"Brexit threatens to diminish the U.K.'s international standing,
and arguably has done so already," says WPP CEO Martin Sorrell, who
has been an outspoken critic of Brexit. "One of the reasons we have
doubled down on investment in western continental Europe is to
maintain our influence in critical markets such as Germany, France,
Italy and Spain—four of our top 10 markets
worldwide—and Brussels, where our international competitors
are already seeking to use Brexit against us."
About those high stakes
U.K. advertising is growing at twice the rate of the rest of the
economy and has the highest per capita export value in the world,
according to the Office for National Statistics. For every pound
spent on advertising in the U.K., £6 ($7.79) is generated for
the economy—totaling £4 billion ($5.2 billion) in
exports annually, according to the Advertising Association.
Britain's place as an English-speaking country at the center of
global time zones has historically helped the relatively small
country punch above its weight in everything from creating
international ad campaigns to attracting tech giants. Facebook's
London headquarters has 1,500 people, and Google's has 3,000. Amazon is
moving into a 15-floor office building next year, and Snap is
making London its international base.
But Brexit will keep workers from easily crossing borders. This
potential block on talent is a top concern for the creative
industries.
"We have staff who move between London, Berlin, Madrid and
Prague. ... Any restriction on that will stop us conducting
business in the way we want to and limit the opportunities for our
people," says Adrian Coleman, founder and global CEO of
London-based agency VCCP.
"Clients want a collective view on Europe that takes in local,
cultural nuances. Anything that pulls up the drawbridge is bad
news," he says.
Already the drawbridge is ticking upward, though. EasyJet is
moving its London headquarters to Vienna. And banks including
Citigroup and Bank of
America are shifting jobs from London to Dublin.
Stiff upper lip
With its hire of lobbyist Gagen, the Advertising Association
hopes to stanch some of the bleeding.
"The government is consulting extensively with industry. They've
made a huge effort since the referendum to consult, to understand
and to get insight into what we want and need on a practical
level," says Stephen Woodford, CEO of the Advertising Association.
"We make our point as often and as loudly as we can and we have a
sympathetic hearing every time."
Indeed, at the Cannes Lions International Festival of Creativity
this year, the U.K.'s governmental Department for International
Trade worked with Engine Group on a digital billboard to fly the
flag for British creative talent. It featured a British lion
roaring every time the U.K. won an award, and put the winners'
names in lights. Advertising is also a key part of the department's
"Britain Is Great" campaign, which promotes the U.K. abroad.
"We need to remind people how great we are, and combat the idea
that London might no longer be the center for European advertising
activities," says Paul Bainsfair, director general of the Institute
of Practitioners in Advertising, who worked with the department on
the campaign. "We've left the EU, not Europe."
Marketers are frustrated, though, as there is not a clear
roadmap for what comes next with Brexit.
"There is not much concrete we can do to help our members," says
Phil Smith, director general of the Incorporated Society of British
Advertisers. He points to the impact of post-Brexit inflation on
the retail and packaged-goods sectors, which have already cut
marketing budgets.
In the meantime, Brits will do what they've always done: Keep
calm and carry on. "The best thing we can do is be a true partner
to our clients and to help them plan," says Debbie Klein, CEO of
Engine Group Europe and Asia. "We still have to persuade consumers
to choose one brand over another, regardless of Brexit."
