As the future of Brexit looks ever more uncertain whichever side of the fence you sit, marketers are faced with the challenge of preparing their businesses for challenges on all fronts. From staffing to exporting, marketing logistics to data protection, everything that was once certain seems entirely up in the air.
Conscious that they need to maintain commercial momentum without falling foul of regulation or incurring unforeseen cost or delay, what exactly can marketers do to weather this unprecedented period of uncertainty, especially if there is ultimately no deal?
The Advertising Association’s CEO, Stephen Woodford, acknowledges that it’s a difficult time for marketers. “They’re in an extraordinary position. We are in such uncharted waters. We don’t know if there will be a few days’ grace [after the current Brexit deadline of 31 October] and we can either hope that there is a deal or that, if there is no deal, sanity prevails and a series of mini deals will happen.”
Retaining and attracting talent
The irony of these pre-Brexit times is that the concept of ‘settled status’ for EU citizens in the UK feels anything but. It’s important to realise that, of the handful of stories that grab the headlines, the reality of staying in the UK to live and work may well end up being little more than an additional administrative hurdle for most.
The UK’s EU Settlement Scheme enables EEA and Swiss citizens resident in the UK, and their family members, to obtain the status they will require in order to live and work in the UK after Brexit.
“At this point, we’re not clear on what immigration policy will be, but it looks like it will be an Australian points-style system which is skills-based and business-friendly. The UK has already attracted a large number of the EU’s brightest and best in terms of data and technology and we are in the position of having a strong jobs market,” Woodford insists.
He adds that two critical and controversial policies have been changed which may pave the way to smoother employment opportunities post-Brexit. “What has been dropped is the obsession of the 100,000 net migration figure, and the other big thing is allowing people to stay on for two years after graduation from university. Why not have the benefit of that education in our labour force?”
Woodford is also hopeful that, in a post-Brexit world, the Government will revise its £30,000 salary baseline, noting that many junior marketers would struggle to reach that level. “International people coming to the UK are not displacing jobs for British people. We have a shortage of data and technology skills so demand is ahead of supply.”
“Hiring European talent is just about to get harder but London will always be a strong pull for good talent,” insists Laurence Parkes, CEO of Rufus Leonard. “The UK Government is also very aware of the importance of a thriving domestic creative and technology-oriented SME scene, so we expect it to try and reduce the friction as much as possible.”
“The only other thing to say is that, even in a no-deal situation, our current EU talent have until the end of next year to apply for the EU Settlement Scheme and, as skilled workers, we are confident they will not have a problem,” he adds.
Others are not so sanguine. “In a company where 60% of the employees are European and not British, we have concerns over what will happen in terms of their working rights in the future,” warns the CEO of maternity wear brand Seraphine, Cecile Reynaud.
Even in a no-deal situation, our current EU talent have until the end of next year to apply for the EU Settlement Scheme.
Laurence Parkes, Rufus Leonard
Seraphine has grown into an international success story with an annual turnover of £22m. Its multilingual and multicultural staff are a business benefit in expanding international markets and their departure would only benefit competitive EU brands.
“The EU Settlement Scheme is helping but we are seeing much less EU immigration into the UK already and it’s creating a difficult job market. There is definitely a shortage of young staff and skills which creates salary inflation.” Reynaud notes that this will just be one of a number of costs – including a potentially weaker pound and export taxes – that could cause significant trouble for her business.
While it can be hard to focus on long-term projects when the near-term seems so all-consuming, Parkes states that Rufus Leonard have irons in the fire to ensure talent continuity and development.
“It’s always worth looking further afield for talent,” Parkes advises, “which is why we are beginning to work with universities to create Knowledge Transfer Partnerships (KTPs) to get financial and recruitment support to bring talented researchers into the business.
Aston Martin Lagonda’s vice-president and chief marketing officer, Simon Sproule, believes that, despite immigration changes, trying to avoid sourcing staff from Europe is a non-starter. “We have a global marcoms function so we need a multi-language capability. It’s the same for our agency partners.
“We will continue to look for the best global talent and find ways to hire, retain and promote people from around the world. We have no intention of scaling that down. It’s up to us to create career paths that are attractive enough for people to relocate. For our current EU members, we’re standing behind them and giving them whatever support they need. We’re a global team.”
Businesses worried about attracting staff, regardless of nationality, should look around to explore the options out there that support their talent development. Parkes reveals: “We are talking to one university which has started providing an artificial intelligence (AI) course this term. We are planning to apply for a KTP jointly which will place a research student in our business to work over one to two years on a project.
“The Government pays for a large portion of the cost and we get a say in the recruitment process. It seems like a win-win. We expect it to take less than six months from the start to get someone into the business – not much longer than the usual recruitment process.”
Companies worried about how to manage their current staffing challenges, or work with existing employees of EU origin can refer to the latest legal advice from Pinsent Masons, which suggests:
- Identifying people employed under the EU’s free movement principle
- Advising they remain eligible for the Settlement Scheme until 31 December 2020
- Advising them to apply immediately, regardless of anticipated Brexit outcome
- Supporting British nationals working in EU
- Reviewing and possibly accelerating EU appointments (greater restrictions may apply to recruiting EEA nationals from 1 November 2019).
Data capture and use
When it comes to data regulation, GDPR wasn’t the end of the story within the EU and, should the UK depart but businesses wish to exchange data with EU companies, there are upcoming challenges to consider.
Steven Roberts, head of marketing at Griffith College, Dublin explains: “A no-deal Brexit is definitely the worst outcome at present. Britain would immediately acquire ‘third country’ status under GDPR and would then have to seek an adequacy decision from the EU. While such decisions are in place with a number of countries, Japan being a recent example, data privacy experts estimate the process could take up to 18 months.”
Woodford acknowledges that the recognition of data adequacy in the event of no deal may take some time but again, hopes that common sense takes charge: “A large amount of EU data comes through the UK and we would hope that in the end, again, sanity prevails.”
Acquiring adequacy decisions for existing compliance is one thing, future changes are another as Roberts points out: “With a proposed EU ePrivacy Regulation still in the pipeline, and increasing concerns on the part of supervisory authorities regarding the industry’s ad tech model, the pace of change is unlikely to slow in the next few years.
“The EU is currently rolling out mechanisms as part of GDPR. They include codes of conduct and certification schemes. However, both are still under development and are not an immediate option for businesses to consider.”
Aston Martin’s Sproule thinks data is literally the least of his worries right now. “Like every company, two years ago we went through a lot of work to manage our GDPR compliance. But, today we’ve ended up with a much higher quality database and our ability to talk to prospects has actually improved.
“I don’t see any reason why that should change,” he adds. “What we learned through GDPR will help us in the future. I have every interest in having a quality database.”
Griffith College’s Roberts outlines the steps companies can take now that can help them weather the uncertainty. “Standard contractual clauses present one of the simplest and most common solutions. These are model data protection clauses approved by the EU. They allow for the free flow of personal data out of the EEA when embedded in a legally binding contract.
“Also, binding corporate rules (BCRs) might be necessary. These are legally binding and enforceable internal rules and policies for data transfers within multinational companies. However, this will not be a viable option for marketers at the vast majority of small and medium-sized firms, most of whom will not have a significant international presence.”
The marketing supply chain
While the question of trade has dominated the headlines, companies involved in exporting to the EU and beyond are well-versed in the concept of transporting goods and services across borders. That doesn’t mean it will be easy to make a simple switch, however.
“Of the aspects of Brexit and all the unknown unknowns, this is the area where we have the greatest concern,” Sproule complains. “We’re used to shipping cars to China and other far-flung destinations for product placement or film shots and yes, we fill out a lot of carnets [which allow unrestricted movement of specified temporary exports across borders] But the biggest pinch point for us is the Channel.”
He explains: “We have a constant flow of goods and services. If you’re building a motor show stand or have to transport things that can’t be carried in planes, you’re on a high state of alert as to how things are going to work in a post-Brexit world.”
Most marketers involved in a cross-border supply chain need to consider even some of the smallest items if they’re for commercial use and for temporary export, such as:
- Commercial samples to show at trade fairs or sales meetings
- Publicity materials
- Recorded film and audio
- Professional equipment you need for work like laptops, cameras or sound equipment
- Goods for educational, scientific or cultural purposes
- Personal effects and sporting goods
However, when goods are sizeable, transportation choice is limited and adds another layer of complexity beyond cost. Sproule points out that Aston Martin Lagonda is very involved with the Red Bull Formula One team, for which it supplies design and production, and mobility is key. There is simply no time to be hanging about in Operation Stack on the M20 when vehicles, teams and equipment need to be in San Marino or Spa.
“We have the benefit of a sophisticated logistics operation that has been studying this for the last three years. If Brexit starts to slow things down, it’s going to have a real impact. We have to showcase our product in export markets and if we find that difficult, it raises questions about whether or not we can promote our products overseas.”
However, he adds that he has high hopes that the Government will step in to support its exporting community, adding: “I’m quite sure no-one on the Government side wants to stop any exporter showcasing their products overseas and that includes mainland Europe.
Seraphine’s Reynaud acknowledges that taxes on marketing materials will have an impact, but that this is small fry compared to the uncertainty over actually doing business in the new Brexit reality. “Like many brands who export, we do engage in a lot of trade shows and that becomes complicated because it increases our base cost, but this is a much smaller problem for businesses than the bigger picture, which is having to pay tax on each parcel sold to an EU customer.”
The Advertising Association’s Stephen Woodford is all too aware of the problems marketers face, and his advice is simple though no less pragmatic for it: “It’s not too late to make preparations, and the old adage of prepare for the worst and hope for the best applies. Simple preparedness is very important.”