Agencies prepared to face uncertainties

Bala Pomaleh

PETALING JAYA: After undergoing numerous movement restrictions, advertising, media and communication agencies are more prepared to take on the challenges posed by the current lockdown.

Even though the road would be a bumpy one, agencies are not taken aback unlike the first movement restriction in March last year and have strategise themselves to ensure business sustainability.

Mediabrands Malaysia chief executive officer Bala Pomaleh said the agency’s business approach has evolved to meet the changing needs of clients and businesses after more than a year since the onset of Covid-19 pandemic.

“For this year, we anticipate a 10% growth in new activities and business streams. A third of this is coming from non-legacy streams that include consulting, analytics and e-commerce, and we are continuously tracking with data to identify new opportunities that will arise.

“While it has been a tougher year, we are nonetheless more experienced with the situation, and there are lesser surprises with how we manage it. Likewise, clients are coping in a similar vein. Again, a lot of this will depend on how long the lockdown prolongs,” he told StarBiz.

However, Bala said looking at the situation as it stands, there is optimism as the number of Covid-19 cases drop amid the ramping up of vaccination.

By diversifying its revenue stream in e-commerce, dynamic content, search engine optimisation (SEO), customer relationship management (CRM) and data management platforms, the agency has continued to find new pockets of opportunity to make advertising budgets work more effectively for clients.

SEO is the process of improving a company’s site to increase its visibility for relevant searches.

Reflecting these changes and shifting business needs, he said the agency has expanded its hiring of more data and digital talents to work in tandem with business teams to help clients improve customer flow and complement their brand experience online.

“By investing in future-ready talents and upskilling existing teams to be more adaptable, we are ensuring our talent pool is more resilient and robust to face the economic impact of the pandemic.

“Programmes include brand-led universities that contain agency best practices, bespoke digital and tools training to enhance capabilities and craft, and personal growth and development plans tailored for different levels of talents,” Bala noted.

He said sustainability is also tied to Mediabrands’ relationships with clients and partners.

“The pandemic has shown us that the culture of the organisation is at the very core of our survival. While outcomes of delivery are important and solutions are in place, sustainability starts from within, with our people, and the people we work with,” he added.

Tan Kien Eng, group CEO of dentsu malaysia, said the agency has accelerated its transformation plans amid the pandemic.

“We are building a technical spine across our business and developing this powerful end-to-end capability to put those solutions into the world and make them real.

“Our focus on driving organic growth is generating strong results. Our offensive pitch pipeline for media business is very sizeable. We are investing in the customer experience management service line and are making significant strides in our agency of record initiative across creative lines.

“We are also integrating future work initiatives and putting our employees’ well being (mental health) at the forefront to ensure our ability to radically collaborate in virtual teams,” he noted.

Tan said he is upbeat on the ad investment for the industry this year based on the dentsu Ad Spend report. According to the report, compared to 2020, advertising investment is forecast to grow by 5.8% globally in 2021.

He said that in Asia-Pacific, the industry is expected to see ad investment growth of 5.9%, driven by uplifts in enduring shifts to digital that advertisers made in response to the significant restrictions placed on people’s lives through lockdowns.

Despite the positive momentum in 2021, the report noted that the ad industry in the region is unlikely to see a full return to pre-pandemic levels of advertising until 2022.

M&C Saatchi Malaysia CEO and founder Datin Seri Sharifah Menyalara Hussein said despite the pandemic, the agency is maintaining a positive mindset and recognising that much of the country as well as other businesses are in the same boat.

“We need to work around the barriers, in the interest of public health. With the advertising industry being a talent-driven business, we have put our people and their welfare firmly at the forefront. Business sustainability starts with sustaining people,” she said.

At the same time, she said the agency has taken several steps to mitigate the impact of the pandemic.

Sharifah said the agency is tapping new revenue opportunities by expanding its core services into new offerings, for example corporate strategy, branding and even meeting client needs for high-quality, fast turnaround content via its new company, Watermelon Productions.

“We are using ‘Lean, Agile, Flexible’ as our new mantra, ideal for an agency of our size. We are able to adapt to clients’ new realities by streamlining processes and efficiencies, and provide more value, team cohesion and responsiveness despite operating largely from home.

“At the same time, the agency has employed strategic cost-cutting measures where necessary. This has paid off and we have been able to retain all our employees this year, despite the massive challenges the industry is facing,” she said.

Meanwhile, GroupM Malaysia CEO Chanchal Chakrabarty said that 16 months into the pandemic, many businesses have adapted to the times and hence the declines in advertising is only partially mirroring the declines in the overall economic activity with the extension of lockdown.

“We have also adapted and diversified our business by adding or rather fast-tracking capabilities more relevant to the times. And that has helped us sustain our business in 2020 while helping us grow this year.

“Our core business of media planning and buying continues to have some impact with some cuts in marketing spends and certain platforms like out-of-home (OOH) and cinema not in demand.

“But our diversified services like end-to-end e-commerce strategy, consulting and activation, affiliate and influencer marketing, SEO, agile creative development, branded content partnerships, SME consulting and so on are growing rapidly,” he said.

As the majority of the large global markets like the United States, Europe, China and India are showing significant growth trends in the first half, he viewed this as encouraging news for GroupM.

He said this is because the agency has a plethora of global clients and with the large markets delivering growth, the marketing spends of these clients would not be cut and might even grow in Malaysia.

Commenting on the lockdown, Andrew Lee, who is Havas Malaysia group managing director, added that: “The the only thing we can do in the advertising industry is to protect and take good care of the people in the agency while we await the much anticipated economic recovery.

“The right plan is to expedite the vaccination process by focusing all efforts on procuring, distributing and vaccinating the rakyat.

“There are millions of Malaysians waiting to be vaccinated – almost 14 million Malaysians have registered but only 1.4 million have been fully vaccinated since the vaccination programme started in February.”

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