Business

Saturday November 7, 2009

Leo Burnett banks on shopper marketing

BY DALJIT DHESI


MULTINATIONAL ad agency Leo Burnett Malaysia, which was named Agency of the Year at the 2009 Kancil Awards last week, is banking on shopper and retailer marketing to put it on a stronger footing in the challenging advertising landscape.

Leo Burnett/Arc Worldwide chief executive officer for Malaysia and Singapore, Tan Kien Eng, says this marketing programme would boost the agency’s revenue and help its clients maintain their brand presence over the long term.

The company will seek resources from its headquarters in Chicago, US, to facilitate the implementation of this programme in an efficient manner.

“Shopper marketing will be one of our core initiatives next year to strengthen our business as many other ad agencies at the moment have not adopted this programme,” he tells StarBizWeek.

“Insights show that shoppers are spontaneous, and more than 50% of them make their final buying decisions in-store. Shopper marketing then looks at the art and science of leveraging retail opportunities to turn these shoppers into consumers.”

According to Tan, advertising via the digital channel is gaining importance in terms of revenue generation for the company.

Currently the digital channel accounts for about 15% of the group’s revenue and it is expected to rise to between 18% and 20% next year.

Leo Burnett is one of the biggest ad agencies in the country, whose major clients include Petronas, YTL, McDonald’s and Dutch Lady.

In terms of Leo Burnett’s strength and differentiating factors compared with other players, Tan said: “The culture here is very much people oriented. And we apply this same humankind approach to the way we engage with our clients’ target market unlike many other agencies that focus purely on branding.”

“Our approach is about understanding people and their changing behaviour. The real measurement for us is when consumers switch to our clients’ brands from other brands in the market,” he notes.

To another question on whether Leo Burnett’s business in Malaysia has been impacted by the economic slowdown, Tan says it has and spending in some areas were trimmed.

The good thing is that this move allowed the agency to learn and analyse the areas which it was weak in and rectify it to boost revenue from existing and new customers, he adds.

Without elaborating, he says despite the tough economic global environment, Leo Burnett is projecting “some growth” in its business this year.

On the challenges facing the advertising industry, Tan says one of the major ones is talent shortage.

“The industry needs people who are thinkers and problem solvers and this is what we still lack. Local universities and colleges should focus more on strategic thinking, creativity and problem-solving rather than merely stressing on passing exams,” he says.

“Companies seeking to advertise should also be bold to accept creative advertisements. For example, back in 1996, Petronas took the bold step of running a Merdeka TV advertisement with an Indian family as the centre rather than the previous trend of using pan Asian faces,” he cites.

Tan says the other daring ad was the recent TV commercial entitled Funeral, directed by the late Yasmin Ahmad (former executive creative director of Leo Burnett).

The commercial, which won one of the two highest awards at the recent Kancil Awards, depicts a woman at her husband’s funeral who, during her eulogy, expresses hope that her children would find life partners who were as ‘’beautifully imperfect’’ as her husband. The commercial was uploaded onto YouTube and had attracted 2.5 million viewers.

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