MullenLowe: Challenging mindsets with effective advertising

MullenLowe Sri Lanka is the local office of the MullenLowe Group, a member of the $7.6 billion Interpublic Group (IPG) – one of the world’s leading organisations of advertising agencies and marketing services companies headquartered in New York.

Seeing great potential in the Sri Lankan market, in 2015, IPG further strengthened its commitment by acquiring a 100% stake in the agency which had started its operations in the country as LDB Lintas in 1993 and 

was subsequently known as Lowe LDB.

Since then, IPG and the MullenLowe Group have been making significant investments in the Sri Lanka business including the ramping up of operations.

MullenLowe Group Regional President, South and South East Asia Joseph George was in Colombo last week to make the formal announcements in this regard at the ceremonial unveiling of the agency’s new office in Kynsey Road, Colombo 8. Daily FT had an exclusive interview with him on IPG and MullenLowe’s commitment to the market and plans for the future.

Following are excerpts:

By Hiyal Biyagamage 

Q: You joined the advertising industry more than two decades ago and it was the start of an era where advertising agencies used novel visual communications, catchy copy lines and unorthodox marketing strategies to strengthen brand names. Since then, the industry has come a long way and has sustained many drastic changes. How do you see this transformation of the industry?

A: Let me answer that question with the actual response I gave in my very first job interview. I started my career in 1990, which makes it 27 years in this industry. The person who interviewed me asked why advertising and not marketing. I was fresh after completing my MBA and really loved marketing and its various concepts, and I said, ‘All these concepts are theoretical and the only thing that would bring those concepts to life is advertising’. Marketing concepts you have heard of and have seen are just text.  You need advertising to breathe life into those theoretical elements. I thought if I could get this opportunity to make theory come alive, why would I refuse it?

Also, I believe advertising is the only industry which allows you to work across categories and brands. An advertising agency allows you the flexibility of handling four categories and eight brands from day one, that exposure is awesome. That was principally why I got into advertising.

In terms of what has changed, I am going to stick out my neck and say not much. How things work between the agency and the client and what they seek from each other have not fundamentally changed. Yes, there are new metrics that have surfaced in terms of measuring and evaluating whether a piece of communication has worked or not. Didn’t that happen 27 years back? It did; and companies wanted consumers to engage with their brands and their communication and wanted consumers to talk about their communication. The difference is that we did not use words like ‘share’ and ‘engagement’ at that time. These concepts did exist but under different terminologies.

I guess clients are becoming more demanding. If you look at the global economy and how it is pressurising people from top to bottom, organisations are under huge pressure internally to deliver disproportionate ROIs (Return on Investments) for all the budgets they have put behind their brands. That pressure is now being passed on to advertising agencies and rightfully so. I don’t think these are unfair things that clients are doing in terms of passing pressure. So they expect agencies to deliver those ROIs.

Agencies have also started having a shorter lifespan, same as chief marketing officers (CMO). A recent global study pointed out that a CMO only has a lifespan of 18 months. If that is the case, why would you expect an agency’s tenure on a client or a brand to be significantly more than that?  What clients are seeking from agencies has not changed much but on the other hand, justifiably so, clients are getting a little more anxious and impatient.

The other significant difference is that clients are realising and articulating that all brands need to play a real role in societies and countries. This thinking is increasingly becoming a critical reason for a brand’s existence beyond functional deliveries. What is the difference I am bringing to people through my brand? What is the purpose of my brand? That is quite a change I am seeing now and it is welcoming. Like I keep saying: you just don’t buy brands, you buy into brands. And so, brands need to stand up for something that is beyond their marketable attributes.

Q: The boom of the internet in the late ’90s has disrupted the approach of many advertising agencies. Many of them had to realign their strategies and think of out-of-the-box solutions for brands which were willing to move away from traditional advertising to digital platforms. You won’t see much of a difference today as many brands would love to leverage on new digital strategies. Is traditional advertising dying?

A: One needs to understand that there is a fundamental difference between digital marketing and marketing for a digitised world. I think often clients and agencies get carried away by saying ‘let us do some digital marketing’. The world has got digitised and therefore you need to market, given that new reality. Advertising agencies need to understand the difference between channel messaging and brand messaging. They need to figure out first and foremost what they have to say about the brand.

In the good old days, there were only three forms of communication: billboards, radio and print. Then suddenly, films came into everybody’s lives. Ad agencies ran helter-skelter to figure out how to leverage this novel medium. What did ad agencies do? They quickly formed a Film Department. Here is the interesting part: all agencies that were quick to bring the film department to the centre of the agency are the ones who survived. All agencies which continued to treat the film department as a specialist function perished. That is what is happening with digital. The more and more you treat digital as a specialised function, the faster you will cause the death of the creative agency.

The way you think of a consumer and brand engagement, those fundamentals of marketing and communication do not change. That is why it is critical for traditional functions in an ad agency to also think of how to market and communicate in a digitised world and that is why the basic skill set and competency of writing, storytelling, narratives, and marketing skills are as relevant as they were before. I guess these skills are more important now because the average number of brands which exist within a category are hundredfold. Take Sri Lanka for an example. In the local market, there are more than 100 soap brands. The more brands in a category means that there are more reasons to differentiate. How do you do that? Only through proposition, preference building and brand imagery.  Ad agencies are the experts in doing that. So we are here to stay.

Q: Over the years, a number of international advertising agencies have come in and formed their own offices in Sri Lanka. How does MullenLowe see the legacy of Lowe LDB in this country?

A: There is no denying that Lowe LDB is a legacy brand in Sri Lanka; pretty much like Lintas in India. Very few brands are known equally in boardrooms and drawing rooms. People who have nothing to do with marketing recognise these brands. That is something we are acutely and happily aware of. This combined with the fact that we had legends who defined advertising in Sri Lanka is a great plus point. Thankfully, we have had a history of building some strong brands. As an agency, we need to be clear on what we are building for the future and what we are borrowing from the past.

There are certain things which have worked for us. I think there is a culture of creativity that has always been at the core of what we have done. That is something we are absolutely certain we will never shed because we are acutely aware that the only transactable ware we have is the creative product. There is no other reason for us to exist. So the primacy of creativity, creative culture and the creative product will always drive what we are here for.

I mentioned that clients have become more demanding. Again, that is something we have taken very seriously as an agency for a long time. We are not in the art business. We do not do advertising for just entertainment. We do it to sell products, to change mindsets, to change behaviours and to make people feel about a certain point or an issue. If you look at the last decade, we have been winning effectiveness awards every year. That to me is quite telling of an agency’s culture. Managers will come and go, chief executives will come and go, regional people will come and go but what is beautiful is that there is a culture of creativity and creativity that holds centre stage in this agency.

Q: In 2015, Interpublic Group (IPG) acquired a 100% stake in Lowe LDB. How did this acquisition conversation start?

A: The MullenLowe merger and rebranding happened globally in the middle of 2015. Both Mullen and Lowe are IPG agencies. Mullen is quite strong in the USA and Lowe is a strong brand name in Asia and Europe. IPG realised that to build a truly strong global brand, you need agencies which are equally strong in all continents. USA is the advertising hub and that is where big bucks are spent and big brands are built. With this union of Mullen and Lowe, we are truly a global brand now.

The acquisition conversation happened before the MullenLowe merger. Again, IPG and the Lowe Worldwide leadership believed in the potential of the Sri Lankan market. If you look at the last four to six years, GDP growth has been steady. In the next few years, I would love to see it growing about 8% or 9% and it is a matter of time. The opening ceremony of our new office was graced by Minister Eran Wickramaratne. We were all so impressed with him. If we have people of that quality, competency and calibre who could actually shape the Government’s policies, Sri Lanka will be a great place to do business in.

Secondly, IPG had faith and belief in this agency and its people. If you have faith in the market and have faith in the agency, then the rest are not very tough calls to make.

Q: You talked about creativity and effectiveness which are vital elements in advertising. Do these go hand in hand?

A: Let me take an Indian-specific example. We don’t enter creative awards. As a group, we only enter effectiveness awards. My stand on this has been very clear. Any award show that doesn’t take into account why a piece of communication was created nor the ultimate impact in the market is absurd and an irresponsible and indulgent distraction. Now, if we do a quick check on all the brands that have won effectiveness awards over the last decade, I can guarantee that at last 75% of them would have won also in a pure creative awards show. This leads us to a simple and irrefutable conclusion: if it is not creative, chances are very remote that it will be effective.

Effectiveness is the outcome and creativeness is the input. So it is not about going hand in hand. One factor leads to the other. I cannot be effective without being creative in my solution. Creativity is not about script writing, ideating and all that. Those are all skill sets. Creativity is about value addition. I think we have been unfair to creativity by assuming that the definition of creativity is just entertainment and fun. It is beyond that. It is a very hard thing to achieve.

Q: How is the vision aligned for Sri Lanka with this strategic acquisition?

A: In terms of vision and philosophy, there is no difference. Different markets have different objectives. From my perspective, there are two or three areas we want to focus on. One is that we need to quickly scale up. My genuine belief is that the equity we enjoy in this market is probably a lot larger than the size of our operations. That is a fantastic position to be in at the moment. Many companies and brands struggle to build equity. We have great equity and we need to convert a bit more of that into actual scale.

Secondly, our track record with Unilever brands is phenomenal. There is a lot we have learnt by both working with the brands and with Unilever managers. That is something we want to leverage further with other marketeers in the country as well. From an agency point of view, it will be silly on our part not to leverage this.

Thirdly, we want to focus on building three additional capabilities: digital, design and public relations (PR). It is not that we want to start a digital division. It is about how ‘do I get people to start thinking about it?’ right from the first conversation with the client. About PR, over the past few years, especially in this region, more and more clients are realising that PR is actually a cost-effective way of building brand awareness and brand engagement. Many clients are realising that they don’t need to spend big bucks on advertising when they can actually do smart PR.

We also want to discuss and evaluate the design aspect as well. More and more clients are beginning to realise that investing in design is the fastest way for a brand to be able to charge a premium. Typically, you would build a brand over the years, build a huge fan-following, get people hooked on to the brand and ensure that there is not much price elasticity. Once you come to that sweet spot, you start thinking about increasing the price. That takes a long time though. In today’s time and its compulsions, companies cannot wait for such a long time to improve their realisation. Design allows you to short-circuit the entire process. That is the other thing we want to look at because that can be of huge value to clients who are at this point of time hesitant or unable to charge a premium.

Q: It is no secret that there is competition in the market with many advertising agencies. How does MullenLowe differentiate itself as a unique brand?

A: I am not aware of the relative strengths and weaknesses of different agencies in Sri Lanka and that is not the way we have ever approached a market. There are certain things that we believe that we should be doing and we put our heads down and do it.

There are two areas I see where we could be differentiators in this industry. We should continue to focus on the fact that we are the most effective agency in Sri Lanka. Clients should feel that MullenLowe would be the ideal agency if they want a communication piece that would actually work. That is from a delivery outcome point of view. The other area we would like to look on is our attitude. ‘Challenger mindset’ is key in the way we approach work. When we say that, it is not that we want to handle brands which are number two or three or four in their categories. We want to challenge mindsets, behaviour, beliefs and category norms.

Q: How would you look at the future, since you are very confident of the local market?

A: I think the new office looks awesome. The physicality of the agency reflects how we currently feel about ourselves as well as what we want to do and achieve in this market. Most importantly, our current clients are happy with our people and with the work we are doing for them. Many of them engaged with me during the new office launch and talked about what they want from us going forward, because they want us to partner in their ambitious journey. These are great things to hear. Yes, I really feel the vibe in this market and I believe the future looks very bright for MullenLowe in Sri Lanka.

Pix by Lasantha Kumara