Creativity is floundering as brand confidence falls

The declines in corporate confidence, marketing effectiveness and advertising excellence are creating a perfect storm of mediocre work that is undermining the industry, according to creative innovation studio R/GA Australia.

Creative innovation studio R/GA Australia executive strategy director Marie Conley and managing director Victoria Curro

The declines in corporate confidence, marketing effectiveness and advertising excellence are creating a perfect storm of mediocre work that is undermining the industry, according to creative innovation studio R/GA Australia.

The innovation agency’s managing director Victoria Curro told The Growth Agenda the creative industry’s record low performance at this year’s Cannes Festival, where Australia placed equal 11th globally alongside India, was creating a vicious cycle where creativity is being undervalued and marketing is losing respect within corporations.

“Corporate confidence is low, redundancies are at an all-time high, and marketing is a big victim of that,” said Ms Curro.

“There’s a lot of top marketers that aren’t necessarily in roles at the moment, and there’s a lot of people in roles that are feeling fairly uncertain about the future of their roles. When you have that lack of confidence in a team, you tend to do things that are safer, and keep your head down, so that you might not fail, but you might not succeed either.

“The problem is this creates a vicious cycle where marketers are doing less great stuff, and organisations are questioning the value of marketing. And that cycle continues around cost-cutting, reductions and trimming of spend, and it just goes round in this cycle.”

Ms Curro says the fault does not lie with marketers, or agencies, more at the broader corporate culture of uncertainty that has grown steadily over recent years.

“It’s not just cuts in marketing, but it’s cuts in all parts of the business. When you use lose your confidence and your swagger as a business, then it shows in how you go to market,” she adds.

The comments come as the industry nears the end of another tough year where ongoing cost-of-living pressures are continuing to drive down consumer spending and impact brand loyalty as consumers seek out bargains. These challenges have been compounded by reduced marketing budgets and an increase in the use of performance marketing and Media Mix Modelling to boost ROI at the expense of creative marketing.

“It’s the best branding of all time to call it performance marketing,” said R/GA Australia executive strategic director Marie Conley.

“Kudos to the media team. We’ve seen a 62 per cent drop in the effectiveness of performance. And the whole, if you pour your money into performance, it will perform mentality, that’s now come to an end and we’re now entering a new phase.”

Ms Conley also points to rapidly fluctuating search performance, “With Google, we’re seeing numbers that are anywhere from 18 per cent to 80 per cent drop in traffic. With AI impacting search, that’s just going to turn everything upside down.” 

Adds Ms Curro, “We’re too formulaic and too reliant on what we did before. We’ve got into a rut in terms of how your brands go to market, and that’s why all the marketing plans look the same and all the media plans look the same, because it’s all the same.

“Next year is not going to be some sort of hockey stick economic recovery. It’ll be gradual. Marketers are still going to have to fight to win over consumers’ wallets, hearts and minds. However, I think now we’ve got permission to question the formulas, because they’re not working. Effectiveness is down across the board. Behaviours have changed across the board, so let’s free ourselves up to try different things, not just in how brands represent creatively, but in our media choices and how we deliver on our owned channels.”

Ms Curro and Ms Conley argue that with their data showing search and performance marketing are less-effective channels for brands, there is a significant opportunity for marketers to trial different strategies and push creativity to drive differentiation and growth.

Says Ms Conley: “Marketers need to sell the value of their team and their function from a cost centre. To reposition marketing in the organisation as the problem-solving centre, or the opportunity-making centre and rethink where creativity can be applied.”

R/GA Australia says they are seeing a shift in conversations among organisations and marketers which are moving away from interrogating where they can cut money and exploring more around what they can do to grow. The innovation studio wants to seize the moment to issue a clarion call to the industry to stop perpetuating the downward spiral and use creativity to solve the problems.

“Differentiation has always been important. It doesn’t need to be about being brave or risky, it’s just about standing out from your competitors. When CMOs are asked, what are you most concerned about? It’s not necessarily the cost of living and reduced spend, it’s competitors.

“Marketers want differentiation and they need strong provocative ideas that can cut through.

“We’ve been on this knife’s edge, waiting for the economy to just bounce back, and it hasn’t. The moment won’t come. We’ve got to create the moments, and that’s quite exciting,” says Ms Curro.