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Back to the future: Advertising Pays in 2025

by Bryce Coombe


Earlier this year, the Communications Council released Advertising Pays: The Economic, Employment and Business Value of Advertising in conjunction with Deloitte Access Economics - The first comprehensive study into the broader economic impact of Advertising in the Australian economy.

It’s a highly detailed and intensely researched study that measures the economic impact of our industry as it stands today. But as an agency that’s charting the course for the future agency model, we were keen to understand what this impact would look like tomorrow.

How will Advertising continue to pay and impact the broader Australian economy, and what will the macro economic trends be?

To find out we spoke to Tony Hale, CEO of The Communications Council. Apart from commissioning the Advertising Pays report, Tony has also been the CEO of The Newspaper Works and held Director positions at both Clemenger BBDO and The Campaign Palace.

In addition to this wealth of experience, Tony is also a believer in the power that advertising and brand can have on businesses.

“What we’re expecting to change in the future is businesses’ ability to differentiate and offer real competition. And that’s where advertising plays. Advertising will continue to have a major impact on competition, innovation and employment, and these areas are the most significant areas where businesses can maintain a competitive advantage.”

So how can clients get the most out of their agency partners to maintain their competitive advantage and what should you be looking for in your agency partner of choice?

1. Use the agency as business innovation providers

One of the stand out statements in the original Advertising Pays report affirms that “Advertising has a role to play in corporate strategy”. This is something that we at CHEP firmly believe in. But we wanted to know how Tony saw this change over the next few years and if this will diminish or increase by 2025.

“The opportunity in the future is for agencies to address bigger and more meaningful business questions beyond traditional marketing requirements.

Australia will always be a hub of advertising advancement and innovation. Creative innovators will always be grown and develop their craft here. It’s in our culture and not easily replicable in other markets.

In fact, in the next few years, we see much greater value and a higher premium being placed on that level of innovation as its role delivering a competitive business advantage increases.”

2. Drive growth through brand equity

Often, agencies and the work they produce can be seen as a commodotised business cost rather than a valued business asset. But as Tony points out, the businesses that have invested in building their brand equity have also experienced long-term growth.

“All businesses want growth, but many corporates appear to have lost sight of the legitimate and effective role that advertising can play. As Peter Field says; sales, discounts and price incentives will never drive long-term business growth. All CMO’s, CFO’s and CEO’s are looking for long-term growth.

When you look at a brand like Sainsbury’s in the UK, there is a direct correlation between their investment to build brand equity and their long-term business growth.”

But with the democratisation of creative production, the challenge to maintain and invest in quality brand building has increased. “Anyone can create something, post it and promote it,” Tony says “but you still need the highly specialised skills and agency expertise that creates content that people actually choose to engage with.”

For those that have been lucky enough to see a presentation from Ben Birchall or Mike Doman you would know how important that sentence is to us - “Content that people choose to engage with”. The agency partners that will drive your brand equity and business success will be those that understand the power of compelling content across all user experiences – not just the 30-second TVC.

3. Work with people that make your palms sweaty

Amidst all the discussion and debate about the macro trends industries will face in the next five years, Tony believes it’s clear that the most important macro trend is actually much more personal – it’s people.

“Ten years ago, everyone thought they needed a specific digital specialist. But that idea just doesn’t make sense anymore. The agencies that succeed are the ones that create an environment where everyone works together naturally and in a fully integrated manner.”

And that’s the thing that makes agencies compelling partners to clients. Agencies can be the place where weird, wonderful, incredibly intelligent and remarkably creative people can come together to solve hairy, complex problems for their clients.

So as the economic forecast continues to darken, competition increases and price sensitivity drives margins down, ask what creative innovation and thinking your agency partners could bring to your business problem, to look at it with new insight and opportunity.

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