Staff Writer
Mar 18, 2019

New opportunities in emerging markets: media leaders gather

At a recent roundtable, leading media executives discussed overcoming fragmentation, investing in innovation, and spurring cultural change in the marketplace.

The New Opportunities in Emerging Markets roundtable attendees, (from left to right) Henry Shelley, general manager, Southeast Asia, The Trade Desk, Faaez Samadi, Southeast Asia Editor, Campaign Asia-Pacific, Puneet Arora, chief executive officer Singapore and chairman, Philippines and Thailand, GroupM, Michael Beecroft, chief investment officer APAC, Mindshare, Kasper Aakerlund, president APAC, UM, Deepika Nikhilender, senior vice president APAC, Xaxis  Jonathan Mackenzie, managing director, Publicis Media Precision APAC, Matt Harty, senior vice president, Asia Pacific, The Trade Desk, Regan Baillie, chief business development and marketing officer, APAC, MediaCom, Gareth Mulryan, chief executive officer – Singapore, Publicis Media, Yean Cheong, head of cadreon APAC, IPG Mediabrands,  Isa Cheung, event marketing manager APAC, The Trade Desk
The New Opportunities in Emerging Markets roundtable attendees, (from left to right) Henry Shelley, general manager, Southeast Asia, The Trade Desk, Faaez Samadi, Southeast Asia Editor, Campaign Asia-Pacific, Puneet Arora, chief executive officer Singapore and chairman, Philippines and Thailand, GroupM, Michael Beecroft, chief investment officer APAC, Mindshare, Kasper Aakerlund, president APAC, UM, Deepika Nikhilender, senior vice president APAC, Xaxis Jonathan Mackenzie, managing director, Publicis Media Precision APAC, Matt Harty, senior vice president, Asia Pacific, The Trade Desk, Regan Baillie, chief business development and marketing officer, APAC, MediaCom, Gareth Mulryan, chief executive officer – Singapore, Publicis Media, Yean Cheong, head of cadreon APAC, IPG Mediabrands, Isa Cheung, event marketing manager APAC, The Trade Desk
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It’s no secret that Southeast Asia is a fast-changing landscape for advertisers. But consider this: 40 percent of the population of 659 million falls into the MACS category (middle-class and affluent consumers.) Over the next decade, that figure will grow to 64 percent. That’s 200 million more consumers with disposable income. Put another way, that’s a country the size of Brazil.

It’s no wonder, then, that digital ad spend has skyrocketed from 6 percent of total spend to 24 percent since 2013.

While the market may be growing, it’s also becoming more complex. Consumers are young. They’re fragmented across devices. Targeting them is a challenge.

Against this backdrop, 12 media leaders came together for a roundtable in Singapore on new opportunities in emerging markets to discuss the challenges they face today and in the future.

New markets pose old challenges

Henry Shelley, general manager, Southeast Asia at The Trade Desk kicked things off by sharing some telling statistics about the region. In Thailand, Internet connection speeds grew 49 percent from 2016 to 2017, a growth rate that could equate to 49 percent more content being consumed. And 46 percent of internet connected consumers in Vietnam now own a smart TV while Indonesia boasts 40 million active gamers.

Henry Shelley, general manager, Southeast Asia at The Trade Desk presents to the group

Since they’re young and it’s all they have known, Shelley adds, consumers in these countries “are more accustomed to quid pro quo of exchanging one’s personal data in return for goods and services — a luxury the EU and US markets don’t have.”

But these growing and untapped markets present logistical hurdles in terms of both language and geography, as well as clients’ willingness to adapt to change. Those issues can increase operational costs, although time and again Southeast Asia surprises advertisers.

“Everybody was telling us Vietnam was not ready for the tech, not ready for the data, but we were able to launch a tech platform and go from zero to 28 million profiles in less than two months,” says Kasper Aakerlund, president APAC at UM.

While tech might be booming, Yean Cheong, head of cadreon APAC at IPG Mediabrands notes the barriers to change that advertisers face. “Our clients hear about technology in the West and wonder why we can’t we do it here. It's about who is actually willing to come play in the sandbox,” she says. “That’s where it becomes very complicated.” 

 
Yean Cheong, head of cadreon APAC,IPG Mediabrands

She adds that brands look to markets like China, where e-commerce has given advertisers new opportunities for targeting consumers and ask agencies to help them replicate that success on platforms such as Lazada. “It can be quite overwhelming for our clients. They want us to help them navigate it, but at the same time budgets are limited, and it’s easier to say, well, ‘TV has always worked for us’. There’s a reluctance to change behaviour from an advertiser perspective.”

Sunil Naryani, GM of programmatic at Dentsu Aegis Network sees change; however, he admits it’s happening slowly. “Whenever we do market visits and meet the AdTech partners, they know what’s new. A DMP, a supply side — they have every piece of information and can build an entire ecosystem,” he says. “But their clients are still a bit slow. All the pieces are there, the pitch presentations are similar, but there’s a gap.” 

Making data easy, integrated, and attractive

That gap might stem, in part, from the ease of data solutions that some of the major channels, such as Google and Facebook, can offer brands. “There’s not enough diversity in the marketplace. We’re still throwing all of our money at only a few players,” says Jonathan Mackenzie, managing director, Publicis Media Precision APAC.

“It’s a safe thing. They have the lowest cost and the data is in-built,” adds Deepika Nikhilender, SVP APAC, Xaxis. “But there’s very little targeting toward effectiveness. There’s almost a denial in these areas.”

While clients might have access to more knowledge, they remain fixated on the solutions that have a history of success for them, including traditional TV. The problem for agencies in this kind of ecosystem is not only building a different ecosystem in which bundled, integrated solutions are an option, but convincing clients to play ball, too.

“It’s so fragmented, even from a measurement perspective,” says Cheong. “You cannot quantify it, even if you have a really strong strategy to see the whole consumer journey and the different touchpoints. This kind of ecosystem is great for conversation, but the actual practice of creating it will require either time or talent on both ends.”

Nikhilender believes the issue might be more deeply rooted than we think. “Often times, we buy expensive third-party data, but it doesn’t show any lift and the conversations go downhill. In Southeast Asia, if they fail once, they never try it again. Look at Singtel here or Axiata. Even the e-commerce players don’t respect that data.”

Deepika Nikhilender, senior vice president APAC, Xaxis
 

But as the whole world adjusts to new data, local tech providers will have a unique opportunity to catch up, and fast. “A lot of the data stack you see today has been built on a cookie-based methodology, which is outdated and not useful for the future,” Aakerlund says. “Some international players will struggle to really bring value to the ecosystem in the future.” 

Different consumers

For many at the discussion, the parallels with marketplaces such as China were obvious. “In China especially, the demand for luxury is huge now. They don’t want to have one luxury handbag; they want to have 10,” says Michael Beecroft, chief investment officer APAC, Mindshare. “The fast-tracking of wealth, buying up luxury goods to show you've come out of poverty quickly — it’s aspirational.”

“People rising out of poverty to the middle class are a very different type of consumer,” adds Matt Harty, senior vice president, Asia Pacific at The Trade Desk. “There's a certain type of magic that happens when you go from not having anything to wanting to buy a motorbike, a washing machine, a huge TV.”

The opportunity is clear; the method less so. But Mackenzie thinks now is the time for agencies to invest in “data scientists, data engineers, analytics capabilities,” he says, adding, “but clients have to invest in those skills, too, or else it's the blind leading the blind.”

Even with investment in technology, key questions remain unanswered. “How do you balance global-type clients while growing the local? How do you then make the cultural change in our markets?” Gareth Mulryan, chief executive officer – Singapore at Publicis Media wonders. However, he, like many other advertisers, recognises that solutions are not far off, and that “the shift is quick when it happens.”

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