In July, Experiential Marketing Association of Nigeria (EXMAN) will be marking its second year of establishment. In this chat with Ntia Usukuma, Lukmon Oloyede and Martin Ogumah, The President of the Association and the Managing Director of Towncriers, Kayode Olagesin explains why they came together, and the benefits members have derived since the Association was formed.
What is EXMAN all about?
The idea came when we realized there was a need for us to come together as Experiential Marketing practitioners. We were facing a lot of challenges and saw the need for us to address them collectively. Top on the line was the perennial issue of quackery. Some people just find their way into experiential marketing without having the ample knowledge. They parade themselves as professionals simply because they know one or two people on the client side willing to give them business.
Agencies who invested in huge resources to get the job done were competing with those with little or no resources nor the competence to deliver professionally. If you look at even businesses with multinationals, you will realize that some of us
were suffering in silence. The terms of engagement were not altogether fair but who are we to complain – he who pays the piper dictates the tune. So if you rely on these companies for business and you have 20 or more people who are ready to work with them, you just have to adjust and manage with what you have.
It became a matter of survival because if we continued this way, sooner or later, we will begin to see many agencies collapse. So we said – if we come together, what are the things we will want to address? We knew we needed to ensure our members behave more professionally. So we organized training programmes to improve knowledge among our members’ staff. Still in the area of professionalism, we realized there is a need for us to develop a Code of Conduct and so we had a committee looking into that area.
The committee looked at other codes in the industry, within and outside the country to create our own unique code. We then shared it with other stakeholders such as APCON, AAAN, ADVAN for inputs etc. We launched it at our Annual General Meeting last year. It was fundamentally about self-regulation. Our codes state clearly how we relate on the job with alcoholic beverages, children and so on. So when we work, you will find out there is a difference in the way members of EXMAN will operate compared to others.
There is a misconception that Experiential Marketing is all about entertainment and advertising. What stands you out?
There is a different approach between advertising and experiential marketing. Advertising looks at the mass audience and
to disseminate information to them at a go. Experiential marketing on the other hand, is a lot more consumer-focused. Our approach is more direct because we engage with the audience. It is often said that experience is the best teacher. What stays with us most is our experience. What we try to do in experiential marketing is to connect people and brands together by creating positive experience which will attract them to that brand for a long time.
The principle of the experiential marketing is that the more we can create an emotional experience between a consumer and a brand, the more that consumer can connect with that brand and reward the brand with repeated purchase.
Can the impact of experiential marketing be measured?
Why most of the client put more of their money on experiential marketing over the years is because of the measurability. Empirical evidence has shown that after activation at a location, you can measure performance against the pre-activation level of sales to measure Return on Investment.
That helps companies to say, oh this works, let’s go and do it again or say no, let’s restrategize and do something else.
People equate experiential marketing with entertainment because of the passion points of the consumers. All of us regardless of who we are, have our areas of interest. For some of us, it is football, music or dance, for others it may be technology, fashion or games. If you look at the majority of Nigerians that are predominantly young, you will find that a lot of them are interested in that particular segment – entertainment.
So if you want to engage them, you must be able to bring them into that area of interest. Because entertainment is essentialto most of them, we use it as a means to an end. So, we use it to get their attention before we convey the message that we want them to act upon.
READ ALSO Consolidating Relevance on The Marketing Turf
Advertising messages intrude into the audiences’ consciousness but with experimental marketing, the audience is held captive, by choice. If there is a road show, the moment I decide to stop and watch what they are doing, at that particular moment I’m a captive audience.
Who is qualified to practice experiential marketing? How are you pushing for the full involvement of all Experiential Marketers?
Anybody who wants to practice experiential marketing should be experienced in all the basic areas of integrated marketing
communications. Most practitioners have realized that there is a need for us as an association to integrate more with the larger IMC industry, because we believe it will help improve practice. We met with the former APCON Chair and plan to meet the new one now that the new APCON Council has been inaugurated. What we have now as EXMAN officials is ‘moral-situation’.
We do not have the force of law to say that anybody must join us. However, the APCON reform that came into fore last year, does offer some protection for those that are properly licensed to practice in this segment of the industry. What that means is that for those of us in experiential marketing where it is an all comers affair presently, we will be able to lock people out by the time we actualize the benefit enshrined in the APCON reform. Because the law says that if you don’t belong to an advertising sectorial group, you are only practicing illegally. By that time we will be able to write to a particular client and say – if you have an agency that is not a member of EXMAN, please note that you are promoting illegality.
By then, we will engage those outsiders with the force of the law to ensure things are done properly.
What is required to be a member of EXMAN?
To be a member of EXMAN, you need to properly register as a business in Nigeria. You must have a physical and verifiable address; you must have staff with particular functions even if you do not have departments. What we mean by function is that we must be able to identify that – this is the person that is performing administrative function, client service, finance and others.
They must be qualified people carrying out those functions. We will come and inspect your agency, try and understand what you are doing and if the person does not meet up, we will tell the people why they did not meet up and say they can reapply in another three months after working on the issues pointed out.
[ad id=”667″]We have taken the reports of quite a number of agencies. And by the time we have our AGM we should have about 40 member agencies in our Association. We were 30 at inception.
As the president of EXMAN, what has been your achievement?
As the president, what will be the icing on the cake will be for me to ensure that we are fully integrated with APCON. I look at the training programmes and the Code of Conduct as major landmarks in laying a foundation that is solid enough to build on.
We are also pushing to restructure our business relationship with some multinational companies. Why we are not happy with some multinational companies is that they tell agencies to execute a project, 100% on credit and at the end of the day, they pay – depending on the clients – 30 days, 40 days, 60 days after the job has been completed.
What happens here is that agencies suffer massive cash flow challenges. Cash flow is the life line of any business. With this type of relationship, our members are very anemic when it comes to our cash flow. Most of the time, we have a lot of money on paper but it’s not on our hands. The challenge there is that there is no sustainability. You cannot invest in training and other things that will make us solid because we are basically living from hand-to-mouth. The implication is that multinationals and other clients are actually stifling growth in this particular segment of the industry. Majority of the clients do not offer favourable business terms.
Traditionally, agencies in advertising are expected to make at least 20% as income but we now have an aberration where clients want experiential agencies to provide net third party costs with a 10 percent fee as income.
What is the aberration in this?
The aberration is that they want to enjoy the benefit of two diverse systems. They are applying what applies in a fixed fee regime to a commission system. They say to agencies that if we pay you 10 per cent agency fee, you must show me all third party costs. They expect the agency to survive on only 10 per cent agency fee. So, the client wants you to spend your own money to deliver, and then invoice them on exact third party costs with no mark up. You will use your money to do the business and you are still limited to how much money you can earn. Such situation is not fair and transparent. Net third
party costs apply only in a fixed fee regime where some reasonable cushion has been calculated for the agency. So I say to clients that I’m up for transparency and I want us to be transparent in all dealings but he who comes to equity must come with clean hands. Agencies must be able to earn legitimate income transparently. We have been trying to discuss this with client and published an advertorial in the papers with this message.
READ ALSO GTBank wins Euromoney Best Bank in Nigeria
Naturally, they are benefiting from the situation and so we have been trying to talk to the clients but majority of them are not forth-coming. We have said to our members that we cannot fight the battle individually. If we come together on this, it may hurt you now but in the long run, you will probably remain in business. But a situation where the clients are knocking our heads against each other and we are not talking to ourselves on something that at the same time will lead to the death of all of us in business that was why we must table this issue. A lot of clients believe that most agencies are doing quite well but the truth is those who run the agencies might be looking good but their businesses are not. Most of the businesses
in this sector today are not rosy as many think, that is why we need to bring this to the fore.
What are the major challenges your members face generally in the course of business?
Multiple taxes are a big challenge. We are happy that the Joint Tax Board has promised to do something about this. We do projects across the country. When you cross to other states, you will be expected to pay the same tax you paid in another state. Some government agencies see us as cash cows they can milk the way they desire. We ought to have an emblem that once you pay in a state; you should be able to operate all over Nigeria. There should be no need for duplication. This is why the new initiative by the JTB is in order. Many of our people have suffered in the hands of Local Government thugs and State Government revenue collection agents, on this account of multiple taxes. It is illegal.
We are in the process of getting a reputable law firm that will defend the rights of our members. So that those who molest
our staff, impound our vehicles will face the full wrath of the law.
Are affiliations beneficial to local agencies?
In my opinion, some agencies have benefitted so well from international affiliation. Some might not have had it so well. It depends on the affiliation agreement that you have with those foreign agencies. Some agencies have been exposed to international training and exposure. Others have some big account dropped on their laps without having to go for any pitch. I think generally, affiliation is good and we need to understand that we are competing in a global environment for consumers that are global citizens. I feel we need to know the global standards and expose ourselves before we can compete with the rest of the world.
How can you describe your leadership style?
I believe in empowering people. I don’t like spoon-feeding people. I love people who take a position on things and get things done. I prefer to work with solution oriented people. We “kill” people by doing things for them. In this culture, we do everything for our children. We don’t allow our staff to do things on their own and use their initiative.
Sometimes, it is good for them to make the mistakes as long as you don’t allow things to go beyond repairs and then that will be part of their learning. We learn the most through experience.