“The creative industries effect” / Gerin Trautenberger

Gerin Trautenberger, Art und Creative Director

Creative industries as more than the sum of their parts

 – Gerin Trautenberger

The collaboration between traditional companies and companies from the creative industries leads to a large number of crossover effects from which both sides benefit. In recent years, a series of increasingly dense networks have been created between these different areas in Austria, which also make an essential contribution towards enabling the local economy to remain competitive overall. Therefore, it is not just the creatives themselves who benefit from the “creative industries effect”.

There’s hardly any area that has become more important in recent years as an economic and competitive entity in Europe than the creative industries. For the Austrian economy, the creative industries are an engine for growth and innovation, and are a significant factor for success. The potential for innovation is very high within the creative industries themselves, but it also acts as a catalyst for innovative products and services provided by other companies, contributing to their added value and growth. These crossover effects of the creative industries are the key to renewal and change in the traditional economy and local sectors. Regional innovation systems and business locations can themselves benefit from this creative industries effect.

The creative industries as the avant-garde of the economy

Since 2003, the Kreativwirtschaft Austria (“KAT”) association has been following the development of the local creative industries with five reports about them. These reports illustrate how the creative industries are a pioneer for different developments in society as a whole, and how they themselves have developed in a positive way over the years. In the interim, one in ten Austrian companies belongs to the creative industries segment. With over 140,000 employees in the creative industries, these 40,000 or so companies produce goods and services worth over 20 billion euros every year. This corresponds to 4% added value for all Austrian companies, and makes the creative industries an important cornerstone for the Austrian economy. It is not only in terms of economic performance that the creative industries act as a pacemaker for other sectors. They are also a pioneering force when it comes to digitalisation. They stand out for their broad use of the latest technologies and methods, as well as the digitalisation of many processes in their daily work. With these experiences, the creative industries are paving the way and fuelling the digitalisation of added value chains, which is also described as the fourth industrial revolution, or “Industry 4.0”.The current report published by Kreativwirtschaft Austria shows that 20% of the demand for creative services in the economy is generated either directly or indirectly by the public sector. This corresponds to a turnover of around 3.4 billion euros, which comes either directly from the state itself or via sub-commissions from public contractors. Creative companies help the public sector in developing new customer-oriented services and public services. This clearly illustrates the level of importance of the public sector as a client – a fact that is frequently overlooked.

Creative industry networks- small but perfectly formed

One in ten companies in Austria belong to the creative industries. When only the service sector is taken into account, the figure even goes up to one in eight. The creative industries consist of architects, weavers, designers and acquisitive companies and self-employed individuals. The creative industries include music, books and artistic activities, radio and TV, software and games, publishers and video and film. The three largest creative branches, music, books and artistic activities (27% of all operations), software and games (24%) and advertising (23%) have the most employees, the largest turnover and the highest added value. Two-thirds of the at least 40,000 local creative companies have no employees, but are one-person enterprises (OPEs). To compare: in the overall economy, only about one in three companies consists of a single person. This smallness of scale and manageable size is what gives power to the creative industries: in times of crisis, creative companies can react more quickly to changes in the market, and are more resilient in their response to structural changes. These small structures within the creative industries cooperate intensively with each other. This requires coordination, openness and collaboration when working with other creative companies and clients. For this reason, working together forms the core of the creative industries; collaborative and cooperative activities take the form of business partnerships and agency models or fall under a common label. When local creative entrepreneurs purchase services, they do so primarily from their own sector. 40% of the overall turnover of creative companies is generated by other companies from the creative industries.

The regional factor

Finally, creative companies have not only proven their ability to survive in times of crisis; they also make an important contribution to positioning and developing cities, communities and regions. The creative industries are an important interface between innovation, culture, the economy and society, which ensure that an interplay is possible between technology, education, work spaces, culture and the economy. With their products and services, the creative industries support other sectors and regions, in order to remain competitive, better market themselves and create new, innovative business processes. Not only that: creatives are usually regarded as positive visionaries. This spillover effect in the sector also ensures that at the same time, social and cultural policy factors are impacted. Regions are strengthened through the new impulses coming from the sector. With fresh ideas and intelligent positioning, structural change can also be better managed.

Crossover effects of the creative industries

The structure, conditions and peculiarities of the creative industries lead to crossover effects for society and the economy. These crossovers are found in collaboration with external experts and specialists, as well as within the creative industries themselves. Through these new forms of collaboration and the use of new methods and applications, new, innovative solutions are developed. In this context, new perspectives and new combinations emerge in the collaboration between individual sectors, branches and experts. Innovations – new ideas, methods and approaches – are developed, tried out and refined in the creative industries, and can be adopted by traditional companies in transfer processes. Further evidence of how the creative industries can benefit companies is provided by the competition for the best creative industries story organised by KAT. KAT collects successful, interesting stories that demonstrate the impact of crossover effects, and how creatives, together with their clients from the business world, can turn simple products into wonderful experiences, or indeed, turn very complicated experiences into simple items in an ingenious way.

Kat – “Kreativwirtschaft austria”

Kreativwirtschaft Austria (“Creative economy Austria”) offers a wide range of services to support the economic success of creatives and their cross-sector networking. Kreativwirtschaft Austria, as part of the Chamber of Commerce, represents the interests of the creative industries in Austria and in the European Union, and works to improve awareness of creative industry-based services.

The author:
Gerin Trautenberger has been working as an Art and Creative Director for various companies in Europe and the US since 1992. In 2005, he founded Microgiants GmbH for product and service design, and is a specialist in design management and consultancy. From 2011 to 2013, he was a member of the European Design Innovation Initiative, where he provided consultation to the European Commission on innovation and design policy. Since June 2013, Gerin Trautenberger has been Chairman of Kreativwirtschaft Austria (KAT) in the Austrian Chamber of Commerce.

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