The who’s who of the advertising industry from across the Middle East and North Africa and beyond were brought together last month at the MENA Cristal Festival, amid the snows of Mzaar Kfardebiane. The highlight of the event, held February 1 through 5, was unquestionably the evening awards ceremonies, where the advertising agencies with the most innovative and best executed campaigns of the year earned their recognition in the spotlight.
During the days, however, among the various conference debates, round-table talks and chats in the hotel lobby, it became apparent that all is not at ease in the advertising industry. Beyond the fact that the sector, globally, lost up to 11 percent of its revenues last year as the financial downturn squeezed clients’ budgets, there is also a new reality bearing down on the industry, changing the old paradigm within which people once worked.
“Some people still feel that digital is just another channel, but its not, that’s the whole point. `It’s not an evolution, it is definitely a revolution,” said Dimitri Metaxas, regional digital executive director for Omnicom Media Group. “It is definitely something that has moved on and changed the rules of the game.”
As Richard Pinder, chief operating officer of Publicis Worldwide and president of this year’s MENA Cristal Festival, put it: “The difference between the new world and old world is two-way versus one-way.”
The near limitless availability of information online has made consumers far savvier than previous generations, said Metaxas, which, combined with any online users’ ability to reach a global audience almost as easily as a multinational corporation, and has led to a “democratization” of the process.
“We’re now in a forum, and not a pulpit,” he remarked. “This has shifted the consumer from that lower level of happily consuming what it is we tell them [to], to now having a very active role in that communication.”
Digital’s two-way street
Metaxas illustrates what this new dynamic can mean, using the example of the United Arab Emirate telecommunications provider du, which had recognized that it had an image problem with regard to its customer service. To address this, the company first opened an account on the Twitter social networking service and incentivized people to ‘follow’ it, using contests to win an iPhone, just as du was launching its iPhone service in the United Arab Emirates.
The company then transformed the Twitter account into a customer service channel.
Metaxas said in monitoring the “buzz” in online posts and chat rooms, many complained that du’s customer service was unresponsive.
“They turned their customer service into a marketing problem, and they committed to changing and solving every person’s query or customer service issue,” he explained. “What ended up happening is all these really negative statements — literally 99 percent of them — have transformed into positives.”
People who had posted comments like “customer service — nightmare,” were now posting comments like, “du, I can’t believe you’re actually listening to me, and two, you solved my problem.” The idea that digital advertising is little more than banner ads on websites – i.e. simply a “digital version” of what would be on TV or outdoor billboards — is a concept quickly becoming antiquated; it is the ability, even necessity, to include customers in campaigns that makes digital advertising a radically more expansive concept, said Mataxas.
“If you make [consumers] part of the process, then you create advocacy out of it, and that, I think, is a far more powerful emotion than just advertising at them,” he said.
“Advertising is fantastic at building awareness, and it can engage if it’s really good…but that’s still a one-way process, and I think that is one of the fundamental shifts we’re talking about that social media has created. People have an opinion; they want to voice that opinion. If you ignore them, then you do it at your own peril.”
Blurring the lines
The digital revolution is creating anxiety among the veterans of advertising because it breaks down the walls between what used to be clearly defined roles in the production chain.
“Media, creative, public relations, direct marketing, customer relationship management — they’re all blurred,” said Pinder. Even while uncertainty grows about individual responsibilities within the new digital paradigm, it is ever more certain that the digitalization of advertising will only accelerate. Pinder said that two years ago Publicis Worldwide’s revenue from digital advertising was zero; today it is 20 percent of total revenue and his aim is push that to 30 percent by 2012.
“Where I had an office that didn’t have digital, they had a catastrophic 2009,” said Pinder. “I have seen offices — both mine and from other networks — that [lost] one quarter of their revenue in one year, by not having digital.”
“In one particular office, their ad agency was down 35 percent in 18 months but their digital was up 75 percent, and they ended up at minus 3 [percent],” he continued. “People who tell me digital isn’t that important or it’s just a sideshow of advertising — no way. This is going to be one third of my business in two years.”
Pinder says Publicis is in the process of rebranding all of its global digital assets under the banner of Publicis Modem, and is planning an aggressive digital expansion in the Middle East “very soon.”
Hussein Freijeh, Yahoo’s director of advertising sales at Dubai Internet City, explained that Internet penetration across the region has been expanding at more than 50 percent per year for the last four years, allowed for by the expansion of telecommunications infrastructure. He pointed to Egypt as one market that was “massively growing,” and said that in Dubai — already the region’s advertising hub and arguably the most wired-in of the region’s cities — is so far at the crest of the digital wave.
It seems, however, that some of the biggest players in the advertising and business communities still have their heads stuck in the sand.
“[Last year] we saw some major brands double their spending online, but we saw other major brands not spend a penny online,” said Freijeh, who lamented that one of the biggest challenges he still faces is to shift people out of the “offline” mentality.
With the digitalization of the future being near predestined, this reticence is baffling. But then again, it is in the nature of revolutions, digital or otherwise, for there to be those who recognize the significance of developments as they are happening and adapt to excel in the new reality. And there are always others, too married to the comfort of the old ways to change, as the shifting tide washes them into irrelevance.