Creativity beats global reach in choosing an ad agency
LONDON - Advertisers still rank creativity as the most important factor in choosing an advertising agency, rating it higher than international reach, price and diversity of marketing services offered, according to a new report from Goldman Sachs.
The findings come as part of a report into the global advertising market by the investment bank.
The Goldman Sachs Global Ad Survey 2003 looked at the long-term strategy of the big advertising groups and compared it with the strategy of advertisers, and found that there were some similarities, such as a greater emphasis on below-the-line marketing, a gradual move away from network television, and a shift towards Latin America and Asia Pacific.
However, it found that while the advertising groups, such as WPP Group, Havas and Publicis Groupe, were focusing on improving global reach and having a full range of marketing services under one umbrella, this was not the major concern of the advertisers. Rather, nearly 80% of marketers said that creative reputation and performance was critically important. By contrast, just over 10% said that international reach was critically important.
Marc Sugarman, a lead financial analyst at Goldman Sachs, said: "A vast majority of marketers at the local level indicated that it was either not really or not at all important that all their marketing services providers are part of one holding company."
He said that advertisers that were looking to consolidate below-the-line functions would be careful not to curtail the autonomy of local brand managers too far.
The contrast of global reach versus creativity follow comments made recently by Sir Martin Sorrell, the WPP Group chief executive, who said that the one-size-fits-all global marketing mantra has gone too far and it was now time to swing back the other way.
Sir Martin, who as chief executive of WPP has, as much as anyone else, led the global marketing charge, said that he thinks "we're losing country focus".
The survey found that financially, the advertising industry is set for a muted recovery in 2004 and 2005, in line with predictions of the ad industry including Sir Martin, who has long said that the 2004 Olympic Games and US Presidential elections will provide a much-needed boost.
Respondents were generally positive on the economic outlook, with 64% saying that the economy was getting better or about to get better, while 13% said it was about to get worse.
Goldman Sachs said it was forecasting global advertising growth of 4.1% globally, while the US would rise by an estimated 4.5%. But it warned that budgets were not set in stone and are likely to be revised.
The Goldman Sachs survey quizzed 55 brand managers at major multinational groups estimated to be responsible for managing brands with an annual adspend of over $4bn (£2.4bn).
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