Does big, splashy advertising pay off in tough times?
Is there any point at all in companies lavishing millions of rand on award-winning advertising campaigns?
With more than 50% of South Africans living below the poverty line, many more in debt and most of the rest cautious about spending, is there any point at all in companies lavishing millions of rand on award-winning advertising campaigns?
The answer, say advertising agencies, is a resounding yes. During times of economic stress when discretionary spending is limited, it may be tempting to play safe and simply keep marketing ticking over, but the potential long-term damage to turnover and brand strength is considerable. If you’re not noticed, you might as well not be there at all.
You’d expect agencies to say that. More work means more income for them. Award-winning work attracts not only new clients but also the best advertising talent.
The biggest winners, though, are clients, the agencies say. To outsiders, most advertising awards shows are an orgy of industry self-congratulation of no relevance to outsiders.
However, Charl Thom, MD of the local FoxP2 agency, quotes a UK study of 213 advertising campaigns, which found that those winning creative awards were 11 times more effective than non-winners in generating revenue and market share for clients.
Ryan McManus, executive creative director of the Native VML SA agency, says: "Sales volumes and market share don’t lie. The most creative, innovative brands are the biggest in the world. They speak to people and create lifetime loyalty. Creativity is at the heart of every one of them."
That’s the giants. What about ordinary companies and market newcomers? The trouble is that until a campaign is aired, no one knows if it’s going to make an impact. Pre-production market research is no guarantee of success. The number of dud campaigns on the go at any one time is testament to that.
In his book, Predatory Thinking, British adman Dave Trott reckons that 4% of UK work is remembered positively, 7% negatively and the remaining 89% neither noticed nor remembered.
That’s a lot of wasted work — and money. So it’s no wonder that South African marketers are nervous of spending in today’s economic climate. Fran Luckin, chief creative officer at ad agency Grey Africa, says: "It is making clients cautious about spending. They are less inclined to take risks."
Emphasis is on short-term sales instead of long-term brand building. The temptation, therefore, is to cling to tried-and-tested ideas.
That attitude is not unique to stressed brands. Native VML CEO Jason Xenopoulos says: "Successful ones are often the last to take chances. When things are going well and market share is growing, there is a reluctance to rock the boat. Why fix what isn’t broken, right? Wrong.
"In many cases, successes are just one step away from failure. What worked yesterday probably won’t work tomorrow. The bravest clients are those who understand how vulnerable they are.
"Courage is born out of fear. It’s about taking risks despite your fear."
Client bravery, say agencies, is more important than deep pockets. The idea that great creativity has to be expensive is wrong.
Xenopoulos almost agrees: "Money has nothing to do with the quality of the idea but it does impact the quality of the execution. Some ideas require big budgets and if they are starved of funding, they will fall short of their potential."
South African agencies keep campaign budgets close to their chests. Boasting is more prevalent overseas, where $10m budgets are not uncommon. The most expensive campaign is thought to be one for Chanel No5 perfume, costing $30m.
McManus has sympathy for cash-strapped local clients, particularly those whose advertising budgets have been cut by multinational parents. Many of those parents impose global campaigns on multiple markets, leaving small change for local input.
Their South African marketers "respond by operating from a place of safety or even fear", he says.
"I worry hugely about these clients and their brands. I think consumers can smell when something is dying and that stench drives them away. When a brand stops acting confidently, people don’t want to be associated with it."
The core purpose of advertising is to get a brand noticed, points out Luckin. The risk lies not in doing something different but in doing the same as everyone else and hoping you’ll stand out. That smacks of Albert Einstein’s definition of insanity: doing the same thing repeatedly and expecting different results.
Thom observes that if an ad is "not thought-provoking, not breakthrough" it will be washed away by the flood of other marketing messages.
Keith Weed, global chief marketing officer for the Unilever group, told the 2017 Cannes advertising festival: "If you don’t take risks, your ad won’t get noticed and that will be the most expensive ad you have ever made."
But Luckin adds a rider: "Risky doesn’t mean reckless. A brave idea that’s not firmly situated within the brand’s identity, purpose and overall strategy is irresponsible."
Creativity for its own sake is as dangerous as being uncreative. How many adverts have we seen where we marvel at the skill and imagery but can’t remember what they were selling? A visual "wow" factor does not work on its own. Great creative work, according to Xenopoulos, "combines entertainment and utility in a way that adds value to people’s lives.
"The most critical element of any successful campaign is the human insight on which it is built. Insights are the bedrock of great creativity and the key to commercial success. Without a great insight, your work will not resonate with its audience."