Asia is finally feeling the ill wind which wreaked havoc on the US
on September 11, shaking the confidence that Americans once had in their
invulnerability like never before.
News of job cuts across the regional media and marketing spectrum are
now flowing in thick and fast. At any time, redundancies are
painful.
But it's more so today when people's psyche - and their confidence as
consumers - has been so severely battered. The talk of returning to
normal - to fly, shop and go about the routine of everyday life - just
seems a little too difficult this time around, especially with news at
press-time that the US has finally retaliated.
Brutal as it may sound, the thinning of agency ranks is one sign that
the region is acting to redress the over-capacity and bloated payrolls
which had been allowed to occur during the boom years before 1997. All
the trimming of fat that occured during the late 90s financial crisis
has to some extent helped agencies here. This time around, the
cost-cutting appears to be far less savage, although the culling has hit
one or two of the international networked agencies much harder than
most.
What is encouraging in this dark hour is that anecdotal evidence
suggests that advertisers are cautious but, unlike the late 90s
upheavals, have not turned off the tap completely. They are still
spending, but they are also demanding a lot more - from ideas to
commitment - from their agencies.
Indeed, it's more than just economic blues or the September 11
devastation which is behind agencies' woes. The bigger issue is the
fundamental shift away from TV-centric campaigns to efforts which
require agencies to ensure advertisers get a decent return on the
dollar. Agencies who survive this shake-up will be the ones who adapt to
the new environment. In Asia, the path is clear. Agencies need to
improve their core competencies, and in doing so morph into specialists,
owning categories in which they have an edge in terms of knowledge,
understanding and best practices.
