The advertising industry must promote the value it offers to the boardroom and the public, Moray MacLennan told the industry in his first speech as IPA president. The M&C Saatchi chief executive told the annual members lunch at Cafe Royale in London that the focus of his two -year term would be an outward facing one and that one of his main targets would be CEOs and finance directors, and those who influence them.

MacLennan said: "The objective is to promote the value of advertising in the boardroom so that we establish ourselves as central to the success of brands, companies and the UK economy."

He said the industry needed to remind those running UK Plc that advertising could help to boost the bottom line significantly, as boardrooms increasingly focused on organic growth and intangible assets. He pointed to the statistics that for every £1 spent on advertising, £5 was made in sales, generating £2 in profit.

"Advertisings concern is exclusively with these two factors, intangible assets and organic growth, and is therefore fundamental to the value chain," he said.

MacLennan that integral to this process was the repositioning of how advertising was perceived by the boardroom audience. It had, he said, to move away from being seen as something that happens at the end of the process and at the "fluffier" end of the spectrum.

"In order to ensure it's viewed as central and integral in the engine room of value creation, we need to reposition it as being at the creative end of commerce. We must show how creativity is inextricably linked to business success," he said.

However, he did not underestimate the challenge that the ad industry faced and cited the failure of many companies to properly get to grips and manage intangible assets as why it would be an uphill struggle.

"This failure to get to grips with managing intangible value creation is a root cause of why advertising's contribution is so poorly understood in the boardroom and the reason why there is still significant resistance to rewarding agencies related to the value they create," he said.

As well as the boardroom, a key challenge in a channel-hopping and ad-skipping world, is to engage with the public and MacLennan spoke about how it was necessary to show how advertising has a positive, rather than negative, role to play in life. He underscored the argument that advertising brings lower prices and better products.

"If people think that their lives would be better without advertising we should aim to do at least one thing -- make them realise it would be worse. Ultimately, advertising delivers lower process and better products. It also provides information which gives people power -- power to accept or reject the choice it provides."

A third strut to MacLennan's marketing plan for the IPA will see the industry body remind the Treasury of the value advertising to the UK economy.

MacLennan succeeded David Pattison, the former chief executive of PHD who has just completed his two years in the job.

(Source: Media Asia)