It Is Time For Us To Invest Beyond The Brief – Dr. Rotimi Olaniyan
Dr. Rotimi Olaniyan is the EXMAN President and the Managing Director of ADVANTAGE. In this interview with Brand Communicator team, he bares his mind on the practice of experiential marketing and brand activations, challenges and other sundry issues in the industry: Excerpt…
Assessing the Nigerian Marketing Environment
Using the time frame of the last eighteen months, it is quite clear to everyone that we have a major challenge as far as the economy is concerned. Of course, commercial considerations within the economic landscape are largely driven by the demand side which is what the marketing function focuses on.
What we have witnessed in the last eighteen months is that there has been tremendous pressure to the demand side of most businesses. What do I mean? Purchasing power has reduced on account of several factors; the de facto devaluation of the Naira, the fact that there is acute squeeze in liquidity and therefore household incomes have become severely challenged. This obviously implies that consumers are not as free with money as they hitherto would have been.
We are witnessing a major upheaval in terms of household demand which translates at the end of the day to consumer demand and consumer confidence. Now, that ultimately implies that companies which have to create products and brands for such a consumer are faced with difficulties as people are getting more stringent in respect to what they choose to buy and why; people are becoming a little more calculated in their decision making as far as consumption goes and so your typical convenience kind of products are under a lot of stress.
Households are trying to balance budgets, so those little luxuries that would have been given to the household are being reviewed and people are now fundamentally changing what I call their consideration frame. That is what typically happens in a depressed economy. The consideration frame of the consumer becomes radically altered and people therefore move into priority needs. The messaging strategy has to change accordingly as persuasion is now driven by more rational logic.
There is also the challenge on the supply side. I have been speaking to many of my clients and they do tell us that even though they have slight upheavals on the demand side, the major problem their factories are facing is the supply: ability to get raw materials in because of the acute drop in foreign exchange. It means now that a lot of companies are unable to produce at full capacity. Because they are not able to do that, means that you have got issues in terms of redundancy. That is why you are seeing layoffs. Layoffs ultimately mean that households are further depressed by the fact that there is no money to spend.
We are seeing a downward spiralling in terms of activity of an economy that should not be where it currently is and while this might have been largely occasioned by the fall in price of crude oil, the truth is that the economic managers have failed to divest away from oil as our main source of forex over the years and prepared buffers to external and price shocks which we know as students of economics will always come in cycles. So, you find a situation where both GDP and national productivity have severely hit by commodity price fluctuations.
Challenges Confronting Experiential Marketing
Traditionally, experiential marketing or Below The Line (BTL), tends to be where brands go to when there is some form of decline. This is because it is no longer equity that becomes the issue but purchase. While equity is best served by advertising, demand generation and moving sales at the shopper level is largely driven by activation and its associated practices. You will find a lot of direct selling, more road show type scenarios, and grassroots oriented campaigns where you go into the villages to generate some revenues through retail distribution and direct sales. These types of activities tend to be what brands will look at because the marketing manager and the marketing director need to prove to his Finance Director that there is a clear return on investment on every naira that is spent. Experiential and brand activation tends to give you demonstrable return on investment. That’s the theory at least.
What we have seen in some experiential agencies in the industry is a serious lull in activities within the last six to nine months because of uncertainties. Marketing budgets have not been released because everybody has to wait and see the direction of the market and the direction of economic policies. Nobody is spending or giving briefs to agencies because we are all waiting to see where the economy is going. Now that we have a budget that has been released and we have reflation signals from the biggest spender which is the government, it becomes easier to plan. Not just that, it takes away uncertainty and it becomes easier to plan and to invest. Hopefully we will find that between this June and the remaining parts of this year that there will be some activities. Traditionally, activations pick up in the second to third quarter of the year. That is when agencies are busier as the brand managers release their briefs.
But having said that, the notion of agencies being merely brief takers needs to be questioned. Agencies, especially those of us in experiential and brand activations need to review our model and ask fundamental questions about what we offer. Are we solution providers? In other words, are we partners with brand owners? What is our core contribution to their value chain?
Perhaps if we are courageous enough to change our paradigm from waiting for a brief and create value bankable propositions that are appealing in their own right, then perhaps we will survive this dry patch and position of sectoral growth into the longer term. You will see that our industry is ripe for all sorts of consumer led innovations that I believe will change the dynamics of our industry forces. It simply means you will be investing beyond the brief. And while I will be the first to acknowledge how difficult that transition can be, without mincing words it is vividly clear to me that it is time for us to bite the bullet and invest beyond the clients brief.
Investing beyond the brief means we have to reassess what our value proposition is. In changing that notion of what our value proposition is from the agency that waits for the brief to practitioners in the area of branded consumer experience and assets, we have to start with ourselves and begin to reconstruct what this all means as business owners. We probably need to fashion out how we can become co-creators of both perennial distribution and experiential channels and assets and not just short-term activators. Indeed the major management consulting firms were faced with similar challenges at the end of the dot com boom era. I have seen something like this is Vegas and LA where agencies have become owners of major planks and platforms that serve more than just brands.
Quackery in the Industry
The issue of Quackery has been in the business as far back as the early 2000s when I was the managing director of Tequila. My own experience as an agency lead in this issue of quacks is that in those days the buzzword was direct marketing before we came to experiential. I think quackery will always exist in an environment like ours where standards are low and enforcement or regulations are poor, but I also think that the brand owners have systems in place to know who is a bonafide practitioner and they know who to give their briefs to. What we saw happening was a collapse of standards even at the client end in terms of those that are being invited to come for pitches because the brand activation business has a very low barrier to entry and that has been in existence for many years. You didn’t need more than a briefcase and a brief to call yourself an agency and the brief normally would come from places where you have relationships. However, overtime, depending on the quality and the nature of the management of that company, there are processes in place that makes you know who to give the job to and that is why the biggest players on the agency-client side are the ones who have the most important pitches.
The other issue is finance. We don’t have prerequisite capacity to generate money for the job and that forces you to go to the bank, and because of the present economic situation banks are even becoming very careful in choosing who or which businesses they finance and every company has that problem. Unfortunately, an advertising agency doesn’t have the same financial capacity challenges as an experiential agency. An advertising agency’s need for cash to be able to execute work for client is not at the level of an experiential agency which has to generate cash because we are more cash consuming and so, it’s harder for us and this affects our industry more.
Roles of EXMAN
I believe that EXMAN has done very well. One of the good things that has happened to us is the agreement amongst all of us, the major players in this industry to come together and try as much as possible to self-uplift, self-promote and ultimately to self-regulate. I think that over the last 3to 4years during the tenure of my predecessor, Mr. Kayode Olagesin and I within the last year we have tried to ensure that it “makes sense” to be in EXMAN, and the industry has taken notice.
Today we have about 35 members and each of these members are practice certified and have signed up for a code of practice. Each one of them have sent senior people at the level of directors of HRs, the level of directors of client service to important trainings offerings. We have tried to understand in several ways what our common problems are and how we can have a common solution to those problems for the benefit of all. One of the important things we did when I became president was to invite all leaders of our sister sectoral practice areas to our inaugural trustee’s dinner. We introduced ourselves to our other sectoral colleagues, we discussed with them ranging from the APCON and ADVAN Presidents to the then president of AAAN who spoke well of what we proposed to do and what we are coming up with and gave us a lot of useful advice on how we can push the body forward and we are doing that.
We have 6 operating committees within EXMAN, each charged with a very clear task to drive our agenda for growth and our purpose, which is to jointly grow Nigeria’s brands through meaningful experiences. We have the advocacy committee headed by the past president. The committee is charged with the responsibility of making sure we stay connected with all key players. The committee represented us for example at the last town hall meeting with the vice president of Nigeria and we had an excellent take out. We also ensure that we are in touch continuously with AAAN while also making sure that we are driving our agenda for our rightful place in APCON. Our training committee has being spectacular in putting together some excellent training programmes. We started what we call “practice group programmes”. The practice group brings all heads of different agency together for a 2-3 days programme and we basically do training in very key areas that we all share. Last year, we did it in November and we focused on Intellectual Property Rights. We had a very inspiring session on how do we ensure that the property rights of artiste we engage for our jobs are protected and also, we opened our doors to talk about how we can effectively negotiate an official rate for our members. We talked about taxation and we had a tax consultant present and he talked about how we can manage our tax liabilities. We had one of Nigeria’s most respected HR consultants Mr.Longe, who spoke to us on how we can create an environment that is suitable enough for talents and how we can allow these talents to grow. We are doing this to take away the non-vital and non-core aspect of competition while we all come together and compete based on ideas.
We launched our own newsletter (EXMAN NEWSLETTER) at our third AGM in Abuja in July this year. This will help to keep people informed about EXMAN. We are also looking forward to starting EXMAN meets with the entertainment industry which will be an evening programme where EXMAN will meet with the key players in the entertainment industry, and finally we also launched EXMAN Brand Ambassador’s Programme during our AGM in Abuja in July. This programme will allow us to finally have a master register of all brand ambassadors who work across all the 32 agencies and we could give these young people the opportunity to get an online training which will allow them to be trained and get certified and will also afford them the opportunity to get accident and life insurance cover for any EXMAN registered member they have worked for.
What next for EXMAN
EXMAN is an open trade body. That means it is opened to every agency that is able to meet the requirements of the body and are therefore entitled to knock on the door. The wisdom of the last executives on which I served as the vice president was to make sure everybody was invited and nobody was locked out because it’s not a special group for special people. We celebrate agencies that meet our standards and join us. It is a trade body for agencies that have agreed that we need to organize ourselves and so it should grow in membership size.
The new executive members who I am very grateful to, are redefining the mission and the vision statement of EXMAN to say that what we are interested in is to grow Nigeria by helping her brands grow through meaningful experiences. Our fundamental agenda is growth, now it is tough because of the present economy problem. So, in the next 5 years my prayer is that EXMAN would have grown and the industry it represents would have grown in size and contribution of GDP. I hope that we would have handed over a better respected and structured professional industry to a team of people who will take over from the current executive. We are working on protecting and preserving the integrity of the practice. Promoting and making sure we are relevant in the future of Nigeria’s brands.