Advertising + Marketing Magazine Malaysia - October 2016

OCTOBER

2016

T H E

L A Y E R S

W H AT

I T

T H E

TA K E S B E A U T Y

T O

S U R V I V E

I N D U S T R Y

I N

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ED’S LETTER

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Editorial Rezwana Manjur, Editor rezwanam@marketing-interactive.com Monisha Rao, Senior Jounalist monishar@marketing-interactive.com Venus Hew, Senior Journalist venush@marketing-interactive.com Vivienne Tay, Journalist viviennet@marketing-interactive.com Editorial – International Inti Tam, Deputy Editor (Hong Kong) intit@marketing-interactive.com Production and Design Shahrom Kamarulzaman, Regional Art Director shahrom@lighthousemedia.com.sg Fauzie Rasid, Senior Designer fauzier@lighthousemedia.com.sg Advertising Sales Joven Barceñas, Director, Business Development & Strategy (Malaysia & Indonesia) jovenb@marketing-interactive.com Ong Yi Xuan, Trade Marketing Executive yixuano@marketing-interactive.com Advertising Sales - International Johnathan Tiang, Team Lead (Singapore) johnathant@marketing-interactive.com Sara Wan, Senior Sales Manager (Hong Kong) saraw@marketing-interactive.com Event Production and Marketing Hairol Salim, Regional Lead - Events and Training hairol@marketing-interactive.com Andrew Davy, Regional Marketing Lead andrewd@marketing-interactive.com Event Services Yeo Wei Qi, Regional Head of Events Services weiqi@marketing-interactive.com Circulation Executive Deborah Quek, Circulations Executive deborahq@marketing-interactive.com

Minutes before I sat down to write this month’s editor’s note, the song playing in the background was this crazy Japanese PenPineapple-Apple-Pen song. My colleagues were singing it loud and proud.

At that moment, staying late to wrap up the pages of the magazine didn’t seem so tiresome anymore. We were laughing, singing and sighing (and wondering what to order for dinner). One simple moment of insanity bonded the 11 of us from completely different departments, and we forgot the piles of paperwork stacked on our desks.

It made me think, this is probably why many love the ad industry – because of the bonds made over unforeseen moments, despite the work load. Recently, we ran an article on what working in the ad industry gives back to an individual. This resonated with many of our readers, and easily became one of our top read stories online for the month of September.

In the article, the author said: “You will either love it and thrive or hate it and not survive. But you will only endure if you have the passion.”

As ruthless as it sounds, she was right.

This industry is meant for the daring and the passionate. The multi-tasker: The one who plays the role of the baker one day and the banker the next. You have to be a poet and the pauper. You are a jack of all trades – with the power to master them all.

You have to master riding unforeseen moments of a crisis. During a conversation with a friend of mine working in the event space, she said: “No amount of team-bonding can bond your team like a crisis can.”

She was right. It is in a crisis that we show resilience and heart. So maybe, as an industry, we should take advantage of the difficult times.

Yes, ad fraud and inflated numbers are worrying matters. Yes, clients are shaken up about their digital dollars. But no, this doesn’t take away the glory that advertising really is.

Don’t get me wrong, I am not saying we shouldn’t fix them. I am just saying that we should believe the industry is resilient enough to get past it together. It is ultimately moments like these that will force us to work together, collaborate and co create.

As September ends, I look forward to us not only survivng, but rather reigniting our passion and love for this industry.

Enjoy reading.

Finance Evelyn Wong, Regional Finance Director evelynw@lighthousemedia.com.sg Management Søren Beaulieu, Publisher sorenb@marketing-interactive.com Justin Randles, Group Managing Director jr@marketing-interactive.com Tony Kelly, Managing Director tk@marketing-interactive.com

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For subscriptions, contact circulations at +65 6423 0329 or email subscriptions@marketing-interactive.com. COPYRIGHT & REPRINTS: All material printed in Advertising + Marketing Malaysia is protected under the copyright act. All rights reserved. No material may be reproduced in part or in whole without the prior written consent of the publisher and copyright holder. Permission may be requested through the Singapore office. Disclaimer: The views and opinions expressed in Advertising + Marketing Malaysia are not necessarily the views of the publisher. Singapore: Lighthouse Independent Media Pte Ltd 100C Pasir Panjang Road, #05-01 SLC House Singapore 118519 Tel: +65 6423 0329 Fax: +65 6423 0117 Hong Kong: Lighthouse Independent Media Ltd publisher of Marketing magazine 2/F, Connaught Harbourfront House, 35-36 Connaught Road West, Sheung Wan, Hong Kong Tel: +852 2861 1882 Fax: +852 2861 1336 To subscribe to A+M Malaysia magazine, go to: www.marketing-interactive.com

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A MEMBER OF

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Rezwana Manjur Editor

JU NE 2 016 M ARKE TI N G 1

Photography: Stefanus Elliot Lee – www.elliotly.com; Makeup & Hair: Michmakeover using Make Up For Ever & hair using Sebastian Professional – www.michmakeover.com

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CONTENTS

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4 A MONTH IN NEWS A round up of a month of news from Malaysia and the region.

8 WHAT CAN SAMSUNG DO TO REGAIN CONSUMER TRUST? The brand spent years and a hefty amount of marketing dollars to compete against the likes of Apple.

Venus Hew examines the setback.

12

14

16.

HEINEKEN’S GRAND PLANS TO PUSH THE BOUNDARIES OF FORMULA ONE

What are some of the challenges for a global brand working with a startup mentality?

Rezwana Manjur finds out more about the company’s advertising strategy for F1.

WILL FREEZING NEW MALL LICENCES SOLVE ANYTHING? The proposal by the Malaysia Retail Chain Association has stirred up much comment. Venus Hew writes.

DENTSU’S JOURNEY THROUGH TROUBLED WATERS Having recently faced troubles and backlashes, Dentsu is struggling to navigate its way through the industry.

20 PROFILE: HENKEL Holding a dual role in sales and marketing, Henkel’s Davin Leong discusses how the global brand has

adopted a start-up mentality with Vivienne Tay.

SCAN TO SUBSCRIBE!

12 8 What you’ll learn in this issue: >> Finding the sweet spot between sales and marketing. >> Regaining trust once it is lost. >> Winning over Millennials.

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14 24 O C T O B E R 201 6 | a dvert i s i ng + m a r ke t i ng 3

ON THE COVER: Art direction: Fauzie Rasid & Teck Lim; Photography: Teck Lim — Lumina (www.animulstudio.com)

24 GETTING IN WITH THE COOL CROWD Marketing reveals how brands can keep up with the fast-growing Millennial demographic.

NEWS

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WANT MORE BREAKING NEWS? SCAN THE CODE TO FIND OUT WHAT’S GOING ON IN THE INDUSTRY.

More revenue Amorepacific Malaysia’s latest cosmetics brand Mamonde launched its first counter, located at AEON 1 Utama. The newly launched brand is expected to contribute up to 20% of the company’s revenue in the next four years, Amorepacific Malaysia’s general manager Margaret Chin told the New Straits Times. The move follows recent local reports of the company’s plans to invest up to US$170 million in Malaysia’s Iskandar Puteri.

Pokémon Go hits Malaysia Pokémon Go was launched in Malaysia on 6 August. It was the same day the game was launched in countries such as Singapore, Brunei, Cambodia, Indonesia, Laos, Philippines, Thailand, Vietnam, Taiwan, Papua New Guinea, Fiji, Solomon Islands, Federated States of Micronesia and Palau. This comes a month after the game, developed by Nintendo and Niantic Labs, was made available in the US, Australia and New Zealand.

A cosy affair Sime Darby Property, along with its brand consulting parter G.A Brand Design Kuala Lumpur, unveiled a new luxury lifestyle brand called Alya Kuala Lumpur.

The brand is brought to life with a series of world-class sporting events, brand collaborations and meticulous master-planning and execution. Alya will also play host to a series of residential, commercial, retail and hospitality developments, with new public transport links and a gross development value of RM8 billion.

Game on Olympics fever hit Nestlé’s Malaysian and Singaporean employees after the company organised a sports meeting for its employees to encourage them to lead fitter and healthier lifestyles.

Dubbed the “Supermeet”, the once-in-a-four-year event saw more than a thousand employees from Malaysia and Singapore come together to compete in a range of sport activities.

Joining forces To support SMEs in Malaysia MasterCard collaborated with fintech company ManagePay Systems (MPay), to launch the MPay MasterCard prepaid card plan to offer alternative cashless transaction options. This follows a series of continuous changes the group is propagating towards the way money is accepted by small and medium enterprises (SMEs) and large enterprises in Malaysia, after the group launched the MPay balance account on 29 April.

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#ProudlyMalaysian Malaysia Airports launched a new initiative which will champion Malaysian labels and entrepreneurs. The campaign, called #ProudlyMalaysian, is Malaysia Airports’ commercial division’s key focus for the long term. It was officially launched on 29 August. The airport operator said it was leveraging on its strategic role to provide the "Proudly Malaysian" products and Malaysian talents the platform and channels to promote their offerings to an international audience.

New appointment for BBDO BBDO Malaysia added fire power to its team with the appointment of Rafiq Ridzwan as head of planning.

He joins BBDO from JWT where he spent 15 years. He brings with him a wealth of experience having worked on multinational and local brands in Bangkok and Kuala Lumpur. He was previously the associate planning director at JWT for four years. His appointment further strengthens the management team.

A new lead Malaysia Airlines appointed Arved von zur Muehlen as chief commercial officer. He takes over from Paul Simmons who left in mid-September. Before his appointment, he was senior VP of commercial network operations for Qatar Airways. He was responsible for the global sales strategy and development as well as innovation and technology with a revenue target of more than US$7 billion.

Milestone for LinkedIn LinkedIn Malaysia celebrated three million connected professionals in Malaysia. This important milestone comes as the Asia Pacific region crossed the 100-million member mark, doubling its member base within just two years. Besides Malaysia, the member base across other Southeast Asian countries continues to rise, hitting 18 million, including six million in Indonesia, four million in the Philippines and one million in Singapore.

Taking care of mental health IBM and the Malaysian Mental Health Association (MMHA) are teaming up to survey public perception surrounding mental health issues to narrow the awareness gap associated with the condition. The survey would be done using IBM Social Media Analytics, a monitoring tool that captures and consolidates insights from social media to analyse the opinions, interactions and conversation patterns expressed on Facebook, Twitter, online communities, forums and blogs.

A change in leadership Mindshare Malaysia announced a change in its leadership team.

This comes after its managing director Varun Channa told the agency he was leaving. Cindy Chia (pictured right), who has been with the agency since 1999, was named managing director to replace Channa. Simultaneously, Dheeraj Raina (pictured left), was promoted to general manager.

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NEWS

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Live in ‘Le Moment’ Kronenbourg 1664 extended its “Taste the French way of life” campaign with “Le Moment”, which embraces a form of desire to take time off from the usual hectic pace of life to enjoy little daily indulgences. At the Le Moment launch held at Caffeinees, guests were surprised by a flash mob that appeared among the audience, bringing the story of “Le Moment” to life.

Great stream of content Media Prima Television Networks (MPTN) partnered up with Maxis to enable Tonton subscribers on the MaxisOne Plan to receive free 5GB video streaming data every month, along with a free 60-day trial of Tonton’s VIP subscription.

Datuk Kamal Khalid, CEO, Media Prima Television Networks said, “The collaboration will allow MaxisOne Plan customers to easily enjoy quality content from their mobile devices.”

MAS everywhere Malaysia Airlines conceptualised a new marketing push to celebrate the second phase of its turnaround. The campaign celebrates Malaysia Airlines’ position as the national flag bearer airline with a two-day promotion, called “Here, There, Everywhere” on seats to selected destinations, both domestic and international, from as low as RM99 one way on Economy Class. In July, Malaysia Airlines also launched a new loyalty programme called Enrich.

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Jimmy Lim leaves PHD Jimmy Lim, general manager for PHD Malaysia, left the agency for a role with Phibious Cambodia, Myanmar and Laos as CEO. Lim was appointed in 2014 to lead PHD Malaysia across all business functions. The news comes weeks after Malaysian industry heavyweight Andreas Vogiatzakis, the long-standing CEO of Omnicom Media Group (OMG) Malaysia, took on a role with Havas Media Group as CEO

On top Naga DDB named Kristian Lee (pictured) as its new CEO. Lee succeeds the agency's previous CEO David Mitchell who was attached with Naga DDB since December 2008. In the new role, Lee is managing overall operations for the agency, upscaling Naga DDB's service offerings to clients, driving new business growth and consolidating the Foetus Group's capabilities to deliver a higher standard of marketing communications services to clients.

Cycle & Carriage CEO resigns Cycle & Carriage Bintang announced the resignation of its chief executive officer Datuk Wong Kin Foo. Dato Wong was the company’s CEO since March 2010, responsible for the group’s motor operations in Malaysia.

He stepped down on 31 August to pursue other interests and opportunities outside the company. Meanwhile, Ramasamy Devaraju, the current director of operations, is now managing the day-to-day operations.

Acer hands business to UM Acer handed its media business to UM Malaysia. The contract is for a year. UM won the account from incumbent Starcom Mediavest.

The agency will be tasked to carry out work across traditional and digital media, including radio, print, digital and out-of-home.

Acer Malaysia’s head of marketing Stephanie Ho said the agency put forward a vision that blurred the lines between media and creativity, data and content and science and art.

Usana doles out the dollars Nutrition company Usana Malaysia is showing its support to dodgeball player Muhamad Heidy Mohd Yusoff and triathlete Shahrom Abdullah for the next 18 months for RM100,000 each.

Usana Malaysia has an athlete guarantee programme which permits select athletes to enter an agreement with Usana which states that should the athlete test positive for a banned substance as a result of taking Usana nutritional products, Usana will compensate that athlete two times their current annual earnings.

CtrlShift names Malaysia lead CtrlShift, a data-driven audiencefocused marketing solutions company, made two new hires to its management team. Deepika Nikhilender has been named its new chief executive officer by the CtrlShift board. Serm Teck Choon, head of product, has also been given the additional responsibility of country head of Malaysia.

Serm currently leads product innovation and product management at the company.

IHG makes new hire InterContinental Hotels Group (IHG) hired Clive Murray as area general manager of Malaysia and Batam. Murray has more than 26 years of experience and was most recently the general manager of Radisson Blu Shanghai New World, a position he held for more than two years, after his tenure as the general manager of Radisson Blu Hotel Hotel Tianjin.

A new move Victor Loh, Shell Malaysia’s head of payment and loyalty, took up a new role as general manager for Aimia Indonesia. In the new role, Loh will introduce Aimia’s competencies to local organisations and bring client initiatives to the next level using the agency’s best practices, data capabilities, campaign tools and customer loyalty and engagement platforms.

Old Navy opens in Malaysia Global fashion label Old Navy opened its first store in Malaysia at 1 Utama Shopping Centre on 30 September. On the store’s marketing plan, Roy Lan, regional marketing and communications manager of Old Navy’s distributor RSH Limited, said the brand was launching a “robust 360-degree integrated campaign” spanning across multiple media channels such as OOH radio, and digital and is aimed at maximising the brand’s awareness.

Additions to the family M&C Saatchi-i Malaysia made two new hires to grow its digital offering. Darren Lee came on board from &samhoud to lead M&C Saatchi-I’s digital team as creative director. Jodie Collins, former managing director of RE Digital, also joined the team as digital strategy and social media consultant. Lee leads the agency’s digital creative teams.

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NEWS

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Kantar’s new look Kantar launched a new corporate identity for the parent brand and its 12 operating brands to create a more unified look and feel across the whole business. The new identity was developed with WPP’s branding specialists The Partners and rolled out across all external and internal communications channels. Operating brands not previously Kantar-branded will now take a Kantar prefix and a new, common typeface.

A bigger and better bunny Energizer Holdings launched a new campaign called “Bigger, Better, Bunnier”. As part of the campaign, the iconic Energizer bunny will be getting a new look.

Energizer said the bunny’s image had been modified to showcase his fun and witty personality with a slimmer body shape and more expressive facial features.

However, his iconic pink fur, sunglasses, and blue flip-flops will remain intact.

On the Flipside Global communications and engagement firm Weber Shandwick acquired Flipside, a specialised mobile and digital agency. Terms of the deal were undisclosed. Together with Flipside, Weber Shandwick will deliver a full-scale, modern digital offering that blends content, community and commerce for both B2C and B2B marketers.

Flipside has developed mobile apps and digital experiences for some of the world’s largest global brands.

HOW MUCH DOES THAT COST?

POPPING UP EVERYWHERE

Robinsons and Kingsmen Projects collaborated to create a new generation of smart retail pop-up concepts.

The pop-up retail space is embedded with in-store analytics hardware and software which allows for the tracking of the store and merchandise concentration daily.

Through media sensors, the footfall and kinetic map of a customer’s movement are captured daily and insightful data is generated, enabling brand merchants

to effectively plan their store resource allocation, reformat visual merchandise displays and manage real-time product inventory.

Statistics and data such as daily transactions are also analysed to further shed light on consumer behaviour. The shell for this pop-up store structure is available for rent and it ranges from SG$50,000 to SG$100,000, depending on the duration and interior fit-out of the pop-up structure. The price does not include the rental of the space from the mall and such.

6 a d verti s i ng + marketi ng | O C T O B E R 2016

Diageo signs up DAN Diageo concluded its global media review, picking Dentsu Aegis Network (DAN) for the job. The network will handle media in North America, Europe, Latin America and Southeast Asia. Meanwhile, Mindshare will oversee India and South Africa, and Mediavest will handle the Australia market, global media outlets state. The pitch covers major Southeast Asia markets and involves brands such as Guinness, Smirnoff, Johnnie Walker, Baileys, Singleton, Haig, Ciroc and Benmore.

Disney’s new unit The Walt Disney Company Southeast Asia formed an integrated media networks organisation, called Disney Media Networks. The new unit combines all of Disney’s channels, media distribution, games, apps and Maker Studios’ businesses, but excludes ESPN. Disney Media Networks will work with platforms, broadcasters, telcos and digital media to provide best-in-class content tailored for audiences across the region and accelerate opportunities across mobile and social platforms.

Kate Moss lends star power British beauty brand Charlotte Tilbury launched an innovative virtual reality experience starring the iconic and globally renowned supermodel Kate Moss. It was its latest element in an extensive global campaign from the wellknown make-up artist celebrating the launch of her much heralded debut fragrance, Scent of a Dream.

The dazzlingly and beautiful VR experience was created in conjunction with Happy Finish, and film director Antoine Wagner.

New brands for Erdos Mongolia’s luxury brand Erdos Cashmere Group launched two new brands – Erdos and Erdos 1980. Ogilvy & Mather helped develop the strategy for their communications plan, while Brand Union, a WPP Group company, designed the new visual identity. Two new campaigns created for the brands included an Erdos brand story video and the Erdos 1980 autumn and winter key visuals.

A new identity Online food delivery startup Deliveroo revealed that it underwent a major rebrand which saw Deliveroo’s original logo – a kangaroo holding a bag of food against a teal backdrop – replaced with a more minimal graphic symbol. The logo is featured on the company’s new app and website. Branding agency DesignStudio was picked for the project – the same agency that rebranded Airbnb in 2014.

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NEWS

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Samsung halts Note7 sales Samsung Electronics halted sales of its Galaxy Note7 smartphone in September and prepared replacement devices for phones already sold after reports of problems with its battery cell. While announcing the recall, Samsung estimated the problem affected only 24 in a million devices, which is roughly one for every 42,000 sold. An investigation was launched to know what and how to fix the problem.

A positive impact About 63% of people think the launch of Netflix in APAC will have a positive impact on the media industry and Pay TV operators as it allows more competition in the industry and it will trigger a better quality of service provision, according to a YouGov report.

Launched in APAC earlier this year, Netflix still needs to catch up as only 11% of respondents have subscribed to the service.

AirAsia helps GE Three of AirAsia’s Airbus A320s sported General Electric’s livery and colours, as part of the American conglomerate’s bold corporate branding exercise. The campaign targeted primarily the Malaysia and ASEAN markets.

AirAsia recently announced a US$2.7 billion order of 200 more CFM LEAP-1A engines to power its 100 new Airbus A321neo aircraft. AirAsia said the tie-up was also a reflection of both companies’ long-standing relationship.

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AUDIT WATCH

BEING TRANSPARENT

Out of the box Microsoft’s Xbox purchased Beam, a Seattle-based interactive live-streaming service, which gives viewers the ability to watch and play along with their favourite game streamers in real-time. With this new deal, Microsoft hopes to strengthen its Xbox social capabilities. It aims to utilise the interactivity of the platform to easily allow streamers to enable and customise, and is designed to work with any game.

Deliveroo raises US$275 million Deliveroo, the on-demand food delivery service, raised US$275 million in its series E investment.

Since its series D round in November, Deliveroo has achieved an over 400% growth and reached profitability in a number of its established markets. The new funds will be used to expand the service in both new and existing markets, plus for further investment in projects such as RooBox, a remote kitchen initiative.

Don’t limit yourself Nike’s latest spot “Unlimited You” shows how athletes can achieve even greater heights by not listening to anyone, but themselves. The two and a half minute film was created by Wieden+Kennedy Portland and narrated by actor Oscar Isaac.

It features cameos by athletes such as Kevin Durant, Mo Farah, Neymar Jr, Nyjah Huston, Serena Williams, Su Bingtian and Zach LaVine.

such as blogs, debates and audio/ video programmes are available on its website.

“Auditing allows us to make good on our commitment to providing transparency for The Economist’s advertisers and stakeholders. With auditing, we reassure clients that their investment is competitive; and provide a better view of The Economist’s audience and the content they consume,” said Tim Pinnegar, managing director for Asia at The Economist.

He added the onus was on the publication to clearly explain its cross-platform strength to clients.

The Economist worked closely with the team at the ABC to produce the new World Brand Report; capitalising on its accredited data to provide a global view of its digital and print circulation.

“This collaboration puts The Economist at the leading edge of auditing in our industry,” he added.

The Economist is a weekly publication with a regional readership. It has a print circulation of 98,862 and is distributed in key Asian markets such as Singapore, Hong Kong and Malaysia.

The publication was founded in 1843 and aims to lead the debate in the pursuit of progress around the world by providing actionable insights that connect the dots between business, politics, technology and culture.

The paper covers politics, business, science and technology, and books and arts, concluding each week with the obituary. In addition to the web-only content

The miracle worker A dramatic video campaign created by Grey Group targeted the Asian market for the launch of Pantene’s new treatment conditioner “3-Minute Miracle”.

Pantene aims to play a more meaningful role in women’s lives today and to establish this, the agency built the “world’s biggest blow-dryer” to maximise the miracle effect. The campaign highlights the conditioner’s unique characteristics and how blowdrying can be damaging for hair.

Game on WPP’s branding and design agency Brand Union Singapore partnered International Table Tennis Federation in developing a new format of the sport called “Table Tennis X”. The challenge will be a completely fresh take on the sport of table tennis and create an overall brand identity and experience to drive youth participation.

Indonesia calls on Jack Ma Indonesia asked Jack Ma, chairman of China’s Alibaba Group, if he can act as an adviser in boosting the growth of the country’s emerging e-commerce industry. A steering committee will be set up consisting of 10 ministers for which Ma has been asked to be an adviser.

Ma became one of Indonesia’s top investors after acquiring a controlling stake in Lazada Group earlier this year for US$1 billion.

A new influence Mobile adtech company Glispa Global Group launched Voltu, a performance-led social influencer network for mobile acquisition.

The new offering will connect advertisers with influential content creators to drive app installs, brand awareness and engagement. Glispa has been running bespoke social influencer ad campaigns with significant ROI for more than three years.

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NEWS ANALYSIS

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GALAXY NOTE7 RECALL: WHAT CAN SAMSUNG DO TO REGAIN CONSUMER TRUST? The brand spent years and a hefty amount of marketing dollars to compete against the likes of Apple. Will this setback really shove it down the rabbit hole? Venus Hew writes.

Hitting a low note: The recall of the Galaxy Note7 has put Samsung on the back foot with customers.

Unless you have been living under a rock, you would have heard about the Samsung fiasco for its latest Galaxy Note7. The timing couldn’t be worse as arch-rival Apple was also busy gearing up to lock in pre-orders and arrange shipments of its latest iPhone 7 and iPhone 7 Plus models.

The South Korean tech giant took another blow when its shares fell about 11% over the first two initial days, the biggest decline since 2008 as investors took a defensive stance over its latest recall. That also meant, a loss of US$22 billion in market value.

The situation was an unfortunate one as the brand has over the years worked hard to win over consumers in both global and regional markets.

Once seen as just another Android player in the smartphone space, the brand invested heavily in its marketing tactics to be seen as a viable competitor to the iPhone.

Nick Foley, president of Southeast Asia Pacific and Japan for Landor, said Samsung had done well in building trust over the 8 a d verti s i ng + marketi ng | O C T O B E R 2016

past five years, especially when it came to luring the younger generation into buying its smartphones. But unfortunately, Samsung’s latest recall will definitely have an impact on the trust and credibility of the overall Samsung brand in the short to medium-term, he said.

“The thing about trust is that it takes years to build, but can be gone in seconds,” he said.

Joseph Baladi, chief executive officer of BrandAsian, agreed with Foley on the negative effect the recall would have on consumer confidence for Samsung.

“All the mobile phone brands share several common points of parity: convenience, reliability and safety. Of the three, it is the latter that has been most severely compromised.

People who are concerned about their own safety and particularly those of loved ones (like parents with regards to their children) will think twice about the brand moving forward,” he said.

Moving forward In Malaysia, Samsung is urging its Galaxy

Note7 users to power down their devices and exchange them for new units under its replacement programme as soon as possible.

Customers who have Galaxy Note7 devices can replace their current device with a new one beginning 29 September onwards.

In a statement dated 11 September, DJ Koh, president of mobile communications business at Samsung Electronics, said: “Our number one priority is the safety of our customers. We are expediting replacement devices so that they can be provided through the exchange programme as conveniently as possible and in compliance with related regulations.”

Samsung Malaysia said there had been only a small number of reported incidents, but it was taking great care to provide customers with the necessary support. It also identified the affected inventory and stopped sales and shipments of those devices.

Foley said the most important thing that any brand could do when this kind of (recall) event happens, was to be candid and truthful to its customers.

“Don’t try to hide, be honest and tell them what you’re doing to fix the problem.”

Baladi added that Samsung would need to directly address the problem in its advertising and “explain why the explosion took place and how they have solved the problem or are in the process of solving the problem”.

He added the brand would also need to apologise for the risk the phones created to the safety of its customers.

He said that if in cases where the exact cause of the issue remains unknown, Samsung should also “need to strongly advise customers to cease using the smartphone” and it must move quickly with a credible and transparent explanation.

The Galaxy Note7 was launched on the 19th of August in 10 countries and opened for pre-orders in Singapore a little later.

However, at least seven airlines, including Singapore Airlines, have banned passengers from switching on or charging Note7 phones on their flights.

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NEWS ANALYSIS

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FACEBOOK IS NOT A ‘MEDIA COMPANY’, SAYS ZUCKERBERG What does the industry think of that statement? Vivienne Tay finds out.

Staying true to its roots: Despite conjecture, Mark Zuckerberg says Facebook is not a media company.

Facebook CEO Mark Zuckerberg claimed the social media platform will not become a media company and will remain a technology platform.

According to Reuters, Zuckerberg said the company had no ambitions to become a content provider. This was in response to a question asked during a town hall Q&A in Rome, where a member of the public asked if there were intentions for Facebook to become a news editor.

Zuckerberg acknowledged the role it currently plays in giving users access to news content through its platform. However, he added that as a technology company, Facebook creates the tools, but does not produce any content.

But the question many seem to be asking is that in today’s world do you necessarily need to create original content to be seen as a 10 a d verti s i ng + marketi ng | O C T O B E R 2016

media company? After all, Facebook has long been seen as a leading go-to source when it comes to the public’s content consumption needs.

Prashant Kumar, formerly the president of IPG Mediabrands in Asia and current lead at Entropia, said as a long-time media industry practitioner, he would see Facebook as a media owner because ads can be bought and sold on the platform. But how consumers see Facebook is definitely different from how B2B industries and advertising industry players see it, he added.

“Our industry sees Facebook as a platform which we can buy and sell services to,” he said.

But at the end of the day, Facebook, unlike Google which has its own army of content creators, does not own any original content.

“When you see a post from a friend on Facebook, you don’t say Facebook created the

video. You attribute it to your friend,” he said. He added that in the traditional world, content was used to draw in eyeballs and aggregate people. The two were closely tied. But today the content creation role is different from the audience aggregator role. As such, there is some truth to Zuckerberg’s words.

Chloe Neo, managing director of OMD Singapore, said when it comes to defining what a media company really is, it is not just about the creation of content, but also how that content is being disseminated.

She said: “Since Facebook has been increasingly used by people as a communication and dissemination platform, I can see why people who are not as familiar with Facebook, its vision and evolution, would say it is a media company.”

She added this misunderstanding might be further exacerbated because Facebook went into selling ad spaces as a means of commercialisation of its technology.

Like Kumar, however, she was of the view that in the industry, Facebook was still seen as a technology partner rather than a media company.

“Although Facebook has come a long way and evolved into an entity which may have similar functions to a media company because of the convergence of communication and technology, it has clearly defined itself and remained true as a brand and a technology company, and that is how it started out and continues to evolve,” Neo said.

Meanwhile, the social media giant also said it would be using specialised software to show adverts to desktop users who have installed ad blockers, as ad-blocking begins to threaten the social network’s advertising revenue.

It would also be updating its ad controls to allow users to specify ad preferences to increase relevancy value to advertisers. Many have deemed the move “bold” given the social media’s strong stance on this matter.

Recently, Facebook-owned Whatsapp, a messaging app, announced plans to share user data with its parent company, including phone numbers, as part of plans to allow businesses to send messages to users.

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HEINEKEN’S GRAND PLANS TO PUSH THE BOUNDARIES OF FORMULA ONE Heineken is already looking at a new formula for F1 advertising. Rezwana Manjur finds out more.

Last month our neighbours next door, witnessed a jam-packed action-filled Singapore Grand Prix weekend.

The annual event saw various global marketers congregate in the city, and amid all this, we caught up with Heineken’s global senior brand director Gianluca Di Tondo.

Di Tondo and his team over at Heineken inked an international deal with Formula One Management (FOM) in June this year, which saw the global beer brand become a sponsor for Formula 1 globally. The two have inked the deal which is set to run until 2022, unless of course, “things don’t go in the right direction”, then there is an option to opt out by 2020, he said during an intimate media session.

However, he added this was highly unlikely given Heineken’s track record when it comes to its other sponsorship deals such as with UEFA and the James Bond 007 movies.

“If you have a deal for two or three years for a sponsorship, you get nothing out of it except a little bit of visibility. From our experience, we see the need to stay together with our partners to maximise the value of the sponsorship,” he said.

The real magic lies in working together to iron out the kinks. As part of the global deal, from the 2017 F1 season onwards, Heineken will also be known as the F1 event title partner of three Formula 1 GPs. It will have a significant presence at several additional F1 events chosen

by Heineken and Formula One Management.

The Singapore GP, he said, was clearly one of the GP events the brand hopes to get its claws into given the success of the event, the ease of logistics and perks of the location.

He explained plans were already underway for the Singapore GP to see more Heineken branding of the track.

“Singapore is one of the few markets that leveraged the F1 event fully after Monte Carlo,” he said. However, not all markets are able to exploit the circus-like feel of the event fully.

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The race to stand out: Heineken is hoping to inject more excitement into the Grand Prix.

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the largest global properties and yet, it is still largely under utilised by brands,” he said.

“We saw immense potential to come up with innovative ideas and an active partnership.”

Stating the discussions were ongoing for almost five years, he explained the key to signing the deal was evaluating what more could be done with the existing assets to “make it sweat harder”.

“This is something we were discussing quite a lot with F1 before signing the deal. We had to ask if they were open to us challenging them in new ways because F1 is known to be a

“We had to ask if they (F1) were open to us challenging them in new ways because F1 is known to be a little monolithic in its approach whereas we are known to be more demanding” little monolithic in its approach whereas we are known to be more demanding,” he said.

Largely, the partnership will see activations that include F1 circuit branding, TV commercials, digital activations, live fan experiences and events, dedicated PR initiatives and packaging/ point-of-sale activations. However, he explained simply slapping banners at the side of the track and putting in a corporate partnership was not Heineken’s style.

“We have to work together to figure out how F1 can draw in more viewers and on our side, how we can inject some excitement and make the event even bigger,” he said.

In terms of what Heineken hopes to get out of the deal, he said every sponsorship deal was different – be it in terms of branding the track, route or regulations put in place.

At the global level, he explained, the tie-up with F1 helps Heineken with its awareness of the brand and pushes its premium positioning.

In certain markets, the brand hopes to get a sense of “closeness” to the consumers.

When asked if the brand was looking to target a different audience with the sponsorship, he said no, but rather, said the partnership “is in line with Heineken’s overall growth strategy”.

As a company, Heineken believes in growing its brand via penetration.

“For alcohol brands there are two routes to take to the top, loyalty and penetration. Loyalty looks at hooking the consumer in and then keep them drinking. But what we want is to promote responsible drinking,” he said.

Safety first Currently, central to the partnership is the fully integrated global F1 “Open your world” manifesto and “When you drive, never drink” campaigns. Currently, Heineken invests 10% of the brand’s global media spend on dedicated responsible consumption campaigns such as “Moderate drinkers wanted” and “Dance more drink slow”.

The drinking responsibly message will be further articulated through the branding.

The brand even went as far as to create a daring new logo for it.

In Singapore, 30% of the brand’s visibility of the track will be dedicated to pushing the “When you drive, never drink” message.

“We have been testing this logo with three different agencies and all three of them asked us not to do it. They said consumers will read it as us asking them not to drink Heineken. And that

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is exactly the message we wanted to push. We would rather someone not drink at all if they are driving.” He explained tying up with F1 gave the brand further credibility and authority to discuss a specific issue. It even went as far as to creating a logo asking consumers not to drink its beers.

Marketing in the dark Asia, as we know, has several dark markets such as Indonesia and Malaysia where screaming out a beer brand’s marketing message is not always appreciated. We asked Di Tondo how he deals with these markets.

“The beauty of dark markets … there is not just one degree of dark,” he said. As such the dark markets in Asia also vary. While it is traditionally thought that when markets go dark, social spend increases, he argues this is simply because social is the last to get hit.

“Regulators start from the traditional TV, print, OOH and then go onto social. And the world of social itself is complicated. Sometimes regulators in the markets themselves don’t know the rules on social,” he said.

“We try to play by the rules, but sometimes even the rules themselves are not clear.”

Meanwhile, when a market is really dark, the spend increases in the BTL space. That is the best way a brand can keep communicating with its consumers.

Embracing new technology While embracing new technology is high on Heineken’s priority list, he is cautious about the marketing stunts the brand pulls when incorporating these new digital toys.

He added that embracing new technology such as virtual reality was not a matter of “if”, but rather a “when” for the brand. And this will most likely be in 2017.

“It will happen when the technology is ready enough to carry the brand message. We are trying new things and F1 can be an interesting space for VR and we are thinking of how to shoot a campaign in VR. But we are not there yet. We have a lot of projects we are planning, but at this moment none of them are close enough to be released,” he said.

He added scalability was a huge factor for beer brands, and that’s not ready yet.

“Beer is a business of scale. Once in a while, you can have a nice project to pilot new gadgets. But if you want to make it a standard, it has to scale.”

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RETAIL WOES: WILL FREEZING NEW MALL LICENCES SOLVE ANYTHING? The proposal by the Malaysia Retail Chain Association (MRCA) has got the industry talking.

Is it a viable long-term solution? Venus Hew explores.

The proposal of the Malaysia Retail Chain Association (MRCA) announced in September – that it would be temporarily freezing issuing licences for new shopping malls – has stirred up much discussion within the local retail scene.

MRCA, which represents more than 300 retailers in Malaysia, covering more than 20,000 outlets, said its intention was to curb the oversupply of retail space.

Valerie Choo, MRCA’s deputy president, said the rising number of shopping malls in the next two years would strain the retailers’ margins. She added that many retailers had been impacted by the economic slowdown, with the weakening ringgit also leading to a rise in overhead costs. She estimated an over 50% increase in shopping mall space once the new shopping malls were ready.

The news also came amid the announcement the Malaysian retail industry recorded a lower-than-expected growth rate of 7.5% in retail sales for the second quarter of this year, according to the Retail Group Malaysia. But the question remains on whether freezing licences will really solve the impending problems.

Due to the current prolonged soft economy, various weather and security-related events, the retail sector has already suffered from both domestic and tourist consumption, said SueAnne Lim, chief of group insights and strategy at Dentsu Aegis Network Malaysia.

She added that to maintain targets, retailers were often forced to discount to stimulate sales.

Quoting a recent report by Dentsu Aegis Network’s proprietary Consumer Connection System, she said more Malaysians were also holding back spending, preferring to entertain at home, along with a sportier active lifestyle now part of the top 10 trends, in responding to a challenged economy.

Andrew Crombie, CEO of Southeast and North Asia at Fitch Design, doesn’t think the proposal of freezing these new shopping mall licences will really solve the current issues faced by the retail sector.

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Overreach: Not everyone agrees on the decision to freeze issuing licences.

approach retail space development from a developer’s perspective. There is not enough consideration given to fully understand the consumer mindsets and how best to match them with desirable retail offers,” he said, adding that starting with a deep understanding of the consumer was fundamental.

“We believe a blanket freeze may not be the best approach. Not all geographies or consumer segments face the same overload. A more targeted solution may be required.”

Lim agreed with Crombie and said it would bode well to bring innovative concepts to retailing.

“Rather than developing cookie-cutter malls with a similar line-up of brands, mall operators should look at creating products and services that cater to a more unique audience, and deliver a more unique service by understanding consumer-changing lifestyle trends and needs, as well as global examples,” she said.

“Instead of curbing retail development entirely, could we use these insights to build a unique mall concept that caters to people’s

changing lifestyles and continuously provides them a higher quality of life?”

Meanwhile, Crombie also said that although the rising e-commerce was a key component of the new retail industry, bricks and mortar retail sales still accounted for about 90% of all retail sales.

“While e-commerce in Malaysia is growing at a compound annual growth rate of 24.3%, it is unlikely to surpass physical channels in the foreseeable future as user penetration is only 58%,” he said.

The real impact for retailers, he said, would be in how they embraced e-commerce and what role it would play in them satisfying their consumers wants and needs.

Too often, discussion around retail stimulation was focused on fiscal factors and tools.

However, he said, as all the great brands have proven over and over, a powerful and exciting brand offer and consumer experience will drive demand irrespective of the prevailing economic conditions.

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HP’S CMO DEMANDS MORE DIVERSITY: SHOULD MORE BRANDS FOLLOW SUIT? The embarrassing truth is that more and more clients are now demanding diversity from their ad agencies. Vivienne Tay writes.

Antonio Lucio, chief marketing and communications officer at HP, issued a letter to the company’s agencies calling for more diversity in leadership roles.

According to the letter shared with A+M, he wants formal plans to be created for agencies to diversify its team.

The plan will need to be executed within 12 months to improve the percentage of women and people of colour in leadership roles in agencies. The move is to align HP better with its vision to make the world a better place for everyone anywhere with technology.

He added HP has invested in programmes to ensure diversity in the workplace by having at least half of its top marketing jobs being held by women. It also created a scorecard to track multiple levels of diversity in its own global marketing organisation.

“As a global company, we need to take a broad view of diversity as increased representation will take different forms in different countries. We have decided to start by addressing women,” he said.

Globally, HP works with a range of agencies such as BBDO, Gyro, FleishmanHillard, Porter Novelli and several others. In Singapore, HP also works with the likes of Goodstuph. The agency declined to comment on the matter.

Meanwhile, another brand that also took a similar stance recently was General Mills which said that agencies pitching for its creative business in the US should have a creative team with at least 50% of women and 20% of staff of colour. We asked several ad industry folk in the region if this was the start of a revolution and if such a mandated move was needed in a diverse region such as Asia.

According to Simon Kemp, We Are Social’s regional managing partner: “The fact that a client needs to ask for this is quite embarrassing because diversity is something that all agencies should embrace anyway.”

Currently, about 75% of We Are Social’s staff are women, he said, adding that if his agency was tasked to handle (diversity in workplace) he would first work with the client WWW.M A R K ET I N G - I N T ER A C T I V E.C O M

Call to arms: HP has issued a letter to its agencies calling for more diversity in leadership.

to understand what exactly they needed to fill the gaps.

However, with good talent already being so scarce, would this in the long run impact an agency’s ability to hire the best person for the job regardless of race, religion or gender?

To this, Kemp said: “You should never hire just to check off a box. That is not going to help you or the client or the employee in the long run.

It is not about the diversity in physicality. It is about diversity in thinking.”

Success based on merit and transparency Jacqui Lim, CEO of Havas Media Group, said at the end of the day, the focus of the matter should be rooted in the qualifications, skill sets and value that an individual can add to an organisation – regardless of their gender.

She added if a clear job scope and criteria for the role is placed at the heart of the selection process, the decision-making process becomes transparent and objective regardless of gender or race.

“Diversity is necessary, but I would see it as diversity in skills, knowledge and experience that can add value to any organisation. Rather

than have prefixed percentages to guide us to ticking the boxes,” she said.

Agreeing with her was Lara Hussein, managing director of M&C Saatchi Malaysia, who added that she was glad the Malaysian government via Pemandu and others have started to provide training specifically to groom female corporate leaders. With those opportunities, the ball remains in the female leader’s court.

She said: “Let women succeed on merit, not by law. Women should not clamour for special treatment, merely fair treatment.”

She also said it was dangerous to focus merely on the top of the ladder, without seeing that discrimination may exist on every rung to the top.

“As someone once aptly put it, ‘we must raise both the ceiling and the floor’,” she said.

“Unless the issue is tackled holistically, then many women will never even come close to the heady heights of the boardroom. Let’s fix every rung. Our top management is about half and half, gender wise. And you know what? I no longer notice. And that’s perhaps the best sign of all.”

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DENTSU-TOYOTA SAGA: A MUCH NEEDED WAKE UP CALL FOR EVERYONE? Rezwana Manjur and Vivienne Tay ask marketers what they think of the Dentsu-Toyota furore and how the system can be changed to make sure it doesn’t happen again.

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“Technology is supposed to make things easier and more transparent, but this isn’t always the case.”

Dentsu president and CEO Tadashi Ishii apologised and admitted to approximately 633 suspicious transactions involving more than 111 clients. Among those transactions, the number of cases where fees were charged while no placement had been made was found to be around 14 and worth about JPY 230 million.

According to the company, all clients involved have been already communicated to and it is not set to affect the company “materially”. This came days after the Toyota saga which rocked the marketing community where Dentsu Inc admitted to claims that its subsidiaries DA Search and Link (DASL) had overbilled long-serving client Toyota for its performance-marketing services.

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AdNews. In a press statement, the agency added that the types of irregularities involving inappropriate operations which it has detected to date, included “discrepancies in advertising placement periods either made consciously or by human error, failure of placement, and false reporting regarding performance results or achievements”. This was on top of invoices not reflecting actual results, resulting in unjust overcharged billings.

“We take this matter seriously and immediately after finding out about the incidents, we organised an internal investigation team in the middle of August. We have initiated extensive investigations to grasp and verify the actual situations, including the root causes leading to the inappropriate operations, and we

are vigorously continuing our investigations,” Ishii said in a statement. The investigations cover those digital advertising services rendered after November 2012 until now in Japan.

“While we are still in the process of pursuing our investigations, if we confirm new facts, we will deal with such new findings in the same manner.”

He added the company was determined to clarify the causes leading to the inappropriate operations and to establish further requisite measures for resolving the situation, along with fundamental preventive measures.

It hopes to “implement such steps faithfully and steadily in order to restore confidence” in the company by the end of the year.

Moreover, following the taking of such steps, the agency now plans to report the progress of its efforts to clients and business partners, including advertisers, related associations and organisations and all other stakeholders.

“We sincerely apologise to our esteemed advertisers, the parties concerned and our shareholders from the bottom of our hearts for causing concern and trouble,” he said.

A DAN representative in a statement to A+M said the case was one which was isolated to its digital operations in Japan.

This is not the first time a media agency has faced such a public issue of falsifying claims or overbilling clients. In 2014, WPP’s Mediacom faced a similar issue for fabricating campaign data in the Australian market which led to several of its other clients reviewing their relationship with the agency. Recently, WPP’s GroupM appointed John Montgomery to a new role of executive vice-president of brand safety for GroupM global.

He worked with GroupM’s community of digital advertising and media trading experts at Mindshare, MEC, Mediacom, Maxus, Essence and Xaxis to create a coherent set of global standards that operationalise brand safety for GroupM’s clients in every market in which they advertise.

Moreover, the shocking news triggered the Association of National Advertisers (ANA) to finally unveil a new set of guidelines to ensure transparency between agencies and clients.

The ANA also commissioned an assessment by K2 Intelligence.

ANA said that marketers were now expected to require media agencies to be fully transparent in their proceedings in order to elevate trust and restore confidence in the agency-client relationship.

It also released a recommended contract template, urging marketers to leverage it as the foundation for master service agreements with agencies.

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Crisis for media agencies?

But are media agencies, who many say have long stolen the spotlight from creative agencies, now having a moment of crisis?

Darren Woolley, founder and global CEO of TrinityP3, said that trust was very important in these relationships, but the new DentsuToyota revelation is proving that trust alone will not protect a marketer from practices which are not transparent. If this can happen to a client relationship which has been seen by the industry as long-standing and significant, it can happen to anyone.

This, he added, was an indication that marketers and advertisers in the region can no longer ignore the issue of media transparency.

He added many marketers here have been quick to dismiss the issue believing it is a problem for the US and Australia, but not an issue for Asia.

“Every marketer in the region now needs to rethink how they are contracting their media agency arrangements to deliver transparency, value and performance,” Woolley said.

He said many marketers go into relationships with their media agency providing total trust for the investment of significant sums of money with little or no regulation or governance around how that money is charged or invested.

“The fact is that media agencies have been charging advertisers less up front in the way of fees for a number of years because they know they can make up the shortfall in other less transparent ways,” he said.

He added simply changing agencies will not be a cure, but rather marketers and agencies need to implement contracts and practices to ensure transparency, performance and value will slowly build trust.

Paul Davies, managing partner at Roth, said in his interactions with marketers, he sees a general continuing trend downwards of trust of agency marketing services generally – not just media. Specifically the issue is centred around a lack of transparency and openness regarding commercials.

“Clearly, the media companies are the ones at the sharp end of this negativity at present. As digital media spend continues to increase, this will not improve until transparency is improved,” he said. Moreover, transparency is hampered by the number of service/technology providers involved in the process of delivering digital advertising.

“The tone and message of the holding company bosses doesn’t help in this regard as we certainly see this as just spin to try and deflect the issues,” he said.

“But clearly marketers have work to do here as well by improving and professionalising the management of the marketing service companies they use.”

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Marketers open up on their trust issues While initially the car manufacturer Toyota did not want to comment on the matter, a spokesperson later came out with a statement to A+M, saying: “At Toyota, we value our relationships with our agencies and other partners. While we are not in a position to provide additional details, we have been notified

by Dentsu of irregularities in some digital media business transactions. We would like to refrain from commenting further at this time.”

Because the waters in that area still remain murky, it has caused several marketers in the region to sit up and rethink their relationship with their agencies given Toyota’s long-standing history with Dentsu.

In a conversation with A+M, Juliana Lim, senior marketing director of KFC Singapore, said the Dentsu Toyota revelation does in fact make her uncomfortable “to a certain extent”.

She said while the brand does track overall performance of digital campaigns in-house, a large part of the relationship with its agencies is “based on trust”.

“We take our media agency’s reports mostly on face value,” she said.

“We don’t have a specific performance tracking tool in-house because acquiring programmatic tracking tools in-house is also an expensive matter. The programmatic and digital space as well is constantly evolving.”

Another senior global marketer who spoke to A+M under anonymity, said the move was indeed worrying for clients and advertisers.

He said that with the recent ANA findings, overcharging and fraud in Australia, and now Dentsu overcharging in Japan, “such dodgy practices must be widespread”.

“Technology is supposed to make things easier and more transparent, but this isn’t always the case, particularly when it comes to areas like programmatic,” he said.

He added that while he hasn’t actually felt or found evidence of being overcharged for account management, what he finds challenging are the “dubious deals on outdoor placements in emerging markets, the lack of transparency on rebates in big regional deals and in digital programmatic buying”.

“There is a view there that some clients have cut costs to the bone for their agencies, leading them to seek other revenue, but in the case of Toyota they are a company spending billions in a long-term and personal relationship with their agency so there must be more going on,” he said.

Echoing the sentiment was Juliet Yap, marketing director at Carlsberg Malaysia, who said this was a key concern for her because most brands and marketers “did not know exactly where the money was spent, and how it was spent.”

“Agencies shouldn’t be cutting and cutting their costs until they feel pushed into a situation where they feel they need to disguise costs.”

“Often, with the media buying space being a black box, we are not aware of what we do not know,” she said.

Safeguarding your future According to Yap, last year, as part of a global effort, Carlsberg Malaysia carried out a compliance and procedural audit. This has proven to be useful as it has helped in pointing out some areas on how the brand could have greater transparency. However, it is also a costly exercise, she added.

KFC’s Lim added that an audit body could be set up to put a system in place which could call for media and digital media buying audits regularly as well as at random.

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Making the numbers add up: Clients and agencies need to be more honest with each other so both feel they are getting the right deal.

Meanwhile, Decathlon’s head of marketing and communications, Clarence Chew, said self-sufficiency was needed for marketers now as it’s the only way to ensure that such issues will not happen.

“This means that marketers need to limit their exposure to being overly-reliant on outsourcing so many core functions. There needs to be some kind of quality control process to prevent this from happening or the industry would just see a natural death,” he said.

The marketer, speaking under anonymity, said ultimately transparency was the solution and more needs to be understood as to how media is bought and where the money is spent.

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Auditing is one solution, but then marketing may become like the accounting and financial services industries, where regulation is needed or stronger self-regulation sought out.

He also urged for a more evolved relationship between clients and agency partners where agencies would no longer be seen as a “commodity”.

“Agencies shouldn’t be cutting their costs until they feel pushed into a situation where they need to disguise costs. There might be a good template for agencies to follow in the form of management consultants where they don’t drop their pants on cost.

They value their time and expertise and charge accordingly,” he said.

“Agencies also need to take their reputation much more seriously.”

This reputation has been hampered for a while now as agencies are more and more now seen as “flippant with reputation and trust” due to the rise of scam awards. Other reasons also include not investing enough into the hiring of the best and brightest minds (always opting for low-cost resources and juniors until they burn out) and being inconsistent in their costs and the value they bring.

“Both agencies and marketers need to show what they bring to the table, how much revenue they create or how you’re making customers happy and do it in a transparent way and many problems will go away,” he said.

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Art direction: Fauzie Rasid & Teck Lim; Photography: Teck Lim — Lumina (www.animulstudio.com)

HOLDING A DUAL ROLE IN SALES AND MARKETING, IS NOT EASY. HENKEL’S DAVIN LEONG DISCUSSES WITH VIVIENNE TAY THE HARSH REALITIES OF THE JOB.

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“WORKING IN A SMALLER FIRM ALLOWS ME TO CREATE MY OWN LEGACY AS COMPARED TO WORKING IN A BIGGER ORGANISATION, WHERE

THE LEG ACY IS BEING DETERMINED

BY THE ORGANISATION.”

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The beauty segment is cluttered, and globalisation has led to immense competition. To cut through and survive, aggression and focus is necessary. To make matters worse, with the rise of social, every step is scrutinised, and no stone can be left unturned when covering your bases.

Working in the beauty industry is no fairy tale job.

In a conversation with A+M, Davin Leong, head of regional sales, Asia Pacific beauty care, at Henkel, says with a plethora of brands today using cookie cutter approaches to marketing, the field has somewhat become uniformed.

This is ultimately driving consumers to become more impatient as very little actually stands out and excites them anymore.

Sharp, focused and hands-on, Leong likes to roll up his sleeves and get down to business. Before the interview, he was involved in a product demo session. Unlike his previous stints with beauty giant L’Oréal and Japanese brand Shiseido, he thinks this job allows him to leave his own mark behind.

He explains although Henkel is a well-established company globally, its presence in the Southeast Asian region is still small.

“I have a blank canvas in front of me. I am able to paint it, shape it and colour it the way I want,” he says.

“Working in a smaller firm allows me to create my own legacy as compared to working in a bigger organisation where the legacy is being determined by the organisation.”

In comparison with competitors, Henkel Singapore adopts a “startup mentality”, and as such, the brand doesn’t have “hierarchical” layers to go through. The company lacks silos and is able to remain agile.

HAIR CARE REVOLUTION The hair care industry, in particular, is currently undergoing a revolution.

While in the past, a simple hair wash product would suffice, the industry is now adding more dimensions to hair care – incorporating masks, serums and treatments – all driven by consumers demand for variety.

Coupled with the cluttered space and lack of consumer attention, sustaining and the retaining of the customer’s interest is an expensive exercise, he explains. He added that brands to continuously innovate and reinvent themselves.

With a focus on digital marketing, Leong and his team are taking things from the ground-up to bring Henkel’s beauty care brands into the spotlight in the region. He adds that brands needed to invest in the right marketing tools to reach consumers in the spaces they are present in.

Rather than constantly trying to draw them in, brands should ideally weave themselves into the conversation.

He says brands need to be reachable to their customers, so they are able to provide the targeted one-on-one communication that consumers seek.

“It is not just about winning and recruiting consumers, but rather turning them into brand advocates. Only then are we able to have a business that is considered sustainable,” he says.

How the company is trying to practise what it preaches is by creating an AskSchwarz forum for its Schwarzkopf brand. The forum provides consumers the opportunity and the space to not only engage the brand, but it also gives them the opportunity to ask some really tricky questions about hair.

“We want to be the first ones for our consumers to turn to when they have an issue with hair care or products,” he says.

Although a digital-first strategy is something new for Henkel in Singapore, the brand has made digital efforts in China where the e-commerce business has taken off. Today this represents about 35% of the business in the market. However, he views the whole notion of digital marketing to be a bit overplayed in the industry.

“Digital is the new norm. It implores us to adapt quickly to what consumers want, and at the same time, allows us to share what we stand 2 2 a d verti s i ng + marketi ng | O C T O B E R 2016

for as a brand. But while everyone talks about wanting to get into digital marketing, do they actually fully appreciate and understand what it really means to be digital?”

While he does not claim to have all the answers, he warns that digital marketing can get scary quickly as it is no longer possible for brands to hide from consumers because of the widespread availability of information and communication channels.

This is where the right agency partner steps in, he says.

THE RIGHT PARTNER In the case of Henkel, boutique agency Mill Sterling was chosen to handle creative and digital duties as it was able to promise the focus the brand required. When asked why he prefers working with smaller agencies, Leong says while network agencies have more experience, networks and resources, some of the drawbacks include a lack of creativity.

“Some of the struggles we face with bigger agencies is how they apply similar approaches. It may be the easiest answer, but it may not necessarily be a feasible one. We really want to be a little bit different and have a sustainable approach in how we engage our consumers. When you are in a competitive field like ours, especially in such a cluttered field, you can’t adopt a ‘me too’ approach.”

He adds the company was looking to find an agency with similar work ethics and values to Henkel’s.

Drawing from his personal past experience as a marketer, he adds there are still struggles in the agency-client relationship, a lack of focus being one of them.

“Agencies at the end of the day are still tied by profit and loss, hence, they will always be on the lookout for new businesses no matter how big or small they are in size,” he says.

And while the right agency partner is necessary, what is even more necessary is for a client to be a good marketer who is future-ready to survive in a volatile, uncertain, complex and ambiguous consumer environment.

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Getting in with the cool crowd

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Millennials really do stand out.

They elude and confuse marketers. On one hand, they are extremely loyal to the brands they truly trust.

On the other hand, they are always after the best deals. J&J, Sephora, Mondelēz and several other top brands discuss how to effectively communicate with this generation.

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Taking age-old marketing tactics to a whole new level Couponing, it’s been around for ages.

Here’s how The Coffee Bean & Tea Leaf Company embraced digital to resonate with the Millennial crowd.

Rezwana Manjur and Monisha Rao write.

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For its 20th anniversary, The Coffee Bean & Tea Leaf company decided to take its traditional coupon-based on-ground promotions online.

While the company for a long time has handed out coupons to patrons in various locations, at the start of the year it decided to put an end to this age-old tradition.

Three months ago it decided to gamify this whole process.

Working with its digital agency Happy Marketer for a period of four months, the two created a digital redemption system where consumers could simply head online to a designated microsite to redeem The Coffee Bean & Tea Leaf goodies.

Called “Spin the Bean”, the website was created primarily for those on the go and was mobile-optimised to make it more convenient for today’s mobile shoppers.

With a relatively simple interface, users could tap on a button on the site to spin an electronic wheel and receive rewards.

They would then get an email confirmation of the reward they had won which could easily be redeemed at any of the cafes around the island. Staff at the cafes were also trained to help in the redemption process at the POS terminals.

“The whole plan was to better integrate the online and offline world and drive retail sales,” said Prantik Mazumdar, managing partner of Happy Marketer.

The agency also created a back-end dashboard system which allowed the company to alternate its rewards and push to the front line its new products. As such, the items always remained fresh.

According to Doreen Lim, director of sales and marketing for The Coffee Bean & Tea Leaf, the coffee chain said the unknown element of surprise and gamification was what drew customers back to the site.

A web app also helped as it didn’t result in another dormant app on the mobile device and the brand was also able to identify and profile its customers on social media in real-time.

Moreover, launching a browser-based web app also allowed the company a speedy rollout and quick bug fixes. The ease of use and a frictionless method to redeem the rewards, said Lim, was also vital in luring users. This incentivised consumers to interact with the brand on digital over and over again.

And, of course, rather than using “push marketing” tactics, and relying on paid media, this particular campaign had a pull factor.

Initially the company promoted the new loyalty system by sending an eDM alert to the 50,000 users in its data base. In terms of paid media, Lim said the company spent about SG$100 for Facebook promotions.

Following which, word spread about WWW.M A R K ET I N G - I N T ER A C T I V E.C O M

Cutting through the digital clutter E-commerce is a cluttered space with almost every other retailer going online to target Millennials. But the online world itself is no longer just about the survival of the fittest, but rather it is about the smartest and the boldest. To stay afloat in such a highly cluttered space, out-of-the-box thinking is needed.

Retailers online cannot be afraid to experiment, said panellists during a discussion at the Millennial 20/20 Summit. Jill Standish, senior managing director of retail practice at Accenture, said experimentation today was a must given how fast the face of the e-commerce industry was evolving.

“Every consumer is a little bit different. If I were a retailer today, I would want to do fast experiments and try something new. If it works then great, otherwise shut the project down,” she said.

But the real problem arises when retailers forget to measure the success of their experiments.

“There are retailers who think that a concept is cool and keep rolling it out without measuring the profit it brings to the business. People in the future are going to question how your experiment increased traffic, sales and conversions around the brand. So you need to know what metric did it help increase,” she said.

If you are going to experiment, go ahead and measure it before and after. She added that technology has brought about a change in buying behaviour of consumers. This ensures the retailers are always on their toes to come up with fresh ways to reach more consumers.

Rashi Talwar, head of on-site merchandising and regional marketing at Zalora, said being a young online shopping fashion brand, experimenting with pop-up stores was largely done to grow the brand’s presence regionally.

“We set up temporary pop-up stores around the region once in a while to educate our customers,” she said. But sticking to your core brand DNA is vital. As such, transactions at the pop-up stores were still done through designated computers set up in the stores.

Arguing that visibility is a key factor in gaining brand traction was Suresh Dalai, head of retail merchandise planning at Levi Strauss & Co. At the end of the day, having a touch and feel of your brand helps in creating a personal bond with the consumer and creating an experience.

“Size and visibility is the simplest level of personalisation. Without which, you are lost,” he said.

“Spin the Bean” organically. According to data analysed, the company found that 64% of the respondents were female and 60% to 65% were Millennials.

To date about 600,000 spins have already occurred and the platform has seen an over 55,000 redemption rate, which was an approximate 9% redemption rate, whereas the general rate usually hovers at 1% to 2% and a good redemption hits the 6% mark.

Overall, the move saw half a million dollars in revenue generated.

She added that going digital also saved the company marketing dollars when it came to printing coupons and new offers. This also cut

additional labour costs. On digital, a simple click on the back-end system means new rewards being offered to consumers.

“Driving engagement need not be long, tedious or expensive. The cost of the microsite was not exorbitant. In fact, it is an asset you can use for a long time,” she said.

She added most visitors to the store would also ultimately purchase other products – so there was upsell and cross-sell at the store.

“Of course, there are those who will come and get the free drinks, but a majority will upgrade. Ultimately our goal was to increase footfall which this did. The cost of discounting was far less than that of upselling,” Lim said.

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What beauty looks like in the eye of the Millennial Embracing diversity is one way. Vivienne Tay writes.

With such a plethora of beauty brands pushing their offerings to consumers, cutting through the clutter can prove to be quite challenging, be it digitally or on the ground.

While some brands may struggle to win over the hearts of consumers, Richa Goswami, head of digital at Johnson & Johnson APAC, highlights the simple fact that winning over the Millennial beauty consumers lies in understanding who they are.

“The truth is, if we don’t care about the Millennials and what happens to them, they have no reason to care about a brand that tries very hard to matter,” she said.

She said what Millennials care about is a sense of community and a want to be part of something bigger than them. Millennials want to be around people who have the same passions and interests, she added.

With the widespread availability of usergenerated content, be it through forums, YouTube beauty “gurus” or beauty blogs, it is not hard to see the impact beauty communities have on purchasing decisions.

“This is where it becomes important for brands to start engaging in these communities and with their influencers,” she said.

Embracing diversity is also an aspect which Millennial beauty consumers have shown an interest in because of globalisation.

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Globalisation has led to a growing trend of Millennials trying out products which are relatable on an ethnic front. Giving an example of the Indian market, she said J&J’s Clean & Clear started marketing natural skincare ingredients such as rose water and lemon for its face washing product. These ingredients are common to most Indian households when it comes to natural doit-yourself skincare remedies.

“Having products which are relatable to one’s culture is where you have to be in order to make embracing diversity part of the brand ethos,” she said.

She said along with a freedom of choice and a want to be entertained, Millennial beauty consumers are also discerning, hence, an honest conversation with consumers’ is vital.

Alexis Horowitz-Burdick, managing director at Sephora Digital, thinks Millennial shoppers should instead be viewed as individuals who exhibit traits which are typically “Millennial”.

More often than not, they are clumped and seen merely as an age group.

“A 25-year-old consumer is not dramatically different from a 50-year-old consumer,” she said.

The only difference between the different age groups one should be considering is the different touch-points; one might have more money than the other and also have a different

path-to-purchase. One of these touch-points is mobile. “The role of mobile in a consumer’s lifestyle has become so pervasive to a point that a consumer’s mobile device is now an extension of the individual,” she said.

What this means for marketers is the mobile phone is now one of the first touch-points for the consumer. While being in-store, the mobile allows consumers to search for online reviews of products and also price compare.

Agreeing with her was Goswami, who said that mobile devices, coupled with social media platforms, allow Millennials to be heard. This makes it important for brands to be authentic.

“Along with authenticity, Millennial beauty consumers crave intimacy and experiencebased marketing that is one-on-one. Hence, a one-size-fits-all strategy is definitely out of the window,” Goswami said.

Additionally, the increasing role of mobile demands a smooth transition from online to offline, which needs to be seamless to ensure a more holistic customer experience.

According to Horowitz-Burdick, successful businesses are able to harness an omnichannel approach in their business model.

“What is driving amazing retail or consumer product businesses are those which smartly utilise an omni-channel or multi-channel approach,” she said.

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How do you make an everyday brand cool again?

For Oreo, thin might be the way in with Millennials.

Venus Hew writes.

Many firms have realised the purchasing power of Millennials (aged between 18 to 34) could reshape the global e-commerce playing field. Brands are being forced to constantly reexamine strategies to capture this lucrative pie and keep up with the needs of these digitally savvy and increasingly demanding consumers.

Speaking at the recent Millennial 20/20 summit, the director of e-commerce for Asia Pacific (APAC) at Mondelez, Ganesh Kashyap, explained how and why his company hopes to capture the e-commerce market in China, a country of 1.3 billion people.

He said the Chinese online snacks purchase category is growing at 20% year-on-year, and Mondelez’s online business, including Oreo, is already growing at a much faster pace in the country with its online sales doubling this year.

“In Asia, for our category – food, biscuits and candies – the shift is most pronounced in China, especially with its e-commerce boom,” he said, adding that more than 10% of snacks in China are sold online now.

He also explained how online and offline data in China was helping Mondelez, which is hoping to achieve at least US$1 billion in e-commerce revenues by 2020.

At one point, he said, Oreo was losing market share in China with women between 25 and 30 not consuming the biscuits as they were deemed “too sweet”. To counter this, Mondelez decided to launch Oreo Thins.

But the response wasn’t really great when the product was placed online. But rather than throw up their hands in despair, Kashyap and his team decided to use the insights garnered to create a new campaign to showcase the difference between the original Oreo and Oreo Thins. This drove click-through rates and sales, 3 0 a d verti s i ng + marketi ng | O C T O B E R 2016

and helped Oreo Thins become a US$60 million business in China.

Re-engaging with Millennials However, re-engaging with the Millennial consumers in China is a constant challenge for the brand.

“We knew that Millennials had lost touch with the Oreo brand, and we had to re-engage them,” he said. He added the brand needed to break free of the image of being just another everyday biscuit brand in a grocery basket.

In beefing up its marketing efforts, Mondelez tied up with Chinese e-commerce giant Alibaba in launching a three-day campaign to create a personalised Oreo packaging via digital printing that allowed customers to choose their preferred artwork, messages, icons and colours before placing their orders on their smartphones.

The results, he said, were desirable. Oreo lifted its conversion rate by three times, with more than 40 million re-posts of the campaign on Weibo. He added thousands of consumers also posted positive feedback creating a huge fan base for the brand in a rather tricky market.

Separately, in a recent PwC Total Retail 2016 report, Chinese shopping behaviour is said to have become a leading indicator for global shopping behaviour.

Alibaba’s Single’s Day, a popular 24-hour shopping festival in China, is often compared to America’s Black Friday sales and used as a bellwether for the Chinese e-commerce market.

In 2015, the online sales in China had massively shifted to mobile, said the PwC study. On Alibaba’s Single’s Day 2015, 69% of all transactions were made on mobile devices, up from 43% in 2014. Its online sales for the

same year also came in at $14.3 billion, a 60% increase over 2014.

These numbers resonate with what Kashyap said.

He added Chinese online shoppers were typically young and better educated, with more than 50% of them aged under 30.

Expect more personalisation from Oreo in Asia As for the Oreo fans in Singapore, Kashyap said the company was working on building personalised Oreo offerings for the market – much like the rest of Asia. The market is an important one for the brand.

In mid-September, Mondelez announced it was overhauling and forking out US$65 million to build global research, development and quality offerings. The Singapore technical centre will be one of the first to open, with completion expected in Q1 2017 and slated to be its centre of excellence for gum and candy.

Kashyap added that for brands looking to grow sales online in the Singapore e-commerce market, a differentiated offer with great content that engages people is a must.

Moreover, the personalisation of consumer interactions is also needed.

Comparing the Chinese and Singapore markets, he said the underlying trends were similar, but undoubtedly, there were also several differences. For example, Singapore’s food and beverage purchases online are anchored in convenience such as the relative ease that online ordering and home delivery offers. In China, convenience matters.

But more importantly the consumer is looking for a differentiated range and compelling value.

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LAST WORD

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Did you cry over the iPhone 7 too?

WHY I STILL DON’T HAVE MY IPHONE 7 I really did try, Vivienne Tay writes.

Did you manage to secure an iPhone 7 handset at the official launch in Singapore? If so – the odds were definitely in your favour.

As a Singtel customer trying to please her mother with a new phone, getting hold of a reservation slot for a 256GB iPhone 7 Plus in black was quite a tumultuous task for me. Despite my many attempts, broken website connections and slow loading pages kept getting in my way and in just a matter of minutes, handsets were sold out – in all colours and storage sizes. And I was not alone.

Within hours, angry Singtel customers flooded the telco’s Facebook page and there were more than 2,286 comments discussing the website crash and the difficulties in securing a handset.

While Singtel has not yet responded to A+M’s queries on the matter, it did, however, make consistent status updates on its Facebook page.

It informed customers of the technical glitch, the change in schedule for the handset reservation and also addressed the concerns of some customers in the comment thread.

Singtel was not the only telco to be swarmed with angry comments because of pre-orders. While not facing the exact same problems as Singtel, rival telcos StarHub and M1 received complaints on isolated issues on their social media pages. StarHub faced intermittent website issues and M1 faced issues on stock availability. A+M has reached out to StarHub and M1 for comment.

This led me to wonder if more could have been done by the telcos to cope with the high, and sometimes frenzied, demand of the yearly iPhone launches. I decided to ask some of our industry friends.

Preethi Sanjeevi, regional chief marketing officer and head of consumer insights for VML Southeast Asia and India, said Singtel placing advisory messages and updates on the crash and when the site would be up again was essential. This would ensure panicked customers it was aware of the matter and was looking into it.

“Every organisation is vulnerable to a crisis. It is more vital to assess 3 2 a d verti s i ng + marketi ng | O C T O B E R 2016

the situation post-crisis and implement a response plan than to fret over spilled milk,” she said. Remedying such a situation, she added, is not difficult, but requires advance planning.

In this day and age, where consumers turn to social media platforms to voice their frustrations, it is expected that news of a crisis will spread fastest on platforms such as Facebook and Twitter.

She added that a few angry consumers, however, may not be an accurate representation of consumer sentiment.

She explained it would be better to stress-test the website to find out the limit to which concurrent users can be served without degrading the site’s performance. Site crashes aside, slow page-load times can also compromise on the overall user experience.

Although Singtel was steadfast on a communications front, the fact the technical glitches could still occur for such high-profile launches was not something which was acceptable from a consumer standpoint, explained Prantik Mazumdar, managing partner at Happy Marketer.

“This is the seventh edition of the iPhone and by now the telcos should have had enough chances to learn from their past experiences and be better prepared to manage capacity,” he said.

He added it was unfortunate that in today’s day and age, large resource-heavy organisations were unable to handle website load spikes on their sites during such high-demand periods. This is especially so for launches such as the iPhone as they are predictable, time-bound events that organisations have ample time to prepare for.

Such recurring issues don’t augur well for Singapore’s brand image as a technology hub and they need to be tackled soon.

But since this is a common problem faced by all three telcos, Mazumdar thinks it is unlikely to hurt the sales of the new iPhone 7.

“It’s high time these companies take a leaf out of the books of Amazon, Flipkart, Alibaba and TaoBao that are able to handle far larger e-commerce volumes globally to resolve this issue,” he said.

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