New Year predictions are tricky at the best of times. With sluggish growth and global economic uncertainty, however, the runes for 2003 seem harder to read than most.
Media buyers were talking themselves into optimistic mood before Christmas at the end of one of advertising’s worst years on record. Zenith forecast 2.9 per cent growth globally this year, based on continued consumer spending.
A pickup in advertising activity could signal design investment is soon to follow. But consultancies and industry analysts are generally cautious about their business prospects.
‘It will be another very tough year,’ says Corporate Edge director Peter Shaw. ‘Everyone [is] fighting hard for business, prices keep coming down [and] big groups will take on loss leading business.’
Jill Marshall, Design Bridge managing director for branding and packaging, hopes that the ‘interminable downward pressure on costs – spearheaded by procurement managers – will ease’, improving consultancies’ profitability and lessening the need for redundancies.
But others find little evidence of a change in clients’ mindsets. ‘Creative processes have got to be – and be seen to be – more efficient and effective, as procurement continues to be an integral part [of how work is commissioned],’ says Amanda Merron, partner at accountant Willott Kingston Smith.
Design Business Association chairman and Priestman Goode director Paul Priestman observes, ‘The successful groups are the ones that stay nimble and are able to predict and react to market and client requirements. As always, the consultancies which produce consistently excellent work will be the ones that are the busiest and maintain standards even in the most difficult times.’
Speed to market is a priority for clients and this determines much about how consultancies must run their projects, Priestman suggests. This is one reason for the rise of smaller independent groups, often at the expense of larger players – a trend that is set to continue, many believe.
Peter Melling, managing director of Hull-based group The Core, makes his predication in no uncertain terms – ‘smaller, leaner, fitter, faster, ideas-led groups. Less strategic bollocks – more real design’. According to Radford Wallis partner Stuart Radford, ‘Size doesn’t matter.’ He points to a cadre of consultancies that have ‘built a reputation based on creative and effective design’.
‘As the economic downturn continues to gain momentum in 2003 and budgets are reduced further, larger organisations commissioning the larger projects will question the often expensive design costs demanded by the bigger design groups,’ he says.
JHP managing director Steve Collis predicts design clients will ape their advertising counterparts in commissioning ‘creative powerhouses rather than the mega-groups’.
The pressure is on the larger players, many of whom are still consolidating, to strike a balance between scale and creativity. ‘Boardrooms will be looking for the best brain rather than the biggest engine,’ says Collis.
According to No One design directors David Law and Simon Manchipp, ‘If they [the large design consultancies] fail to realise that clients are looking for smarter and more economic groups, the outlook is bleak. One-stop branding shops will lose ground to groups of specialists linked by informal alliances. The difficulty will be retaining strategic coherence – keeping everybody singing from the same songsheet.’
Collis adds, ‘If a practice is truly innovative it should be able to demonstrate this through the line in any media.’
In terms of creative output, consumer scepticism towards branding ‘hype’ is heralding a back-to-basics approach, suggests Cut The Mustard design director Robin Dunlop. ‘The consumer is no longer appeased by a design facia to products,’ he says. ‘Design-conscious aesthetics are now are a full expectation.’
Smith & Milton creative director Stuart Redfern adds, ‘Corporate identity will suddenly develop a sense of humour. Or, corporate identity will desist from being intensely serious and instead develop a sense of humour and wit.’
Intro creative director Adrian Shaughnessy says it is worth ‘trying to coax clients out of their bunker mentalities’, but issues a word to the wise. ‘When times are hard, you need to be extra brave – although, as we all know, the opposite happens.’