WPP’s Katie Rigg-Smith says that creativity – in all its guises – is an investment, not an expense. Now the Creative Capital Index for Australia proves that
The Creative Capital Index allows us to quantify the return on investment of creativity. Global brands in the top 10% of Creative Capital outperform all other brands. So, what does this mean for Australia specifically?
When we look at the top brands for Creative Capital in Australia, we can see global brands but, importantly, we can also see local brands performing well for Creative Capital.
What we discovered when we interrogated WPP’s BAV consumer data – upon which the Creative Capital Index is built – is that brands in Australia that have high Creative Capital also have much higher financial returns. So, in Australia, the brands that appear in the top 5% for Creative Capital outperform the ASX200 by 147%. This is a clear demonstration that creativity is a growth catalyst for business.
So why do brands with high Creative Capital also have high financial performance and deliver investor returns? Because creativity is inspiring, and we are all looking to be inspired. But let’s remember, according to WPP’s Creative Capital Report, creativity is not just about the external facing brand; it is about the business in all its guises, including innovation, product line, customer experience, and so on.
It follows that, if you’re creative and inspiring – as a business – consumers lean in and buy your products. That’s why we see the financial return.
Why all this matters to clients
CMOs are accountable for every dollar they spend. Companies report on marketing spend not only internally but there is also an expectation that the agencies they work with report in this way too. But what companies need now is a new – additional – narrative to report against.
Yes, companies measure brand equity – or influence as we call it in the Creative Capital Report – and brands are tracked, campaign performance metrics are collected, and there are clear customer metrics to be reported against too. But what does it all mean to the trajectory of the business and how do you translate all this reporting into meaningful business strategy?
And, importantly, how do you convince the CFO – and the CEO – that marketing spend is money well spent? Clearly, they need to be convinced that marketing is one of the levers of economic success. This is what we set out to prove when we launched the Creative Capital Index, and when we tested it against Australian companies and their performance on the Australian Stock Exchange.
The power of language
Perhaps the stumbling block is the translation of the language of marketing into the language of boardroom. Too often we get caught up in vanity metrics that do not deliver tangible business growth. By using tools like the Creative Capital Index, we get closer to the language of the boardroom, we start to shift the intangible idea of creativity into something tangible and measurable, and we can see – in clear boardroom terms – that marketing drives business growth.
At its heart, marketing is about building futures and protecting what matters. And CMOs are storytellers. They tell the story of the business – to the boardroom as well as to their external audiences. They have the data (it’s all there in WPP’s BAV consumer data) and now it is a question of translating that data into the story the board will find engaging.
After all, it’s fabulous to be highly awarded for creativity – we all love an awards ceremony – but financial returns and shareholder value are the language of the boardroom. And now we have a tool that will help us translate the story of marketing into the story of business growth.
KATIE RIGG-SMITH
WPP