Digital is the only certainty and brands must take better note

Dentsu Aegis Network APAC CEO Nick Waters 

– Pic by Indraratne Balasuriya

By Darshana Abayasingha

Campaign Asia recently ranked Dentsu Aegis Network (DAN), the multinational media and digital marketing communications company, the Most Creative Agency Network in the Asia Pacific region for the second year running. 

Speaking to Daily FT in Colombo last week, the company’s CEO for Asia Pacific, Nick Waters, averred the prestigious accolade is a result of the focus and effort DAN has placed on building brands with creativity at its core. Creativity is the big driver of his business he said, adding that the company has infused greater capacity and creativity into the organisation via partnerships and acquisitions in markets around the world. 

More recently, DAN set out on a mission to become a fully digital organisation by 2020 and Waters explained why. “The rationale for that is the only business certainty for now is the digital economy. If you look at any industry sector it has been materially disrupted by digital technologies and capabilities, which has significantly changed consumer behaviour, and there are many popular day-to-day examples to this. We need to ensure we are able to advice clients on how best to organise their business, and how best to operate within digital economies.”

Relative to the global thrust with digital and social media, Waters said that the current controversy surrounding Facebook and the debate on privacy and consumer data security is a challenge to any platform business, in addition to ensuring they are not manipulated for unscrupulous means. 

Whilst noting with interest that these issues are yet to impact the revenues and share value of Facebook, he added it was important for platforms to address data protection and trust issues or face the very real potential of government regulation. Fake news was another area of concern that caught Waters’ attention stating that agencies must work closely with brands to ensure marketing communications take place within a safe environment. 

“For example, it emerged last year that advertising was appearing on ISIS channels on YouTube, therefore there are various things we must do to ensure brand safety and that brands are not appearing on inappropriate channels. Then there is also the measurement issue; strategies and techniques to ensure that advertisements are appearing in front people and not robots. There are a range of things we do and must do to ensure the safety of our clients,” he added. 

Digital technologies and economies are in various stages of progress the world over, and Waters remarked that smartphone penetration is a significant driver of change or adoption. With Sri Lanka presenting over 50% penetration of smartphones, this would result in rapid adoption of new ways doing things – through digital technologies – as it hits critical mass as witnessed in India.  Waters averred that Sri Lanka is at the threshold of a digital transformation, supported by a material market size and highly literate population. The peace dividend has also created a good environment for economic growth with considerable new overseas investment and dramatic infrastructure improvement, which generally improves productivity and opportunity for business and brand growth, he commented.

Touching on the diversity of the Asian region, Waters remarked that every business needs to adopt a digital strategy for the future at various stages of adoption. With respect to brand building, this would entail employing different parts of the marketing mix as per market. 

For instance, in Sri Lanka free-to-air broadcast form a majority segment of the market and will remain so here and in many countries, whilst in others it’s a diminished segment where a significant proportion of the viewing is done via streaming with no advertising on those platforms. Thus, agencies and brands need to think ahead and be creative on how they engage with consumers, he added. 

“There is a trend where the barriers to entry for niche brands are falling, as small companies reach larger markets through the internet. What we see in many countries is the big established brands losing market share to such small niche entrants. The brewing industry presents ample example to this where there has been an explosion of ‘craft’ beer and consumer trend and taste is for this artisanal niche as opposed to mass market products. What we are focused on is helping our clients understand these changes and the digital economy, and how to build brands in this modern milieu to meet consumer needs. Every industry is going through a transformation that creates both challenges and opportunities, and it is up to leaders of business how to manage that and agencies must also guide customers on what they can do with customer data for instance in a responsible manner,” Waters stated. 

Dentsu Aegis Network is a global giant in the media field and Sri Lanka welcomed the company in March 2017. DAN was recently placed third largest in the world terms of market capitalisation amongst creative agencies. Dentsu Grant is its coming together with the Grant Group, the pioneers of advertising in Sri Lanka since 1958, and the Dentsu Aegis Network to create a unique entity that combines a deep knowledge and love of Sri Lanka with world class innovation, know-how and technology.