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Where can Global Advertisers find the best Creative Value?

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This post is by Darren Woolley, Founder of TrinityP3With his background as analytical scientist and creative problem solver, Darren brings unique insights and learnings to the marketing process. He is considered a global thought leader on agency remuneration, search and selection and relationship optimisation.

The global marketplace is increasingly becoming a global village thanks to the pervasiveness of the internet and growing mobility. The days of ‘centres of excellence’ are passing, as talent now has the ability to collect into cohorts anywhere in the world.

For a global marketer looking to tap into the sources of world-class creativity, the issue is one of not only identifying the location of this creative talent but also the relative cost of assessing their value.

To provide a measure of creative value requires a consistent and recognised measure of creativity and a measure of cost, together producing a Creative Value Index (CVI). By sourcing existing creative and cost metrics, we have been able to apply the methodology to calculate a CVI that allows global and regional advertisers to identify markets offering exceptional value for creativity based on performance and cost.

A measure of creativity

Creativity is at the core of the advertising process and is certainly one of the main attributes marketers and advertisers look for in selecting an advertising agency. The industry itself recognises and rewards creativity through an extensive network of award shows, global, regional and local that amount to around 700 per year on the last count.

Agency networks and their holding company owners look to their performance at these award shows to validate their creative reputation, especially in the major award shows that are recognised globally.

One of the most trusted and reliable monitors of creative performance is the Gunn Report, which collates creative award performance by agency and by market to produce a ranking of creativity. Their methodology for preparing this score and ranking is provided here

Creative value in global advertising.

Based on their published 2016 results for creativity by market for the top 25 markets, provided below courtesy of the Gunn Report, it would be reasonable to consider that the top ranking countries are to be recognised as the most creative markets in the world and therefore the countries where the top creative work could be sourced.

But does this represent creative value or simply creative performance?

CREATIVE RANKING 
RANKINGCountryGunn Report Creative Total By Country 2016 *
1USA (1)410
2UK (2)210
3AUSTRALIA (3)114
4BRAZIL (4)107
5ARGENTINA (5)105
6NEW ZEALAND (6)98
7FRANCE (7)89
8SPAIN (8)86
9JAPAN (9)85
10SWEDEN (10)83
11GERMANY (11)82
12UAE (12)59
13INDIA (13)51
14THAILAND (14)46
15THE NETHERLANDS (15)38
16CANADA (16)37
17SOUTH AFRICA (17)29
18BELGIUM (18)23
20NORWAY (19)22
19MEXICO (19)22
21SINGAPORE (21)19
22RUSSIA (21)19
23CHINA (23)18
24SWITZERLAND (24)16
25ITALY (24)16
* Gunn Report 2016 (Gunn Ranking)

The impact of scale on creative ranking

Reviewing the results we also wondered how the size of each of these advertising markets impacted on the Gunn Report creative score. After all, the larger the market, the more advertising or creative opportunities, the more likely to attract creative talent and the more likely to enter the major creative awards.

This last point was raised by an agency CFO who explained that in regional markets the budget for the cost of Award entries was set as a percentage of revenue so that the smaller the market and the agency the less awards they could enter.

One of the ways to overcome any bias on entry numbers is to assess the number of entries by market for the Awards Shows considered by the Gunn Report. But even then it would not take into consideration the opportunities presented to agencies in larger and more active markets.

Creative value in global advertising.

We considered a number of filters to apply as a measure of market size including GDP, population and media advertising spend. The most relevant to the category is media advertising spend and the data by country for 2015 was provided by WARC  (2016 is incomplete and still being complied).

The results here are shown as an Index against the average for the 25 markets with an Index of 100 being the average.

CREATIVITY BY MARKET SIZE 
RANKINGCountryCreative by Media Spend Index *#
1NEW ZEALAND (6)500.62
2UAE (12)351.90
3SWEDEN (10)210.18
4ARGENTINA (5)160.04
5SPAIN (8)140.82
6SINGAPORE (21)117.34
7THAILAND (14)106.57
8AUSTRALIA (3)91.34
9NORWAY (19)90.29
10THE NETHERLANDS (15)81.20
11SOUTH AFRICA (17)81.07
12BRAZIL (4)76.18
13INDIA (13)69.43
14UK (2)67.86
15BELGIUM (18 )60.99
16FRANCE (7)55.96
17MEXICO (19)40.14
18SWITZERLAND (24)37.36
20GERMANY (11)33.70
19RUSSIA (21)31.21
21CANADA (16)31.00
22JAPAN (9)22.73
23USA (1)21.81
24ITALY (24)17.07
25CHINA (23)3.17
* Gunn Report 2016 (Gunn Ranking)
# Media Spend 2015 WARC

This had a significant impact on the top 5 with smaller markets such as New Zealand, UAE, Sweden and Spain now included with Argentina. USA, Brazil, Australia and the UK dropped to 23. 12, 8 and 14 respectively. So it is evident that scale has an impact on creative ranking perhaps due to opportunity or a sampling bias.

The concept of Creative Value

While we have examined creative rankings courtesy of the Gunn Report and the impact on these rankings due to scale thanks to the WARC media spend data, we have not yet defined creative value.

The financial concept of value is benefit derived for dollar spent and so using the agency charge out data from Ad Cost Checker for creative roles in the various markets we were able to create an index of creative costs per market.

We philosophically chose to use the high benchmark rates for each market on the assumption that Award winning creative work would usually be executed by highly acclaimed and remunerated practitioners, relative to the market. The data is kept in the Ad Cost Checker database in local currencies and so all rates were converted to US Dollars for comparison using the Foreign Exchange spot rate taken on May 08, 2017 02:49 UTC 

Creative value in global advertising.Therefore applying a creative cost index to the Gunn Report creative ranking by market produces the following results. The results here are shown as an Index against the average for the 25 markets with an Index of 100 being the average.

CREATIVITY PER DOLLAR VALUE 
RANKINGCountryCreative Value Index *^
1ARGENTINA (5)603.22
2USA (1)196.54
3BRAZIL (4)182.09
4INDIA (13)155.16
5UK (2)146.05
6MEXICO (19)134.96
7THAILAND (14)125.32
8AUSTRALIA (3)110.57
9NEW ZEALAND (6)107.12
10SPAIN (8)89.30
11JAPAN (9)85.01
12UAE (12)74.15
13SWEDEN (10)70.82
14SOUTH AFRICA (17)62.73
15CANADA (16)52.17
16GERMANY (11)52.01
17THE NETHERLANDS (15)51.93
18CHINA (23)51.26
20FRANCE (7)50.27
19RUSSIA (21)26.83
21NORWAY (19)17.59
22ITALY (24)16.61
23SINGAPORE (21)14.95
24BELGIUM (18)13.92
25SWITZERLAND (24)9.42
* Gunn Report 2016 (Gunn Ranking)
^ Creative Charge Out Rates 2016 Ad Cost Checker

The big shift here is India jumps from 13 to 4 and Argentina is the highest value moving from 5 to first position. The value of the large and highly ranked markets, particularly the USA and the UK are only affected marginally, possibly because the competitive size of those markets keeps creative costs in check.

Meanwhile Australia drops out of the top 5 to 8 due to the relative high creative costs and many Western Culture markets fall, the largest fall being France, which drops 12 places on the creative ranking.

The impact on Creative Ranking of both scale and cost

While market size and scale made a significant impact on the Creative Rankings and promoted those smaller markets who were performing “above their weight” creatively, the Creative Cost had a marginal effect caused by the higher cost of the established markets and the relative lower cost of the emerging markets.

Creative value in global advertising.

So lets look at what these two filters do to the Creative Ranking based on Media Spend and Creative Costs. The results here are shown as an Index against the average for the 25 markets with an Index of 100 being the average.

CREATIVITY PER DOLLAR BY MARKET SIZE
RANKINGCountryCreative Value Indexed by Media Spend *^
1ARGENTINA (5)580.71
2NEW ZEALAND (6)345.62
3UAE (12)279.33
4THAILAND (14)183.38
5MEXICO (19)155.55
6INDIA (13)133.41
7SWEDEN (10)113.27
8SOUTH AFRICA (17)110.77
9SPAIN (8)92.36
10BRAZIL (4)81.88
11THE NETHERLANDS (15)70.10
12SINGAPORE (21)58.31
13AUSTRALIA (3)55.96
14NORWAY (19)45.59
15UK (2)29.81
16RUSSIA (21)27.84
17CANADA (16)27.61
18BELGIUM (18 )23.31
20FRANCE (7)19.96
19JAPAN (9)14.36
21SWITZERLAND (24)13.89
22GERMANY (11)13.50
23ITALY (24)11.20
24USA (1)6.60
25CHINA (23)5.69
* Gunn Report 2016 (Gunn Ranking)
# Media Spend 2015 WARC
^ Creative Charge Out Rates 2016 Ad Cost Checker

As we noted, the impact on market size is significant and highlights New Zealand as a market that outperforms its relative size. But the creative cost certainly promotes the creative of markets such as Argentina, UAE, Thailand and Mexico.

The ups and the downs of creative ranking and value

We looked at how each of these filters impacted the market ranking from the original Gunn Report creative ranking for 2016. The figures in red with brackets are the falls in ranking and the figures in black are the rises in ranking based on the relative index.

On Scale the largest markets including USA, UK, Japan, France and Brazil had the largest fall in ranking, which is to be expected. For Value the European Countries including France, Germany, Belgium and the odd one out Australia had the biggest fall due to relative cost. The big risers on Value were India, Thailand and Mexico, where lower creative costs significantly increased Creative Value.

Interestingly USA, Japan and UK had only modest falls in ranking of up to three places.

CREATIVE RANKING RISE & FALL BASED ON FILTERS
Scale Rank DifferenceValue Rank DifferenceValue & Scale Rank Difference
USA (1)(22)(1)(23)
UK (2)(12)(3)(13)
AUSTRALIA (3)(5)(5)(10)
BRAZIL (4)(8)1(6)
ARGENTINA (5)144
NEW ZEALAND (6)5(3)4
FRANCE (7)(9)(12)(12)
SPAIN (8)3(2)(1)
JAPAN (9)(13)(2)(11)
SWEDEN (10)7(3)3
GERMANY (11)(8)(5)(11)
UAE (12)1009
INDIA (13)097
THAILAND (14)7710
THE NETHERLANDS (15)5(2)4
CANADA (16)(5)1(1)
SOUTH AFRICA (17)639
BELGIUM (18)3(6)0
MEXICO (19)21314
NORWAY (19)11(1)6
SINGAPORE (21)15(2)9
RUSSIA (21)115
CHINA (23)(2)5(2)
SWITZERLAND (24)6(1)3
ITALY (24)021

The combination of the Value and Scale index played out across the range, penalising the larger markets for their scale and promoting the smaller and lower cost markets for their value.

So where can Global Marketers find Creative Value?

If a global advertiser is looking for creative excellence by market, the Gunn Report for 2016 suggests that the five top markets are: the USA (1), UK (2), Australia (3), Brazil (4) and Argentina (5).

If a global advertiser is concerned that market size is impacting the Gunn Report results, then after taking scale into consideration, the top five creative markets are: New Zealand (6), the UAE (12), Sweden (10), Argentina (5) and Spain (8).

On pure creative value, being the Gunn Report creative score per US dollar in creative costs, a global advertiser should look to these top five markets: Argentina (5), the USA (1), Brazil (4), India (13) and the UK (2).

And finally, a global advertiser looking for creative value adjusted for market scale should look to these top five markets: Argentina (5), New Zealand (6), the UAE (12), Thailand (14) and Mexico (19).

Based purely on the numbers here, the best value is gained for an advertiser’s dollars by investing in creative from Argentina, with or without consideration of market scale.

Scale certainly has a significant impact on creative ranking in the Gunn Report, and creative value makes slight but meaningful adjustments to the ranking.

The limitation of this type of analysis is that we have not taken into consideration issues concerning language and cultural differences. But in what is increasingly becoming a global village, the barriers associated with these differences could be minimised.

Ultimately, value is in the mind of the buyer, but we hope that this analysis has at least provided food for thought concerning the opportunities for creative value in the global advertising market.

Read the reaction of the leading Creative talent from around the world here in The Drum article published July 3, 2017

To find the best creative value for yourself download a free copy of the ‘Identifying creative value for global advertisers’ White Paper here

To find out how your agency creative rates compare with the market in more than 20 global markets check out Ad Cost Checker here

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Darren is considered a thought leader on all aspects of marketing management. A Problem Solver, Negotiator, Founder & Global CEO of TrinityP3 - Marketing Management Consultants, founding member of the Marketing FIRST Forum and Author. He is also a Past-Chair of the Australian Marketing Institute, Ex-Medical Scientist and Ex-Creative Director. And in his spare time he sleeps. Darren's Bio Here Email: darren@trinityp3.com

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