Britain is due to leave the European Union on 29 March 2019 yet, whilst negotiations are ongoing, there is little clarity over its future relationship with the world’s biggest trading bloc. UK businesses across all industries are therefore assessing their risks and putting procedures in place to gain early competitive advantage.
One sector which will be heavily impacted by Brexit and any ensuing collateral damage to Brand Britain, is the advertising industry.
According to James Murphy, Founder and CEO of adam&eveDDB, Brexit puts at risk Britain’s position as “a gateway for international business, the unique cultural and geographical pivot point between Europe, the Americas and the rest of the world.”
Nearly 36 per cent of the clients in the industry, which accounts for 40 per cent of the revenue, are not located within the UK, and over half of the workforce in London’s advertising industry come from overseas, figures from the UK Advertising Association show.
Britain’s strong ability to attract international talent on a creative, intellectual, strategic and technological level will be put at risk by Brexit, Murphy says, making it even more important that negotiations centre around keeping the UK “open to the world”. Britain needs to continue to welcome international talent, he adds, and uncertainty around immigration must be resolved as soon as possible.
Karen Blackett OBE, Chairwoman, MediaCom UK & Ireland, comments: “Brexit is not within our control and brings with it huge threats to the free flow of talent that underpins our industry; new, complex and expensive regulations that will reduce effectiveness; a threat to consumer confidence, and therefore to marketing budgets, and therefore to the very survival of some brands and agencies; a threat to the diversity of people, thoughts and attitudes, without which our industry will become increasingly irrelevant.”
But, what is being done to support the industry?
Working in partnership with the Department of International Trade (DIT), the Advertising Association has launched Promote UK, a cross-industry group to shine the spotlight on British advertising around the world.
The campaign, designed to position Britain as “the top global hub and centre of excellence for advertising” as Brexit looms, particularly as many UK businesses are reliant on international clients, aims to:
- raise awareness of UK advertising and to target key influencers and decision-makers;
- encourage and support businesses across the sector to secure more international work;
- test new markets and reach out to new clients and partners globally;
- ensure marketing services are included in DIT foreign direct investment pitch presentations across all sectors of the economy.
Janet Hull, Promote UK Chair, said: “We want buyers to feel that, unless they choose a British company, they have not quite bought the best there is. This emotional connection will help to underpin rational selection processes. By co-ordinating efforts across the sector and partnering with Government, and embassies around the world, we will be able to extend our collective reach at a critical time when the UK needs to be even more visible on the world stage.”
How companies respond to Brexit will be critical to their success. Whilst we cannot determine the outcome of the negotiations, what is essential is that businesses prepare now for both the impending short-term risks, as well as for the opportunities presented, thereby giving themselves every chance of success in the post Brexit environment.
Our SME experts at Beavis Morgan work with businesses and individuals in the entertainment, media and creative industries, assisting with their plans, establishing the market for their product through research, analysing their financial requirements both now and for the future, and putting processes in place to enhance cashflow, leverage tax smart strategies, minimise risk, and drive financial success and business performance.
Our research and development (R&D) tax relief specialists have also made successful claims for advertising businesses through the government R&D tax credit scheme, securing significant ‘money back for research and development’ when some were previously unaware they could.
Contact Steve Govey* or your usual Beavis Morgan Partner for further information about how we can assist you and your business.
*Note: Beavis Morgan Partner, Steve Govey, provides regular commentary in Campaign magazine and is a specialist adviser to businesses in the advertising industry.