The Case for Creativity

December 2012

Two decades’ evidence of the link between imaginative marketing and commercial success

Is more creative advertising more e!ective advertising?

This presentation is a summary of the "ndings of "fteen studies comparing the e!ectiveness of more creative and less creative advertising, agencies and companies The studies were conducted in North America, UK, Europe, Asia & Australasia, and span two decades from 1990 to 2010 They were conducted by university academics, industry researchers, the IPA and McKinsey & Company They all reach the same conclusion, and there are no known studies that con#ict with that conclusion The studies are discussed in more detail in the book ‘The Case for Creativity’ by James Hurman

More creative advertising is more e!ective advertising

In 1996 and 2002, while at Leo Burnett, Donald Gunn twice produced his ‘Do Award Winning Commercials Sell?’ study. In both cases he collected the case histories of the 400 most awarded recent campaigns in the world, along with quanti"ed evidence of their business results. He found that 86.5% and 82% of those awarded campaigns, respectively, had met or exceeded their clients objectives. This is an improvement on advertising in general, which is shown to generate a sales result around 70% of the time. Proving not only that creatively awarded advertising tends to be e!ective, but also that it tends to be more e!ective than advertising in general.

Percentage of advertising campaigns shown to produce a business result

Creatively awarded advertising

Advertising in general

84%! 70%!

SOURCE: Gunn, ‘Do Award Winning Commercials Sell?’ 1996, 2002; Jones, ‘When Ads Work’, 1995; McDonald, 'How frequently should you advertise?', 1996; Brandes, 'How advertising works in Germany', 1996!


In 2010, Peter Field, an independent contractor to the UK’s IPA, studied the 257 IPA E!ectiveness Award winning campaigns since 2000. He contrasted the campaigns that had won a major creative award against those that hadn’t, and measured their relative e!ectiveness. His "rst "nding was that the creatively awarded campaigns were eleven times more e$cient at generating a market share increase.

Average points of market share growth per 10 points of excess share of voice

Creatively awarded advertising

Non-creatively awarded advertising

5.7! 0.5!

SOURCE: Field, ‘The Link Between Creativity and Effectiveness’, 2010


Peter’s second "nding was that the creatively awarded campaigns were much more certain to achieve that result. The less creative campaigns were not only less e$cient, but also less predictable than the creatively awarded ones. This suggests a departure from the conventional wisdom that a more creative approach is a ‘riskier’ one.

E$ciency of creatively awarded campaigns vs non-awarded campaigns



Peter’s third "nding was that the creatively awarded campaigns achieved a higher ‘E!ectiveness Success Rate’ than the non-awarded campaigns. This is a measure of achieving ‘very large business e!ects’, ie, signi"cant improvements in market share, penetration, pro"tability, etc. The creatively awarded campaigns were shown to be 10% more e!ective on a high spend, and 27% more e!ective on a low spend.

LOW ESOV SPEND <6%

Awarded

88%! 80%!75%! 59%!

Non-awarded Awarded Non-awarded

HIGH ESOV SPEND >6%

Advertising E!ectiveness Success Rate: creatively- vs non-creatively awarded



Peter’s fourth "nding was that as the campaigns got more creatively awarded (i.e. achieved a higher Gunn Report score for achieving greater quality and quantity of awards) they got more e!ective. Campaigns that produced a higher number of very large business e!ects (i.e., signi"cant improvements in market share, penetration, pro"tability, etc) also had a higher Gunn Report score.

The most creatively-awarded campaigns are also the most e!ective

Low ( 0-1) High (2+)

Number of Very Large Business E!ects

3.1!

AVERAGEGUNNREPORTSCORE!

2.0!

AVERAGEGUNNREPORTSCORE!


More creative agencies are more e!ective agencies

In 2011, the 16 UK and US agencies that had featured in the Gunn Report top 50 more than twice between 2006 and 2010 were compared with the 16 largest and most successful, but less creatively awarded agencies, from the same markets. The ‘most creative’ group included the likes of BBDO, DDB, TBWA\, Crispin Porter + Bogusky, Goodby Silverstein & Partners and Wieden+Kennedy. The ‘less creative’ group included JWT, Ogilvy, Grey, Y&R and Publicis. The study found that the ‘most creative’ agencies won, on average, many more e!ectiveness awards, despite being smaller than the ‘less creative’ agencies. The ‘most creative’ agencies were shown to be over two and a half times more e!ective than the ‘less creative’ agencies.

E!ectiveness awards won per $US1B billed

Most Creative Agencies

Less Creative Agencies

13.7! 5.4!

SOURCE: Hurman, ‘The Case for Creativity’, 2011

More creative companies are more successful companies

An analysis of the Cannes Advertisers of the Year of the 2000’s reveals that each had experienced a record period of stock market growth at the time of receiving that award. While the Cannes Advertisers of the Year experienced, on average, 41% stock value growth in the year they won the award, the S&P500 experienced a fraction of that growth at 0.5%. Further analysis reveals that in each case, the companies had been going through a period of greater focus on creativity and innovation throughout their business, of which award winning advertising and stock market success were symptomatic.

SOURCE: Hurman, ‘The Case for Creativity’, 2011

Annual stock value growth of Cannes Advertisers of the Year 2000-2009 vs S&P500 annual average

Cannes Advertisers of the Year

S&P500

41%! 0.5%!

How does creativity work?

The many academic and industry studies of creativity in advertising not only prove a more creative approach to be a more e!ective one. They also give us insight into how creativity works – how creativity increases the e!ectiveness of advertising…


Creativity’s "rst e!ect is that it makes advertising more likely to stand out and be noticed. Five academic studies between 1991 and 2005 show that increased levels of creativity promote increased and more intense attention to advertising.

SOURCE: Pick, Sweeney & Clay, 1991; McQuarrie & Mick, 1992; Stewart & Furse, 2000; Pieters, Warlop & Wedel, 2002; Till & Baack, 2005.


Creativity’s second e!ect is that it makes advertising more likely to be remembered and recalled. In 2005, researchers at the University of South Carolina showed that creative advertising was signi"cantly (2 to 9 times) more likely to be recalled unprompted than advertising in general.

SOURCE: Till & Baack, ‘Recall & Persuasion: Does Creative Advertising Matter?’, 2005


Creativity’s third e!ect is that it makes advertising more likely to generate ‘fame’ and conversation. In 2010, researchers at the Institute of Practitioners in Advertising showed that creatively awarded advertising was twice as likely to generate strong ‘fame’ e!ects, i.e. online and o%ine conversation. In 2007 the same researchers had shown campaigns generating strong ‘fame’ e!ects to be the most e!ective of all campaigns.

SOURCE: Field, ‘The link between creativity and effectiveness’, 2010


Creativity’s fourth e!ect is that it makes advertising more persuasive. In 2009, researchers at the Universities of Indiana and Wisconsin-Milwaukee showed that creatively-awarded advertising triggers greater purchase intent, and that this was because it measurably increases open-mindedness and curiosity. Consumers let their defences down more for creative advertising, allowing themselves to be sold to more readily.

SOURCE: Yang & Smith, ‘Beyond Attention Effects: Modeling the Persuasive and Emotional Effects of Advertising Creativity’, 2009

Advertising creativity makes people think better of companies

In 2008, researchers at the Stockholm School of Economics discovered that more creative advertising had a far greater impact than less creative advertising on consumers’ positive perceptions of the company being advertised. Respondents shown creative advertising felt better about a company and its product than those shown less creative advertising for the same company.

“Smart Company”

More creative

E!ects of advertising creativity on broad company perceptions

SOURCE: Dahlén, Rosengren and Törn, ‘Advertising Creativity Matters’, 2008

Less creative

“High Quality”

More creative

Less creative

“Worth Purchasing”

More creative

Less creative

57%! 34%! 78%! 57%! 68%! 39%!

Summary: “Creativity is an advertiser’s best bet.”

Two decades of international research measurably demonstrate that: More creative advertising is more e!ective advertising More creative agencies are more e!ective agencies More creative companies are more successful companies Creativity works by making advertising more likely to stand out, more likely to be recalled, more likely to be talked about and more likely to persuade consumers Consumers think better of companies and the products they produce when those companies use more creative advertising For more, visit www.caseforcreativity.com

- McKinsey & Company, 2006