Scottish creative agencies slam council’s Marketing Edinburgh 89% budget 'rug-pull'

The This is Edinburgh campaign reportedly generated 50/1 ROI

The Scottish creative sector has banded together against a severe 89% budget cut facing city promo body, Marketing Edinburgh. Its chief executive John Donnelly is building support to counter a two-year cost-cutting proposal that threatens the “sustainable future” of the capital’s marketing machine.

This comes as Edinburgh faces unprecedented public sector cuts and is looking to save as much as £41m by 19/20. Marketing Edinburgh, which was founded in 2011, will be trimmed to save less than a fortieth of the deficit.

Marketing Edinburgh faces deep cuts to its current £890,000 annual allocation. It will be reduced by 89% over the next two years, first by £567,000 in 2019, and then £223,000 in 2020. The group's ability to operate the city’s digital channels, promotions, events and partnerships, will be severely limited under current plans. It will also have an impact on local creative industries.

A letter, currently signed by 27 agencies, including Bright Signals, Republic of Media, Wire, Whitespace and Weber Shandwick, derided the “rug-pull” cuts and added that they “defy reasonable logic”. It also leaned into a wider trend of cutting from marketing budgets when times are tough.

It read: “We must find a way to get our colleagues and clients to lean in towards marketing when things get difficult, rather than away. What else better cuts through the noise, than great promotion? What else better persuades people – talent, businesses, visitors, events and productions – to notice, to engage and, ultimately, to spend?”

As a publicly-funded body, there is a heightened need to prove ad effectiveness. It added: “We stand together in support of Marketing Edinburgh as they try to crack the industry’s hardest brief; make sure the value of marketing is fully recognised, across boards, across budgets and for the benefit of all.”

Donnelly said that Edinburgh would be the only major city in the developed world without a destination marketing management organisation. He said that business tourism delivers £72m to business tourism and £16m to the film economy in addition to creating £99 for the city’s economy for every pound it spent in 2017/18,

The Scotsman reports that Edinburgh’s tourism industry is worth £1.5bn with 4.26 million people estimated to visit the city each year. The title reached out to the council which admitted it had to make an “unprecedented number of savings”. It added that the need to create a “balanced budget which promotes inclusivity and protects the most vulnerable in society… means we have to make tough choices.”

Donnelly pointed to the European Cities Marketing annual survey which outlined that the society already suffered from the lowest funding in Europe comparatively. The solution, he said, is to slow the rate of the cuts so the organisation can embrace a model that will enable it to better embrace private funding.

This allows it to create work like the This is Edinburgh (which he said delivered 50m back into the city from a 1m pound spend) and the forward-facing Edinburgh 2050 campaign.

He also wanted to underline that the organisation is not tooled to just attract tourists to the castle-city. “We don't spend much on tourism marketing, Amsterdam hasn't spent a dollar on an international campaign in about 10 years. The reputation of cities like Amsterdam and Edinburgh and Copenhagen means they don't need to, we are here to manage the city now. Our success has got us to this position. I think that is what the city genuinely needs.”

Currently, 250 entities invest hundreds of thousands of pounds into the group, this will have to increase to rebalance the budget.

Donnelly said: “We will come back with a counterproposal on a different level of funding and the strategy and tactics around that are to ensure we have a sustainable future. We've met and explained our thoughts on the cuts on councillors, MSPs and stakeholders, and the domestic and international support we are getting is significant.

“Housing social care and housing sit above us in terms of priorities, but the cuts are too deep and too quick, our counterproposal will allow us the time to find a new type of funding model and investment either from the private sector or other potential agencies.”

He concluded: “This will provide opportunities for the private sector.”

Pam Scobbie, creative director at Wire, reflected on the implications of the cuts. “There’s a definite need to shout more loudly about the value of marketing, especially when budget cuts bite. Regardless of changing finances or circumstances, it’s a crucial part of any plan for success, so it’s disappointing when that’s not recognised. But it’s encouraging that so many agencies and individuals are backing Marketing Edinburgh – as an industry-wide issue we need to stick together to tackle it properly”

Read the full letter below.

The role of marketing is undervalued and misunderstood – it’s time to change that

“We need to cut budgets”. Five little words sure to strike fear in the heart of any marketeer. Because too often our work is top of the chopping pile, leaving us anxiously trying to prove that what we do matters. Trying to persuade those cynics who still view marketing as a tactical rather than strategic activity. Arguing that – when done well - it isn’t something fuzzy, intangible or easily dispensed with, but a driver of real value creation.

So, spare a thought for Marketing Edinburgh – the body that promotes Scotland’s Capital – who just days ago found out that the city of Edinburgh Council intends to almost immediately remove 64% of its budget from the organisation, rising to 89% in year two. The proposal - if passed - will go live in a little over eight weeks, leaving Edinburgh as the only major city in the developed world without a Destination Marketing Management Organisation.

This is despite Marketing Edinburgh having demonstrated that they return £99 to the local economy for every one pound spent by them. It ignores their central role in the £74M business tourism and £16M film promotion economies. And it undermines the work they do to attract investment from the private sector, which they completely reinvest in city campaigns.

They also run the city’s consumer digital channels, unite city stakeholders, facilitate thousands of conventions, support hundreds of film and TV productions...the list goes on.

But all this seemingly doesn’t matter to the Council, who want to pull the rug with no obvious contingency or regard for the damage that will be done.

Their decision seems to defy reasonable logic, but it should give us all pause for thought, highlighting a common – and growing – problem in our industry. Consumers have a world of choice, cluttered feeds and a rapidly diminishing attention span. In the case of Marketing Edinburgh, visitors can easily fly to countless destinations clambering to be chosen; cities throughout the world have woken up to how lucrative the convention and student markets are; business owners can easily find cheap labour overseas. Never has it been more competitive for those who seek to be noticed.

Which is why we must find a way to get our colleagues and clients to lean in towards marketing when things get difficult, rather than away. What else better cuts through the noise, than great promotion? What else better persuades people – talent, businesses, visitors, events and productions – to notice, to engage and, ultimately, to spend?

It’s simply wrong to think that Edinburgh doesn’t need this type of support; that somehow, the quality of its product means it’s above all that. After all, it’s been proven that FTSE companies perform significantly better when they have a marketing-experienced director on their board. Why should a city be any different?

The modern world of marketing demands that - whether you are a place, or a consumer brand - you need to stand out, or stand down…do we really expect the latter from Scotland’s capital? Or any organisation focused on success?

And so we stand together in support of Marketing Edinburgh as they try to crack the industry’s hardest brief; make sure the value of marketing is fully recognised, across boards, across budgets and for the benefit of all.

Signed by:

Always Be Content, Bright Signals, The Corner Shop, East West, Guy & Co, Hamlin Daniels, The Lane, Punk, Red Facilities, Republic of Media, Storm ID, Studio LR, The Union, Tincan, Union Direct, Weber Shandwick, Whitespace, WIRE, Graeme Atha (Marketing Society Scotland), Gavin Bryce (Day Six Films), John Denholm (Denholm Associated), Mick Doran (Sainsbury’s Bank), Mike Donoghue, Richy Lamb (Owned & Operated), Lewis Notorangelo (Immagine Films) David Reid (Because Brands Matter)

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