment, will be at least a game of two halves. It may be much bigger, more profound changes that play out over 10, 15, 20 years, particularly regarding exports.”

The report itself, compiled by the industry’s think tank Credos, provides some welcome optimism about the UK advertising industry’s success despite wider worries around Brexit. Among other stats, it finds that international trade in UK advertising services reached £6.9 billion in 2017. This is an 18% increase on the figure of £5.8bn registered in 2016, outstripping overall UK service exports which grew by 7% in comparison.

The UK’s balance of payments surplus for advertising was the biggest in Europe – £3.8 billion, while the export of advertising services has nearly tripled in less than a decade, up from £2.4 billion in 2009.

The data also demonstrates the continuing importance of EU markets ahead of Brexit, with the £3.2bn in 2016 exported to EU nations representing 55% of advertising exports. The percentage of all UK advertising exports going to Europe, including both EU and non-EU countries, was 59%.

Credos director Karen Fraser believes the reason for that exports success is less to do with a weakening of world currencies than it is to the UK’s strong creative heritage:

“The rate of growth accelerated after the Brexit vote, so it’s actually increased further and faster than it did before. I think there was a lot of momentum, but we’re also an incredible creative hub

 

“The UK wins more Cannes Lions than any country in Europe, 1500 awards since 2005, and per capita we win more creative awards than anywhere in the world. Clients, money, talent and expertise are attracted to London and the UK.”

Reasons for optimism

Following the presentation of the report, an expert panel discussed the reasons why the UK has such opportunity to expand on the world stage. Janet Hull, chair of Promote UK, began by outlining the work being done by the industry around Export Month:

“In the last month we have tackled the three biggest advertising markets in the globe. We’re number four. Going out to Austin is really about asserting the advertising credentials of the UK relative to the other European countries with whom we actively compete, and making them understand that we’re at the forefront of advertising knowledge.”

She cited the expertise in neuroscience demonstrated by UK delegates at SXSW as indicative of the reasons why so many brands and advertisers outside the country still look to the UK as an industry leader.

Sir William Sargent CBE, CEO and co-founder of Framestore, spoke about the power of the partnerships enabled by that demonstrable expertise. He said that Framestore’s recent moves into China were predicated on the fact that the growing Chinese market values the UK’s heritage:

“If I wasn’t positioning Framestore with a view to Asia both in terms of production, tapping into a community creatively, I wasn’t doing my job. Their ambition is for us to build an industry in their country: We’re the only investment outside of China so therefore it’s an inward perception of skills and building an industry. Their view is that they need 30,000 industry professionals just to satisfy the Beijing region demand for creative industries.”

Finally, worldwide chief executive of M&C Saatchi Moray MacLennan provided a timely reminder that for all the issues the UK faces as a result of a potential Brexit, it is still a powerhouse that enjoys historic advantages over other regions.

Consequently, he believes that any export strategy employed by UK firms looking to expand into new regions requires finding local talent, being aware of different payment terms, being flexible and respecting local culture.

Attendees of the breakfast session took away a copy of the report, which demonstrates that the UK advertising sector has significant inherent strengths it can rely on as we move forward. For your own copy of the Exports Report, please email chris.sutcliffe@adassoc.org.uk