CAREERS MEDIA: Parames takes helm at AAT aiming to set it up as self-regulating body

The Advertising Association of Thailand (AAT) has elected Dentsu, Young & Rubicam co-chairman Parames Rachjaibun as its new president for the next two years. He said his first order of business was to establish a self-regulating body that would set rates and industry standards. "Right now, we have serious issues regarding agency compensation," he said. "Global media specialists have come in and introduced new payment methods, so we need to update and prepare members for changes to come." According to Mr Parames, the AAT needs to walk a fine line between helping smaller member agencies survive in this new business environment, while discouraging rampant under-cutting in Thailand. Local agencies need to learn more about financial management to regulate costs and set reasonable fees that are fair both to agencies and clients. "Members need to better understand their own costs. Most international agencies prefer to go with fee-based rates, but local agencies still prefer the pre-crisis commission rate of 17.65 per cent," he said. In reality, however, the figure is much lower, and smaller companies were engaged in cut-throat pricing that could damage the industry. Mr Parames said given the current cost structure, agencies could not reduce fees below 12 to 13 per cent; yet some agencies have cut rates below the critical 10 per cent ceiling. The AAT intends to draft a code of conduct with guidelines on rates before the end of the year. Mr Parames admitted that policing Thailand's advertising industry was tricky work. "In the past, we have just been a paper tiger without real authority," he said. "The best the AAT can do is reprimand an offender or complain to the company in question. "Sometimes it worked and sometimes it didn't, but we have to be firm with all members." The AAT currently has 100 active members, whose total billings represents 75 per cent of industry turnover. A membership drive will also be launched to encourage agencies outside the association to join. Mr Parames said the AAT had to act quickly before the Thai government implements a new constitution with articles governing the broadcast and media industries. "If we don't have an established code of conduct, the government will step in and create one for us, and that would be a disaster," he said. During his two-year tenure, Mr Parames intends to standardise training programmes for future generations of advertising executives entering the industry. Even with the current surge in business, there was no shortage of manpower like in Hong Kong or Singapore because two to three thousand graduates enter the Thai job market annually. The AAT will also encourage local agencies to work with clients to create brand communication strategies and not just act as suppliers of advertising campaigns. A sub-committee chaired by BBDO advisory chairman Vinij Surapongchai has been established to research the issue.

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