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No Sane Chief Executive Will Give Away Top Dollars to Foreigners Without Seeing Value, Says Interswitch Boss

Mitchell Elegbe, Managing Director, Interswitch.

The Managing Director of Interswitch, Mitchell Elegbe has retorted that no sane CEO will give away top dollars to foreigners without seeing commensurate value. He said this while presenting a paper at the recently concluded 2021 Association of Advertising Agencies of Nigeria (AAAN)/AGM/Congress.

Elegbe was responding to a question on the frequent tendency among banks and other mega-corporate brands to readily gulp any proposal from foreign consultancies while ignoring local expertise even when the presentations of the local players are similar or even superior to what the foreign consultant is offering.

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 An attendee has explained that his agency had been trying to sell an idea to a bank for many months without success only for the boss to involve a foreign associate in the project. The same idea they have been trying to sell for months was presented by the foreign associate to the bank and they gulped it with lightning rapidity. It was signed and sealed the same day.

Another instance presented by the attendee was the strange negotiation trend among most corporate organisations in the country. Even negotiations involving agencies in Nigeria with the capacity to do extended strategies and integration. When it comes to payment, most Nigerian companies will prefer to make top dollars payments, to a foreign company than pay even 60% of the amount they had conveniently paid a foreigner, to an indigenous consultant.  

Mr. Elegbe was asked “what could be the problem? Could it be that we don’t believe that we can create and execute for brands within Nigeria or it is just like the Nigerian spirit that our preference must always be for things that are manufactured or produced outside the country?”

In his response, Elegbe started by clarifying that his organisation, Interswitch, with an embedded belief that companies in Nigeria can do things even better than foreign companies, will not take top dollars to pay foreign companies just for the fun of it. He promptly followed up with series of rhetorical questions; “Is it not true that most major advertising companies in Nigeria have a foreign Technical partner of some sort? If this is the dominant trend in your industry, what is the perception that you are giving? Is it that the local firms cannot do it alone so they need foreign firms?”

However, he explained that when there is a need, and a pitch is called and a team makes a presentation that synchronises with an organization’s vision and strategy, it will strike a chord of acceptance even if the presenter is from Australia or Asia.

 So the challenge for AAAN, according to Elegbe, is to grow the sector and get more people to think strategy. “So what stops an advertising or media company from buying a small consulting outfit? He asked because not all of us can consult the big consulting firms, but we still need strategy, branding and other vital things to excel”. 

Elegbe now followed up with a bold assertion, “So, what stops one of our organisations from looking for a small consulting outfit to buy so that we can offer the same huge package like foreign consultants. I really wouldn’t want us to think that there is any company that will just give money to any foreign company. If your company brought a foreigner in, and you are very sure that it was not because of the colour of his skin but because of the skill set that he had, and he came to say something that led to what you guys could not deliver for months, then it is possible that he must have convinced them with something new or the same thing was presented more convincingly. No sane CEO will give top dollar to foreign companies just for fun”.

Elegbe was also asked to share his thought about consulting firms like PWC and others, buying up big advertising agencies and making in-roads into the business of advertising. 

He answered using a previous experience of his company. He explained that even when they had a reputable agency working with them, they still had to look out when it was time to think about strategy. In his words, “We had to bring from outside, a Dutch company which was at our first attempt. The second time we wanted to refresh our brands, we went to a South African firm. I just finished a 5-year strategy and guess what, it moved from this is the strategy for the company, to this is the consumer-facing strategy. 

“They always ensure that you engage your customers from different touchpoints and it is usually very tempting for a company to go for it as they are always pushing to expand the scope of the business. Instead of just doing strategy and leaving, they finish the strategy and stay back for the execution. So it’s easier for them to bring their sister company, subsidiary, or associate at different stages. Since the company will not want the strategy to fail, they give in. You actually see them executing things again and again. I feel this is one of the most compelling reasons they are buying up agencies as areas of demand growth, and it might not end anytime soon. We must also look for ways to buy some agencies and consultancies across the globe, no matter how small, as the world is increasingly becoming a global village ” 

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