Michael Heseltine once told a group of designers and clients that “effective design should be seen as an investment on which there is a real commercial rate of return”. This view is echoed in the Government’s White Paper on competitiveness, “Forging Ahead”, which says: “Good design can significantly add value to products, lead to growth in sales and enable the exploitation of new markets and the consolidation of existing ones.”
While it is heartening that the Government takes this view, such attitudes still have a long way to go before they filter down to the majority of marketing departments, many of which still see design as something of a Cinderella business. Leading consultancies confirm that although clients think of design as an essential ingredient in the marketing mix, the spend is often only between one and five per cent of the total budget.
Since the sums involved are smaller, design is often handled lower down the management chain than advertising. Many agencies also identify a tendency to use design as a training ground for the marketing department.
Certain design companies have in the past been their own worst enemies, turning out designs which did little to clarify brand values, earning the whole industry a bad name. But times have changed. “As a direct result of the recession, the industry has been forced to grow up and become more professional,” explains Roger Heathcote, managing director of Michael Peters.
“If advertising is a powerful tool, it is also tactical and short term. Design is more evolutionary and has long-term value,” says Heathcote. The Marmite jar and Heinz branding are just two examples of classic designs commanding instant consumer recognition. They have a heritage and values that have outlasted any comparable advertising.
But design can make its mark in the short term too. There are growing numbers of cases where point-of-sale impact is making a tangible difference to sales independently of advertising support. When Gossard lost the licence for the Wonderbra and saw it revert to Playtex, the company fought back with the launch of its own Ultrabra product. Gossard never intended to take on Playtex in the advertising stakes, says Ultrabra pack designer Wickens Tutt Southgate (WTS), especially in light of the “Hello Boys” posters which have attracted enormous media and consumer attention.
But WTS developed a powerful point-of-sale pack for Gossard, aiming for a sexy, rather than a tarty image and wit, rather than smut. According to Sandra Botterell, account director at WTS, while Playtex poured some 700,000 into advertising, Gossard spent about half of that on its own campaign. Arguably, the greater impact came from Gossard’s point-of-sale investment of some 70,000, says Botterell. Though from an admittedly small base, overall volumes increased by 58 per cent and export sales tripled.
Further proof of the strategic importance of design comes from the Design Effectiveness Awards which, for the past six years, have been providing the best documented evidence of design’s impact on brands, their positioning and ultimately on sales. This has helped to sharpen the industry’s image in the UK, but perhaps needs more of an international edge to fight the big advertising accounts on their own terms.
Part of the trouble with assessing the true impact of design, and so justifying a larger cut of the overall budget, is the way that different aspects of marketing integrate and blur the influence they have on the consumer. But most agencies can name brand redesigns which have been a success, even when unsupported by advertising.
Quaker’s Felix brand was on the point of being delisted in 1989, and was not able to afford advertising, says Tim Corvin, business development manager at Design Bridge Structure. An overhaul of the graphics provided the answer. “The immediate doubling of market share provided the critical mass not only to save the brand but reverse its fortunes,” says Corvin. In May this year, with a 25.2 per cent UK market share, the brand overtook Whiskas.
Similarly, after a redesign for Sara Lee’s Brylcreem brand, relaunched in April 1996, August sales of the men’s styling range were up 100 per cent on the same period in 1995, says Design Bridge. And this was before any advertising had broken.
Strategic thinking in design can also establish its own synergies with advertising. This was true of Michael Peters’ redesign of the Cornetto graphics in the wake of the distinctive “Just one Cornetto” campaign. “Unfortunately, the brand’s packaging did not live up to the advertising – it was dated and flat and needed infusing with the same sense of personality and vitality,” explains Michael Peters’ Heathcote. The answer was a pack which took images of Venice, its gondolas and architecture to reinforce the advertising.
Key agencies discern a maturing of the design industry, with the various players offering different strengths and specialisations, and many commanding the sort of respect previously reserved for advertising teams. “Design is a relatively young industry,” says Phil Gandy, planning director at Ziggurat. “It’s changing, and we are seeing a segmentation, with different companies finding different levels in the market.”
Gandy identifies two principal levels: the “execution only” agencies, which offer an excellent but limited service, and the more sophisticated consultancies taking a longer view. “These are looking for the big idea with the brand, looking to work with clients as early as possible in the process, helping to identify the opportunities and to work on the brief itself,” he says.
Understandably, the closer relationship with clients has always been enjoyed by those taking the larger share of the budget – the advertising agencies. But Ziggurat is among those design agencies noticing a shift away from this monopoly and towards multi-team working, with something closer to shared custodianship of the brand.
Andy Knowles, partner in Jones Knowles Ritchie (JKR), sees the remit of agencies like his own evolving into a wider consultancy role. “The value of design has crept up in the eyes of most marketing people, even if they are not really willing to pay more for it,” he says. Accountants, he explains, now have a tighter grip on marketing departments.
Knowles believes that clients’ post-recession nervousness and caution is reflected in the larger numbers of agencies that are brought in to pitch for a project. This means that more agencies put in the effort only to be disappointed, and refusal fees are still painfully low, he says.
The realisation on the part of many clients that design has a vital strategic contribution to make has coincided with a tendency to value relationships with specific agencies. Knowles points to JKR’s work for Whitbread as an example of this. Here, mutual trust and respect have produced the best results, most recently for Wild Brew, a guarana-based drink aimed at younger consumers and the club scene.
With products such as these, fashions change quickly and long research and creative processes can constitute a missed opportunity. But an agency which demonstrates that it can respond with an instinctive understanding of the market does itself and the design industry a service. This is especially important given how elusive this younger market is proving to a great many advertising agencies.
Such input from designers is having a direct impact on the client’s bottom line in more ways than one. “After all this time, Whitbread is certainly not paying us more than previously,” admits Knowles. “But it is paying less on research than some other people who are more nervous. There’s a lot of respect for us and our opinions.”
According to Knowles, while a long-term relationship between client and agency benefits both parties, formalising it with a retainer can be counter-productive. In JKR’s case, the offer of a retainer from Whitbread was turned down.
But for others, this is the right answer. Graphique has just been appointed as the retained agency for Lever Brothers fabric conditioners throughout Europe.
“The planning and strategic positioning outlined in Graphique’s proposals made it the natural choice,” says a spokeswoman at Lever Europe. This is, says the agency, the first time that the multinational has made such an appointment.
A long-term client-agency relationship does not lead to a bigger cut of the budget however much it may indicate that the agency is appreciated as a source of strate gic thinking rather than just as an ad hoc supplier. So for some agencies, the solution has been to redefine their own product positioning.
Grey Matter calls itself a “creative services consultancy specialising in brand and product develop- ment”. The decision to move away from the competitive arena of “tactical design” to a more strategic role was a conscious one. Programmes are long-term, says the consultancy, and fee structures up to half as high again.
According to Grey Matter’s creative director, Sean O’Flynn, a product must be able to self-sell with or without ad support.
“People are paying less to ad agencies and more for planning, media buying and creative services, which inject more value into the brand,” explains O’Flynn. Grey Matter recently advised a client to ditch a proposed ad campaign and plough the savings back into research and development and new product development. “Advertising agencies are getting fidgety,” he says.
If more design agencies upgrade to this consultant role, that fidget may soon become a tic.