adam&eveDDB boss talks of Brexit resilience despite lost contracts
Murphy, centre right
adam&eveDDB’s founding partner, James Murphy, has revealed his business lost £3m in contracts following the decision to leave the EU in June.
However, Murphy, a remainer, said the losses were short-lived and that the ad industry must now pursue its future outside the EU with “positivity” and “vigour” if it is to remain a global leader.
“The Brexit vote has had a tangible impact [on the advertising business] and the dynamics are very interesting, but unresolved,” Murphy said at the Ad Association’s annual LEAD conference on Thursday (26 January).
“The Friday the vote came we got a call from a large North American client cancelling a contract…the following Wednesday a European client cancelled a contract because they wanted a more local solution. That was about £3 million of income that went in one week.”
A recent survey produced by think-tank Credos on behalf of the Ad Association also revealed that more than a fifth of companies operating in the UK advertising sector have already lost business or contracts as a result of the vote to leave the EU.
Just 23% said they believe Brexit offers opportunities for international growth – with potential advantages listed including a lower exchange rate, better trading outside of the EU and fewer EU regulations.
The findings are some of the first to provide tangible evidence of the impact Brexit is having on adland – and follow Zenith’s latest advertising forecast, which predicts UK adspend will slow to 5% in 2016 – down from 9.2% in 2015 – with 3-4% growth expected through to 2019.
However, despite losing business, Murphy said it took very little time after the June referendum before it was back to “business as usual”, but that sentiment amongst clients is “brittle and quite easily affected”.
Last week talks collapsed between adam&eveDDB and a European client over the launch of a new European hub to be based in London. Following Prime Minister Theresa May’s speech outlining the Government’s objectives for negotiations – including confirmation the UK would leave the Single Market – the unnamed client ditched the idea in favour of a more “diffuse” European structure, which will limit the number of London-based jobs.
Murphy, who oversees a business with more than 700 staff and has worked with clients including John Lewis, Google, Foster’s and YouTube, concluded that the ad industry’s response to Brexit must now be to pursue the future with “positivity” and “vigour” to maintain the UK’s position as a global power-house.
“The UK ad industry has, frankly, been able to run rampant across Europe for probably two or three decades becuase we’re simply very, very good at what we do,” he said.
“It’s a bit like pop music: we’re just better than the people on the continent at it.”
Elsewhere at the LEAD conference, the Secretary of State for Culture, Media and Sport, Karen Bradley MP, delivered a political keynote reassuring advertisers that the Government fully recognises the important contributions media and advertising makes to the UK’s economy.
“UK advertising is something we can all be very proud of,” Bradley said. “Yet more than that, it is one of the industries that makes me most optimistic about this country’s progress.”