About 31 years ago, Insight Communications approached one of the major banks in Nigeria for a loan of ten thousand Naira. Yes, ten thousand Naira. The money was to serve as a revolving car loan for our staff at the time. Three of them had each applied for a three thousand Naira loan to buy Volkswagen Beetle cars. The bank turned down the loan application. Reason? Advertising profession was classified as being in the non-preferred sector of the economy! Twenty-five years down the line, the same bank was pressurizing our group with a two billion Naira revolving loan. What has changed? Whereas total advertising spend in 1981 was not more than 13.3million, it ballooned between 2004 and 2010 to about $650 million! Small, by global standards, you may want to say, especially when we realize that exit 2010, worldwide communications services – advertising and marketing services – spend rose by 6.5% to $798 billion from an actual spend of $757 billion in 2009 ( Source: WPP). WPP’s market share stood at 10%.
Indeed, Sir Martin Sorrell, CEO of WPP, only recently announced the trading result of the world’s largest marketing communications group for 2011. While $72 billion was given as the group’s turnover, revenue was $16 billion, while profit stood at $1.92 billion. While WPP’s new business growth in Media investment was $2.539 billion, its agency billing grew by $1.455 billion. Interestingly, over 30% of the group’s revenue came from direct, digital and interactive media. I wonder what this picture portends for the future of marketing communications.
I don’t think we should despair because of the current, relatively low spend levels in marketing communications in Nigeria, because nothing is constant. The way the world and our industry do business is changing as its economic centre of gravity moves. Before now the USA accounted for 50% of marketing communications spend, with Japan, Germany, the UK, France, Italy and Spain almost making up for the balance. Not anymore. Thanks to BRIC nations. As the equation continues to change, the world must contend with what Goldman Sachs calls the Next 11 (N11) countries of Vietnam, Bangladesh, Indonesia, Iran, Mexico, Nigeria, Pakistan, Turkey, South Korea and Egypt.
These countries, along with those BRIC nations, could be the next economic power house of the world as those of the Western nations stagnate. My information is that global marketing communications groups are already scrambling for joint ownership of some of the major players in Nigeria. How this plays out will be interesting to see as no less than four of them are presently in Nigeria – Publicis group, SO&U group, Rosabel Leo Burnett, Interpublic group – Lowe Lintas`, Centrespread; Omnicom group – DDB, BBDO, WPP – Grey, JWT, O&M, Y&R.
With multinational clients shifting more focus on our continent, and Nigeria in particular, what do I see as the future of marketing communications? It might interest you to note that WPP’s phenomenal growth came majorly from Asia Pacific and Latin America, even if the USA, UK, Austria, Germany, Switzerland and Turkey managed like-to-like growth.
So to look at this subject holistically, let’s start by creating meaning by asking, what is marketing communications? And what are the elements that can be said to make up marketing communications today?
· Advertising
· Media [traditional, online, social, mobile]
· Experiential/events
· Consumer engagement platforms [Apps, microsites, e-books]
· Public Relations
· The consumer
Did I say the consumer? To this we will return soon as I suspect you are likely to ask how the receiver of messages can actually be engaged in the process. Each of the elements mentioned above is fertile ground for radical new thinking that’s redefining our industry.
However, to see the future, we must take learnings from the past. In 1980, when Insight Communications opened shop, there was only one national TV network in Nigeria – NTA, with two local channels in Lagos, and a budding state TV station – LTV 8.
In all the states, only NTA stations were in operation. Combined, these stations enjoyed over 90% reach during their peak years, and at that, communication was largely one-sided.
That world no longer exists.
General Eric Shineski, a retired Chief of Staff of the U.S. Army stated, and I quote:
“If you don’t like change, you’ll like irrelevance even less”
The truth is:-
The world has changed.
The language has changed.
The pace changed.
The foundation for tomorrow is here today. And it revolves around one word: COMMUNITIES.
Communities have become our social currency because it underpins everything we do as marketers. ‘Communities’ involve three key components: PEOPLE, RELATIONSHIPS and CONTEXT.
People come together to form relationships that are built over time, and interact regularly around contexts, which are of interest to them.
The arrival of the digital age has caused a fundamentally huge shift in how people now communicate and relate with one another, on the one hand; and the various ways they go about getting information, sharing ideas, collaborating, and even working together on the other.
Here are some examples of how people actively communicate today:
Social media, social networking, crowd sourcing, blogging, microblogging, sharing, commenting, embedding, linking, tagging, posting, rating, participation and conversation.
This simply shows how communication has assumed a multi-dimensional form; and the various ways messages are now being transmitted during social media interactions. Today, to be successful, marketers, and by extension their advertising agencies, have to ensure that they deliver singularly powerful and differentiating messages about their brands to consumers, who can:
1. Access media directly
2. Influence media
3. Influence thinking
4. And are themselves, media
The media landscape is continually evolving, hence, one-way communication is becoming extinct; simply putting messages out there has become largely ineffective. People want to be a part of the conversation. The context in which media is placed and how it is communicated is as important as the content of the message itself.
To sum up the phenomenon: everything we do is the new media; communication is getting more personal, experiences are now social and shared.
For a brand’s communication to be successful, there must be a perceived ‘human voice’. This voice must be “seen” and be ready to engage and relate with consumers that now can be identified either as individuals or groups.
By taking a cue from the consumer’s perspective, this ‘voice’ has to understand the need for relevance and meaning, beyond the primary function of simply encoding messages. In essence, communication must be relevant, engaging and interactive.
Because of the active involvement of the consumer in the process, it is important that we understand how they now adopt media; how they perceive media; how they differentiate media; and most importantly, how they use it to inform, influence or manipulate others.
Advances in technology now allow consumers to move into what hitherto was the precinct of the traditions of advertising agencies – ideas generation, the production, to media buying and distribution – and they are now customizing it to suit their needs.
From the comfort of his home, a 15-year old kid in Aiyepe, a sleepy town in Ogun State, with a population in the province of one hundred thousand, lacking in potable water, but with access to a desk top and the internet through MTN, can develop an App using free software downloaded online and distribute it via iTunes or Amazon, or share on LinkedIn or Facebook – all within twenty-four hours.
So what have I gone round in circles to tell you? – The digital revolution has ensured that people are no longer just ‘consumers’. They participate in the creation of ideas and product, production and distribution as much as any marketing communications agency. The implication for this is inherent in the fact that the homogenous brand messages we’ve been built to make and deliver on behalf of clients are being increasingly ignored because people have better things to do.
The stuff people are sharing with each other is now more interesting. They enjoy being part of the communities that they are genuinely, enthusiastically involved in more!
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