Media360 Indonesia, the first in a series of local-market conferences taking place this year, delved into a wide range of issues—brand safety, the role of agencies, driving and/or surviving disruption, the rebundling of agency functions, insourcing versus outsourcing, and the role of influencers, to name a few—yesterday in Jakarta. Here, a selection of standout comments from the all-day conference from the likes of Unilver, L'Oreal, Bukalapak, HP, Facebook, GroupM, AdColony and Mondelez.
"The age of giants is in question."
—Umesh Phadke, president and director, L'Oreal Indonesia
Phadke explained that once up a time, and not so long ago, people predicted that the FMCG giants would continue consolidating their business around the world, to the point that there would eventually only be a few brands in each major category. Back then, being locally made was not an advantage.
"With the rise of Asia and changing consumer preferences, that axiom is no longer true," he said. Today 'Made in Indonesia" is aspirational. "Local companies have figured it out."
"If we don't innovatate we will die. And the same for you guys."
—Achmad Zaky, founder and CEO, Bukalapak
Zaky, founder of an ecommerce marketplace, started the above quote speaking about his company's own ethos, that continual innovation is necessary for survival. He then spun it around on the assembled marketers and media leaders. Technology is about a culture of disrupting anything inefficient, and if we want to survive, we have to adopt tech as a way of life, he added.
"Wherever you come from, the forces of change today are making our industry change like it has never changed before. And in a way we are very fortunate, because the change happening today is the slowest it is ever going to be in the future."
—Hemant Bakshi, CEO Indonesia, Unilever
It's interesting to note that the CEO of the market's biggest advertiser and old-line FMCG giant sounded a warning very similar to that issued by the internet hotshot, Zaky. "Think of yourself as an insurgent," Bakshi added. while urging his peers to realize that anyone is a target for disruption. None of the traditional FMCG competitive advantages, such as networks of distributors or agreements with large retailers, means much anymore. Because...
"Anyone with a mobile phone and an idea can be a disruptor."
—Sri Widowati, country director, Facebook Indonesia
Widowati moderated a discussion featuring three young women driving Indonesian-grown beauty brands that, while perhaps not yet threatening the major players, are at least on their radar: Rina Busri, CEO of Ertos Beauty; Lizzie Para, CEO of BLP Beauty, and Putri Diah Paramita, marketing director of Paragon Technology and Innovations (owner of Wardah). Each has built impressive businesses starting with not much more than a genuine understanding of the market.
"This is not normal times for indonesia."
—Jahanzeb Naseer, MD, PT Credit Suisse Securities
"This is the slowest-growth period over the last 30 years," Naseer said. "Indonesia historically is a manic-depressive economy. It's either in crisis, or it's booming." The last few years have seen slower growth, however, and people on lower portions of the economic ladder have actually seen real income decline. But Indonesian consumers are remarkably optimistic, and with the government increasing subsidies for lower-income subsidies families this year, signs of increased speding are strong.
"It's quite clear that the agency model at the moment is not fit for purpose."
—Ed Thesiger, CEO of Vietnam and Indonesia, GroupM
Thesiger expressed his "very strong view" that as long as agency financials remain siloed, then "the whole joined up, integration thing" is going to be difficult. Meanwhile unbundled agency services leads to multiple, tactical campaigns rather than a cohesive brand platform. The comments came in the midst of a panel discussion that presented a wide range of views about how much rebundlng should take place, or whether it is indeed possible to put the proverbial toothpaste back in the tube.
"It takes time to change your mindset and make the measurements, but once you get it right, it pays for itself."
—Hemant Chauhan, media and data strategy lead, APAC, HP
"There's a huge awareness that needs to be created that good media comes at a price."
—Asha Gourinath, head of digital paid media, Indonesia, Havas Media Group
"You're pushing down the accelerator, but the wheels will be spinning because there's no road beneath them."
—Tom Simpson, VP programmatic, APAC, Adcolony
These comments came from an excellent discussion about digital transparency, brand safety and ad fraud, moderated by Niall Hogan, MD for Southeast Asia with Integral Ad Science. The key to making the best of digital spend, all agreed, is for advertisers to focus on the quality of media that they're buying.
Chauhan was speaking of a lengthy process HP has gone through, moving methodically from high-reach, low-cost spending toward higher-quality media—with the higher CPMs that come along with it. The payoff: Higher conversion rates and lower cost-per-conversion overall. Gourinath commented that many advertisers still hesitate to pay the higher cost that quality publishers command. But Simpson's comment pertained to the situation brands face if they don't get their digital engine running smoothly.
For more on media quality, see this news story about new research from Integral Ad Science: APAC markets exceed global benchmarks for viewability, brand safety.
"Not too long ago in history, we had a clear understandng that Facebook likes were the way to go."
—Sachin Prasad, president director, Indonesia, Mondelez
Far from picking on Facebook, Prasad was making a point about how advertisers need to take care about shifting their budgets too quickly and too far into any new media. Answering that question involves starting with the consumer, he said. "How fast can we marry the consumer problem and the technology trend together?"