Moving offices is never easy. But when a marketing department decides to move countries, there can be potentially serious ramifications for marketers and the agencies they work with.
Unilever's decision to move 700 staff from Bangkok to Singapore raises the question of how to undertake these upheavals without disrupting marketing strategies and handing competitors a chance to take advantage.
Unilever's decision to move 700 staff from Bangkok to Singapore raises the question of how to undertake these upheavals without disrupting marketing strategies and handing competitors a chance to take advantage.
Some of Unilever's biggest accounts are shifting, including its homecare, personal care, food and ice cream divisions. The goal, says the consumer goods giant, is "to enable a higher rate of innovation and increased competitiveness".
Besides political instability, Thailand has infrastructure issues, poor IT services, expensive telecoms, a limited English-speaking workforce and bad traffic congestion. Singapore's spotless efficiency will ensure that the MNC giant's marketing functions run smoothly, and generous tax incentives will doubtless soften the blow. However, Thailand is arguably the creative capital of Southeast Asia, with Thai creatives in the ad industry winning plenty of awards. The shift therefore could have an impact on the creative aspects of Unilever's marketing. A source claims that creative directors at Unilever agencies such as JWT, Lowe and Ogilvy & Mather are reluctant to leave Thailand, though Unilever insists it will continue to "work with the best talents".
JWT, one of Unilever's agencies, is likely to move 20 senior executives from Thailand and appoint 20 more in Singapore in the next six months. Michael Maedel, global head of JWT, says that flexibility is the name of the game and the agency's employees are more than willing to move. He also denies that the regional team movement will have an impact on the businesses that depend on them. "Even if we are based in Bangkok we can use production companies and directors from anywhere in the world."
Meanwhile, Tony Prehn, CEO of Lowe Thailand, thinks that the main impact on his agency might be on its way of working. Lowe is expected to move about 10 key leadership people to Singapore. "We will operate remotely and we might use more IT for communications and teleconferencing."
However, a source in Thailand says this remote co-ordination could have an impact on the speed with which marketing campaigns are created by agencies. What's more, the shift in account fees from the Thai office to the Singaporean office could have a financial impact on the local offices of both agencies. The upshot is a delicate balancing act for client and agencies between retaining the talent from the original market and setting up teams in the new market.
Unilever is not the first to attempt this sort of relocation. Rival Procter & Gamble made a similar move a couple of years ago when it transferred its Asean, India, Australasia headquarters from India to Singapore. In this case, P&G was careful to ensure a smooth transfer. Its agencies put up a small regional co-ordination team centrally, but agencies in different markets still worked with brand managers based in Singapore virtually and through visits.
Last year, Johnson & Johnson moved its regional headquarters for beauty from Taiwan to Singapore. Its move also did not involve any major movements within its creative agency DDB. The shift involved moving DDB's vice-president and regional director Kim Das from Shanghai to Singapore.
Ultimately, however, Das says remote working will never be a permanent solution. "I am in favour of agencies moving teams with their clients because it makes sense for clients and agencies to be in one place. Eventually, it leads to better relationships."
