Goafest 2016: '90 pc of the payment problem is that agencies undercut each other'

Oliver Maletz, head of connections planning, media and international communication, Volkswagen AG, delivered the last talk at the Industry Conclave on day one at Goafest 2016. While the theme was advice meant for agency partners, Maletz said his points work for both sides.

 

He started the session with a quote on what clients want: "I want to be your favourite hello and your hardest goodbye."

 

Business Partners

 

Maletz urged agencies to think a little harder before reaching out to the client. He elaborated, "A true business partner needs to know our business better than we do. It's about identifying opportunities. Our business is your business. That must be kept in mind. It's about an attitude. You have the capacity and youth to come up with disruptiveness. From our perspective we have a creative, digital, media, PR and even an event agency. Their needs to be collaboration between them."

 

Stop Selling 

 

The speaker urged agencies to stop 'overselling' to them. He said, "Whether it's capabilities, people, other companies within the holding company, there needs to be a stop to it. The more you oversell these services, the loss of trust comes in."

 

Meaningful Value

 

The German auto manufacturer's executive sought meaningful value from agencies. "Don't be innovative for the sake of being innovative. There are cool ideas out there that might get some buzz too, but if it doesn't match the KPI, it doesn't make sense. Deliver meaningful value to a meaningful number of people." he surmised.

 

His session was followed by a round table discussion chaired by CVL Srinivas, CEO, GroupM South Asia, and featured Maletz along with Samar Singh Sheikhawat, SVP marketing, United Breweries and Mondelez India MD Chandramouli Venkatesan.

 

Srinivas posed a question to Sheikhawat about whether agencies were taking the easy way out and gathering ideas from what's available and done online. The UB marketer replied in the affirmative and said, "Yes, and it's not only the agencies, even the clients are doing that."

 

The next point was on the structure of the marketing agencies five years down the line. Sheikhawat said, "Structures are definitely changing. A marketing job is so much more difficult now. We already have regional teams. With e-commerce coming in footfalls haven't changed, but conversions have. People are trying out products in these outlets and purchasing them online." 

 

Responding to a question about fragmentation and how all agency partners should be equally involved, Maletz said, "Trying to have one lead agency means that others aren't top of mind. Then they wouldn't give the client that much importance and not send their senior resources. We just had a good session where all the agencies - creative, media and PR sat together for aligning our targets."

 

Srinivas then brought up a question about agency remuneration and whether they're paid less. Venkatesan concurred and said that the main problem for this is agencies undercutting each other. "Ninety per cent of the payment problem is that agencies undercut each other. If one person is giving an iPhone for 50,000 and the other for 30,000, it's pretty obvious I'll take the cheaper option. We are all consumers after all."