New Zealand agencies are up there with the best in the world. It's a market devoid of marketing formulas and one that consistently embraces creativity. Jessica Kennedy finds out about its robust culture of breaking the mould
For a country with a population just short of 4.5 million, New Zealand possesses some serious creative clout.
Last year, NZ's haul from the Cannes Lions Festival of Creativity reached 21 (just short of its 2010 record of 25) and Colenso BBDO Auckland was named the world's top creative agency in The Big Won 2012 report, which also ranked the country as the 10th most creative market globally.
Andy Fackrell, executive creative director of DDB Group New Zealand, says the "Super Bowl mentality" exists all year round in NZ as everyone competes to create the country's favourite ad.
"There is a certain peer pressure, everyone is aware of what everyone does," adds Fackrell who was born in the UK but grew up in Australia and NZ.
"You can't hide the work that you do in New Zealand, it's on in front of you the next day and you will see it a lot, so there is a lot of pride in work here."
While NZ may be scoring multiple tries creatively, its view across the ditch to Australia is apparently not as inspiring.
"Australia's quite an aggressive and confident country psychologically, but it's not very aggressive and confident in its communication," says Nick Garrett, managing director of Colenso BBDO. "Australia feels to me less and less confident creatively. The quality of work across Australia hasn't increased in the last couple of years. It's decreased. The best work is still world class but the depth underneath doesn't feel as strong."
With that in mind, what is it that drives New Zealand's creativity and sets it apart?
(The above views caused some discord, click here to read what one Aussie agency had to say in response.)
The NZ difference
For Fackrell, NZ's advertising is "much less commercial and in your face" than Australia, with a softer and more storytelling-style approach.
Paul Catmur, partner at independent agency Barnes, Catmur and Friends, also believes that while there is great work coming out of Australia, the overall standard in NZ is higher per capita.
"Aussie creatives often bemoan how easy we get it over here, and having worked in both markets they're probably right," he says. "Clients over here are, by the nature of their size, more compact and entrepreneurial. As individuals they are more concerned with actually growing their business as opposed to worrying about what their superiors' spouses will think."
Bigger is not always better, according to Dave Nash, creative director Sugar & Partners, who says working in a smaller market has distinct advantages: "We are dealing direct with the owner of the business as opposed to dealing with massive global brands where you may have to go through 17 rounds of sign offs to get something through.
"There is this ability to get work through the first time and means there is not time for good work to 'go off', as it were."
Fackrell agrees and says when working with global brands you're lucky to get something out within a year of conception, "but everything is out within a year in NZ, sometimes a month".
NZ's smaller scale means it is often used as a test market.
"A big global brand might let you do something experimental in New Zealand that they might not let you do in London or New York," explains Garrett. "If it works, great, if it doesn't, in the scheme of things it's not a major loss."
In addition to this, Fackrell believes creativity is held in good regard in NZ, with advertising viewed as a creative industry and less of a service provider. "It was always an exciting ideas-led place as opposed to marketing formula driven," he adds.
Combining this respect for creativity with a brighter economic outlook has convinced Nash that 2013 will be a big year for NZ agencies.
"When you see the agencies do their best work is when marketers and brand owners feel most confident," explains Nash.
Economic activity for the year ended December 2012 was up 2.5%, the highest annual GDP growth since March 2008. Economic growth is also forecast to increase to 2.9% in the year ending March 2014, with the Canterbury rebuild the main force behind the rise.
"There's a sense of buoyancy in New Zealand that wasn't there last year and the year before," says Garrett. "People seem to have got their swagger and confidence back."
However, Catmur says the "industry is still struggling through some fundamental shifts which means a bumpy ride for many".
Those shifts include the fragmented media landscape, which Catmur says is making it harder for agencies to "bludgeon consumers with media", and the lower margins agencies are expected to work with.
Ben Goodale, managing director of customer relationship management (CRM), loyalty, direct and mobile marketing agency JustOne, agrees, but adds: "Working out how to make money out of digital while still offering best practice leadership and an interesting trend and sub-trend on the movement of production and digital work either into agency or into client – this will run and run."
The indies' day
The challenges of the NZ market proved too difficult for some, with a number of high profile shops closing in the past year.
Droga5, Publicis Mojo and Naked are among those to have closed their doors. The Droga5 brand left the market after losing foundation client ASB, Naked announced closure plans in March and Publicis Mojo's doors were controversially closed four days before Christmas. Colenso's Garret branded that timing "inappropriate". "Mojo was a very badly managed and handled issue which left a lot of good people deserted," he says.
But for each of these closures there has been a new opening. Ex-Mojo Graeme Wills is behind The Joy Agency (see our Profile), Naked's Matt O'Sullivan has started Open and out of the ashes of Droga5 came The Collective.
But Wills believes Auckland is a "shrinking market rather than a growing one", which may mean more closures on the cards for 2013 and beyond.
And Catmur describes the agency landscape as "very fluid" with "more start ups than at any other time". But he says: "As margins continue to get squeezed it wouldn't surprise me to see further agency casualties".
According to Wills, further pressure has been applied to local agencies with Trans-Tasman businesses centralising their accounts in Australia.
But Nash of indie Sugar & Partners disagrees and points to Sugar & Partners recently reclaiming the NZ-focused account of Daikin from a Sydney-based agency.
"It is definitely the time for the independents," says Nash. "It is definitely time for a few of the independents to scale up a bit and figure out what their territory really is."
While indies may be focusing on marking their territory, ad agencies have also been busy claiming expertise in niche areas.
Success depends on the people, agency and structure but JustOne's Goodale says generalists playing specialists is risky for the industry.
"We saw last year some firms take up with general ad agencies on specialist needs that underlined a lack of appreciation of the value a specialist can bring," he says. "A frustration then is they form the view the discipline doesn't work because they find it hard, rather than because they appointed muppets rather than experts."
Drawn-out pitches where agencies are required to jump through hoops are not good for anyone.
"Over the last couple of years there have been some long drawn-out, and therefore notorious, pitches which have met with industry criticism," says Goodale, who believes recent pitches have been more straightforward.
"The Communication Agencies Association NZ is working on pitch guidelines and best practice to address this."
Last year, financial services played "pass the parcel or musical chairs" in NZ, where Fackrell says "there was a very big shift in the market for who's got who".
Among the changes were the ASB moving from Naked to Saatchi & Saatchi, the Bank of New Zealand banking on Colenso, and then Colenso's Westpac account shifting to DDB.
"The accounts that would be ripe for review and shifting this year would be retail, supermarket accounts and maybe the energy sector," Fackrell says. But overall, Fackrell says it is "quite a stable environment". He adds: "There are quite long-term client commitments here and clients aren't running around every year to bite the magic bullet."
Only time will tell if NZ agencies will have as successful a year on the international awards scene as 2012, but for Nash the biggest factor is confidence, which appears to be increasing.
"If the advertising industry is confident about itself then the marketing industry will be more confident about its results," he says. "I think that is where it once was and that's where the great work comes from."