Brands In Britain 2024: Why Marketing needs to fill the growth void

I work in advertising. I am paid to be optimistic.

Because the future belongs to those people and brands that are excited about that future and their role in it. That see the best in the world and are determined to bring their best to the world.

But sometimes there are prizes for striking a note of realism. For staring hard at the problems and challenges that we face in order that we overcome them. Because as every strategist knows the most important quality of the problem solver is knowing that you have a problem that needs solving.

And the UK has many problems.

Of course, contextual challenges are a constant in business. But there is a difference between stiff headwinds and serious existential threats. And that’s where we are now.

Politically there is some certainty. The country has already decided the Tories are done and there is now no credible path to victory for Sunak. So, the election will be in November, Labour will win, probably with a working majority. And until then it will continue to be a shit-show as Sunak’s government self-immolates.

But as Clinton was constantly reminded throughout the 1992 presidential campaign, it’s the ‘economy stupid’.

We can all play the inflation and interest rate guessing game. The smart money is on inflation nearing its 2 per cent target this year leading to a reduction in interest rates. This is all good news, though those prices rises that ate everyone’s income are not going anywhere.

But this is not the full picture and that’s what worries me.

We are a no growth economy. And we have been since the financial crisis of 2008.

Our headline growth is non-existent and our productivity as a nation is catastrophic. Contrast our near recession with growth of around 5 per cent in the US.

Lack of growth destroys our tax base and forces taxes up to cling onto the bare minimum of services. This historically high level of taxation hits the middle classes hard.

Add to that burden the insane cost of childcare, failing public services, higher mortgage repayments and weakening savings and you take the heart and life from the middle classes. They are being hollowed out in front of our eyes.

Our ‘What the Fuck is going on?’ research repeatedly reports on the sacrifices that these people are facing, even down to making the choice between heating or holidays. Spoiler alert, there is no way they are staying at home this summer.

Why all the concern about the middle classes?

Well to paraphrase David Ogilvy, the middle classes are not an anachronism they are your customers. Most brands depend on the middle classes for both value and volume.

That’s why every marketer and business leader in the UK should be worried. As the economist Gary Stevenson says ‘this is not something that is bad and gets better, this is something that’s bad and gets worse’.

Because who has the formula to get the UK back into growth?

And not just growth in London and the Southeast, we need growth everywhere, for as a nation we grow together or not at all.

Maybe Labour has the answer but there are big questions about this for both Starmer and Reeves that are politically difficult.

Growth needs immigration but no one fancies defending high levels of net migration. Growth needs investment in infrastructure and green technology but no one wants to talk about borrowing. Growth needs access to the single market but Europe is still toxic. And growth needs the nation’s wealth to be recirculated, yet the Labour leadership won’t engage with wealth taxation – even simply equalising income and capital gains tax.

So, we can’t say with any confidence that there is a light at the end of this 16-year-long tunnel. And that’s incredibly bad for business.

However, this may have a silver lining for marketing. If there is no growth available from economic expansion and the fake growth you created with price increases has run out of road, then marketing has to step up.

Marketing needs to find growth within a stagnant economy, by ensuring that the business can do more for people, by competing for a greater share of peoples’ lives and not just a greater share of static markets.

And that calls for what I think of as brand-led business transformation, something only marketers and their agencies have any hope of delivering to an organisation.

And perhaps that offers some optimism, that this is the time when our skills are really put to the test and our brands must be instrumental and not ornamental to for the life of the business.

Richard Huntington is chief strategy officer at Saatchi & Saatchi