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Investment in creativity is key for businesses looking to better the bottom line

New data released today at Sydney’s SXSW by creative transformation company, WPP shines a spotlight on the importance of a brand’s continued ability to invest in creativity. Releasing the WPP Creative Capital Index, the tool allows brands to analyse the value of its creative output to see how it measures up, finding that companies with a strong Creative Capital deliver on average a 2x greater shareholder return than those without.

Creative Capital Index demonstrates the financial impact creativity can have on a brand in relation to financial performance, stock market returns and consumer advocacy. The ASX200 saw a 16 per cent growth over five years compared to a 163 per cent return on the top Creative Capital brands in Australia. The value of a $10,000 AUD investment after five years in the top Creative Capital brands in Australia is 2.3x the ASX200. Brands with higher Creative Capital drive 1.4x consumer usage compared to all other brands.

In addition, brands with higher Creative Capital provide 1.2x increase in consumer advocacy, 1.4x more brand love and 1.1x greater pricing power.

The Creative Capital Index, a global WPP tool, launched locally in Australia at the WPP House @ SXSW Sydney 2023. The tool will be progressively rolled out to other WPP markets across the globe over the coming weeks and months. 

The Creative Capital Index has been designed by WPP’s BAV® – one of the largest, most comprehensive brand analytics platforms in the world – containing 16 billion+ data points, spanning 52 countries and 63,000 brands, both big and small. Harnessing over 30 years of BAV® brand equity data across the globe, the Creative Capital Index evaluates and analyses the data to understand first a brand’s Influence and second a brand’s Creativity through the eyes of the consumer. 

By analysing the perceptions of Influence and Creativity across many thousands of brands in culture, among millions of people around the planet, WPP can benchmark the relative level of Influence and Creativity that a brand enjoys. Once those two benchmarks are determined, the brand can then be assessed on performance in relation to the marketplace. 

Commenting on the unique offering, WPP’s Chief Strategy Officer for Australia and New Zealand, Katie Rigg-Smith says, “The WPP Creative Capital Index provides our teams with data-driven instruments and tools they can harness to make more informed insights about their client’s brand, delivering superior strategic output. In doing so, we enable our clients’ brands via their creativity investments to outperform the Australian marketplace on financial metrics.”

Different levels of Creative Capital can vary depending from sector to sector. While some sectors like Food and Household Products may have less creativity than others like Computer/Electronics and Autos, WPP’s Creative Capital Index highlights that creative disruption can happen with brands in any category, paving a way for brands to reinvent what creativity means in the categories where creativity is less prevalent and under leveraged.

Michael Sussman, PhD, Chief Product Officer of BAV, says “The WPP Creative Capital Index proves that creativity is the top driver of income growth, outpacing brand fundamentals including trust, innovation, purpose and status. Creative brands drive incrementally greater consumer interest, positive attitudes, and proactive and engaging consumer behaviour. The WPP Creative Capital Index ensures marketers across the globe now have the proof they need to invest in their brands – and even more so during periods of economic uncertainty.”

The algorithms and methodology for the proprietary metrics driving the Creative Capital Index are based on survey research of a globally representative sample of consumers who rate brands in their local market on key image, equity and advocacy metrics from Reputation to Innovation to Popularity. What’s the Creative Capital formula? Influence + Creativity = Creative Capital.

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