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Record exports make advertising a great British success story

Record exports make advertising a great British success story

Advertising Association

5 min read Partner content

Newly released figures paint a picture of rude health for the UK’s advertising and marketing exports in 2019 – so how will the industry cope with the challenges posed by the pandemic?

The Advertising Association’s recently published UK Advertising Exports Report 2021 wasn’t short of headline figures. The report covered the latest data taken from 2019, when 7% year-on-year growth led the industry to a new record level of £11bn in international trade. That put UK exports of advertising and market research services in third place among comparable industries, behind insurance and pension services (at £20bn) and computer services (£12bn).

This phenomenal rate of growth is made all the more impressive by a jump in the number of registered advertising and market research companies engaging in either exporting or importing goods and services, from 25% in 2017 to 37% in 2018. This suggests that the increase in exports isn’t simply driven by the same companies exporting more than before; but by more companies exploring and exporting to foreign markets.

This adaptability is also reflected in the data collected on which countries are importing UK advertising services – unsurprisingly for an industry with innovation built into its DNA, companies appear to be actively seeking new markets in the wake of Brexit. In fact, EU nations accounted for 40% of exports, down significantly from the previous year’s figure of 53%.

UK advertising is the world’s centre of excellence and a gateway for companies looking to go global

The US remains the largest single-country importer of UK advertising and market research services, importing £1.1bn worth of UK advertising and market research services, with France (£785m), Germany (£712m), Switzerland (£643m) and Ireland (£539m) the next largest importers.

Recognising this shift in target markets, Minister for Exports Graham Stuart congratulated the sector on its “exceptional” growth, adding: “It is clear the industry is reorienting to the fastest growing international markets which, with government support, places the sector in the best possible position for the future.”

But what does that future hold for an industry that, like so many others, has been hit hard by the pandemic? As part of the report, think tank Credos polled members of the UK Advertising Export Group (UKAEG) on their expectations around winning new business, the global Britain agenda, Brexit and other upcoming challenges.

While the analysis showed largely positive sentiment across much of the data gathered, concerns were detected around the prospects for securing new business in 2021. Both COVID-19 and Brexit were cited as factors that members feared could lead to budgets being cut or market access being limited, with travel restrictions highlighted as a potential barrier to business development for many.

Despite the clear challenges, industry leaders and onlookers alike remain upbeat about the sector’s exports outlook. Damian Collins MP, the former chair of the Digital, Culture, Media and Sport Committee, acknowledges the issues faced by the industry, but is confident in the UK’s staying power.

“As we went into 2020 and the year of COVID, ad spend has fallen across most media and so that obviously remains a challenge for the advertising industry, as well as media owners,” he told The House, adding: “But London is recognised as a global centre of excellence for the advertising industry, both in terms of creativity and technical capability as well. It’s far and away the biggest creative hub in Europe.” 

It’s a sentiment echoed by Janet Hull, Chair, UKAEG and IPA Director of Marketing Strategy in her comments about how the UK’s natural competitive advantages ensured exports continued apace in 2020. 

“UK advertising is the world’s centre of excellence and a gateway for companies looking to go global,” she commented. “We can work with China and the US in the same day. Despite the unprecedented social and economic pressures of the last year, UK Advertising Export Group members continued to service a global client base, and even expand internationally, with new office openings in key markets and increasing headcount at home.”

Strong export growth isn’t just about indigenous companies reaching outwards; it’s about brands in foreign markets broadening their own horizons with international or UK-only briefs. Happily, there does appear to be momentum on this front and despite the travel restrictions and budget reductions induced by the pandemic, businesses such as BMW, Emirates, Carlsberg, TikTok and Icelandair all appointed UK agencies in 2020. 

It’s a pattern Martin Jones, Managing Partner at AAR, recognises: “Reassuringly, there were very few clients with international or global requirements who appointed agencies outside of their ‘home’ country other than the UK; a clear testament to the work that has been carried out to promote the UK as ‘the place to go’!”  

A year after nerves were first set on edge by the pandemic, the trends and figures highlighted in the report represent much-needed positivity for the industry.

“The full impact of the past year on exports will not be known fully until next year,” Stephen Woodford, Chief Executive of the Advertising Association acknowledges, “but with the vaccine roll-out continuing apace and the global economy making the return to normal, now is the time to look forward and plan for the future and to demonstrate that the UK is not only open for business but remains the undisputed global hub for advertising and marketing services.”

 

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