Benjamin Li
May 3, 2013

Independence movement: Former big-agency execs discuss indie startups

ASIA-PACIFIC - The past 16 months have seen a spate of former senior executives of 4A agencies and international networks founding independent agencies. What's making so many talented individuals leave the 'comfort zone', and how are they meeting the challenges they face as 'indies'?

A print ad created by Civilization for dajie.com
A print ad created by Civilization for dajie.com

Campaign Asia-Pacific approached some of these ‘new kids on the block’ who started their own businesses over the past two years and asked them about their move, their aspirations and feelings of being their own bosses. They also shared their views on whether big ideas could come from small 'indies'.

Those taking part:

  • Oxford-educated Steve Garton, media consultant for Steve Garton Consulting, founded this year. Formerly executive director of business insights at Ipsos.
  • Desmond So, co-founder of Uth Creative Group (赤子創意) since 2012 (ex-CEO of JWT Hong Kong between 2003 to 2011).
  • Chris Chiu, who worked in the industry for 22 years prior to starting Ren Partnership. During his 11 years with Leo Burnett, he sat on the global creative board, and was the ECD in the Jakarta, Bangkok and Singapore offices.
  • Georgeana Fung, founder and CEO of Etymon & Brand Management Consultants. Formerly the CEO and Market Leader of Burson-Marsteller Hong Kong.
  • Andrew Lok, founder of Civilization in Shanghai (ex-ECD of BBDO Shanghai).
  • Vincent Wu, who has 18 years of experience in Taiwan 4A advertising agencies, including Y&R Wunderman, Euro RSCG and BBDO. In December 2010,  he started an independent ad agency, Millennium Ad with three partners.
  • Kenneth Wan, who co-founded The Bread Digital in 2012 after having spent over a decade in GroupM / Mindshare.
  • Ray Lam, creative partner of Bone Communications. An 18-years veteran of agencies including Lintas, Euro RSCG, JWT, BBDO, Bates, Saatchi & Saatchi, Leo Burnett and Grey. 
  • Stephen Chung, who worked in the advertising industry for four years and is now director of Secret Tour Hong Kong, established in 2012 with  KK Tsang, former GroupM CEO as the investor.
  • Polun Ip, a 20-year 4A veteran whose last post was MD of Optimedia Northern China (2011). Ip founded PowerScreen Connection Marketing (a mobile marketing solution agency) in Shanghai in 2012.
New start-up companies comes and go. How do you sustain your business in the face of competition from international 4A networks?

Steve Garton (pictured right): The strategy is not to try to go head-on with the networks, but rather to partner with them to add insights and context for their clients and pitches.

There is so much information available that often agencies appreciate a helping hand. Mainly, my work is with media owners to help their day-by-day pitches to win advertising campaigns. My promise is to bring new techniques and technologies to the region - adding value is a must.

Desmond So: There are many different reasons why new start-up agencies cannot sustain their business.  Sometimes, they do well and sell the business to multinational agencies; others face financial pressure or the owners prefer to return to work in a multinational agency environment.  I believe owners must be quite determined with a clear vision for sustainability.

Georgeana Fung (pictured below): Market intelligence, connection, relevant experience and reputation are key factors when it comes to agency hunting, regardless of the size. Most of Etymon's staff possess more than 10 years of experience in media and communications from various industries and categories.

Andrew Lok: The pie in China is big enough for all of us to co-exist, especially with the growth of social media.

Vincent Wu: With today's competitive environment, clients pay attention on how to generate effective results from their ad investments. What is most important to them is whether they have found the best talent to work for them irrespective of whether it is an international network or a local independent agency. I have been working with 4A agencies for two decades and our senior partners have the ability to provide clients with efficient and effective solutions which can rank among those of international 4A agencies.

Kenneth Wan: We are not competing with 4As networks. The real competition comes from the scarcity of talents and the fast changing needs of consumers.

We believe what clients are looking for is good products and services that serve their needs but not whether the companies is international or not. All these good services and products only come with high quality of staff. So one of our key business focus is to attract and retain good staff and we are running a unique "333" profit sharing scheme in which we guarantee 1/3 of company's profit to be distributed among the staff.  We strongly believe "staff first business second."  

New independent agencies founded by 4A veterans often have connections with their old clients. So, how would you convince other new clients to pick you in a pitch?

Desmond So: I believe that clients are smart enough to know what they need. They will ask for referrals through their network. As long as the independent agencies are able to do well for their existing clients, they will be referred.  Furthermore, great work always attracts new clients—so the best thing is to do well on your existing clients' assignments.

Steve Garton: My approach is to work with agencies and clients on pitches but not to do pitches. The whole pitching process is hugely time-consuming on senior talent, and I wonder when the day will come for clients to actually pay something to the agencies they ask to pitch.

Polun Ip: Not easy to get new clients. Selling one's bio may help a bit but that's not enough to prove how good a new company is. Previous successes can help in a big way to get the compnay included in the pitch list. Before a pitch is called, it's better to sell your ideas and works  and introduce the company to the client. Fortunately, clients are receptive to new companies in the market and most of them are open-minded and welcome new comers.

Chris Chiu: Clients are getting more savvy and they know what they want and need. They want someone who can provide them with their needs.

Many truly don't care if you're headquartered in Madison Avenue or Chinatown. Especially in today's market where almost all clients have more than one rostered agency. In addition their   requests for proposal (RFPs) are only made every 2-3 years or so.

What they want is a focused team that will partner them. You've got to be one of their pillars as opposed to a supplier. 

I made a conscious effort with Ren not to start with clients from my previous agency.
The idea was more to just put myself out there and see how it goes. As much as the people in the industry move around from agency to agency, clients also move. The industry is small in that way.

I reckon the moral of the story is that "if you keep trying your best in every job every time, people will remember and respect that". 

Georgeana Fung: New clients are always impressed by our track record and strategic mindset, which really helps differentiate us from others. For example, our rich experience in crisis management and brand management (i.e. Hotung Gardens, Laneige, etc) has been attracting a lot of new business clients to us.

Kenneth Wan: Majority of our business are new clients. Word of mouth and referral are key drivers for new clients. Although we did not do much marketing since launch, most new businesses are coming from referrals from existing and old clients. 

Andrew Lok: The work we do for our first few clients should speak for the agency in the future. 

Stephen Chung: We hope to invent new ways for people to interact with brands, above and beyond the products and services. The advertising industry is ever-changing, and being flexible is an advantage for a small start up. In order to gain new clients, we are more willing to try alternative strategies but to punt in more effort in our pitch to clients.

What are the pros and cons of being your own boss?

Chris Chiu: Having your own time is a huge plus. Never been a big fan of 'picking clients'—always felt it was immensely more interesting and challenging to try and convince a reputedly mundane client. I have always met clients face to face and enjoy chatting to them.

Desmond So: It is obvious that you do what you believe is right. You will work with clients who appreciate your services and you can pick the right talents to work for you. It is essential that you do your best for your clients and to make those working in your organization to feel proud of what they do.

Stephen Chung: With ownership, I can have full control of my work, bearing in mind that I was only a copywriter when I was with a 4As agency.

Ray Lam: I would describe my position as similar to one running a private kitchen (私房菜), i.e. we are the cooks and the waiters. 

In the initial stage, I had to handle everything, which I was not familiar with like accounting, office administration or even fixing a printer. After picking up thing slowly I felt like I  had grown to be more 'complete' in the advertising business. In our business, time is important and in some cases more o than money. It saves more time by having a constructive meeting directly with clients andwith the working team. Both clients and us feel happy about it.

Desmond So:  Basically you have to win every piece of business by yourself.  Cash flow is also another concern if the owners do not have enough finance in the bank before they start their own business.  Furthermore, if clients are not experienced enough, they will have concerns and doubts about new start-ups because they may think they are not going to be sustainable.

Kenneth Wan: Not as stable as in international companies with the lack economy of scale. Huge difference in terms of resources & support such as research, marketing, IT…etc, and have high liability on  financial performance.

Polun Ip: Lack of supports like tools application and case references from global networks.

Stephen Chung: Responsibility. I need to be fully responsible for my work. Previously in 4As there are clear divisions of labour: creative, AS, production, traffic. All I need to do is to think of a good idea and execute it, but now I am the gatekeeper of every task in my company: presentation, finance, creative execution, production etc. There are so many new things to learn everyday. I learned to be more focus in my work and I believe that if I do well in my current jobs clients will come to me gradually.

Is there a glass ceiling in 4A agencies for local senior executives? Is that prompting more experienced local agency talents to venture out from the ‘comfort zone’?

Georgeana Fung: I have not noticed any "glass ceiling" for local talents. I myself have done and I found it a pretty fair game. I held senior positions at Weber Shandwick for more than seven years. And then I became CEO and Market Leader of Burson-Marsteller Hong Kong for 3+ years (I believe I was the first locally born and bred leader in BM Hong Kong history) before I started up my own venture. I respect very much those who venture out though as it does take a lot of courage, planning and entrepreneurial spirit in order to succeed.

Andrew Lok: Not anymore. I think local senior executives are fantastic and hold their own anywhere. Look at Oliver Xu, MD at BBDO Beijing or Raymond Tao, president at Ogilvy & Mather Advertising China.

Chris Chiu: I don't think that's relevant anymore. Across SE-Asia, many of the multi-national agencies are run by locals, and successfully too. Look at DDB Singapore for example. The question of venturing out to start your own gig has got to be why you would want to do it. Never because you have got nowhere higher to go. 

Desmond So: When it comes to regional management, the job nature is rather different.  I believe it is always a choice for different individual to consider pursuing the regional path or doing something different with their own belief.

Steve Garton: It is a fact of life that there are only limited senior positions in any company. It depends if a person believes their talents are more marketable outside the agency versus staying inside the comfort zone.

Polun Ip: Most of the quit may not be starting up busines.  For the past few years, for some other reasons like maybe IPO, complete the full media services and …, more and more local ad agencies are willing to pay more to hire the experienced executives to help them to improve their services to clients so that they can compete to 4A.

Surely, digital provides an excellent opportunity and environment to those who want to start up own business (at least the investment capital could be "affordable").

Vincent Wu: In Taiwan, the development of the ad industry is quite matured. Most of international 4A agencies are managed by experienced local agency talents. I think that most of local talents's motivations to venture out their agency is to pursue the journey of their self-actualization. They want to realize their own maximum potential and possibilities. They want to know what they can achieve without the halo of the international agency brand. Therefore, they start up their agency.

Ray Lam: As being a creative talent, the career route would be go highest like group CD, deputy ECD or creative chief, and then the ECD/CEO who will be in charge of the company management. So it comes to a question to the senior creative staff, do you want to keep on doing creative jobs or switch to company management? 

Moreover, the advertising business in Hong Kong has changed a lot by the world economics, globalization, new media and creative definition. Being a senior creative in big agency is not as easy as before, there is even no such ‘comfort zone’ at present. I see experienced talents come out to open their own business in these past few years. The ecosystem in HK advertising is going to change dramatically.

Stephen Chung: What I observe is that advertising labour structure is a pyramid. Definitely not all CDs can be ECD one day.

The most important thing is, as a young creative, I dont really fancy to be the ECD anymore. I always heard about the good old days from my CDs about how ECDs enjoying life and being so rich but nowadays we all work so hard day and night, even with our ECDs.

What I can see is senior CDs in Hong Kong tends to have good bonding their own clients before setting up their own agencies. so safety net is guaranteed. I don't have the client base as they are, so I need to find my own edge to stand out from them.

What advice would you give to other 4A folks/marketing executives who are planning to open their own independent agencies in future?

Steve Garton: Try going to Ocean Park for the day and take the roller coasters. If you can stand that—and better, enjoy the experience—you may be prepared to go it alone.

Desmond So: If you truly believe in yourself, it is worth to try.  Otherwise, better stay in an network agency where you can be covered up by a lot of people.

Andrew Lok: If you have an entrepreneurial nous, the trust of several potential clients, the savings to sit out at least four months without a salary, and the ability to physically suffer intensely for about just as long, as well as a degree of fame in the industry so that young talent are willing to bet their fledgling careers on you, then start as young as possible. The younger the better.

Final words?

Steve Garton: I have worked in media, advertising and marketing for over 40 years and should know better by now. The industry fascinates me and I remain determined as ever to introduce new techniques and technologies into Asia: there is huge scope ahead.


 

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