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 The Middle East’s media-centric culture is starting to change, and clients are putting increasingly significant proportions of their ad spend into digital, according to Daniel Verpeaux, managing director of Euro RSCG Dubai.
Verpeaux, who described the change as a “small revolution”, joined the Dubai office of Euro RSCG at the start of 2009 – and in speaking to him, it was noticeable that, much more so than other agency bosses in the region, he treats digital as a reality rather than an emergent trend.
“Here there’s the culture of the showoff – you have to have your name or your car big, big. But does the billboard sell something or not?” asks Verpeaux.
“Communication is not only advertising, as we know. To have a billboard on Sheikh Zayed Road, it’s perfect – but we need a little bit from other disciplines. But sometimes here, because it’s a media culture, the client is very satisfied to have the big names on Sheikh Zayed Road. They’ll spend a lot of money to have one big billboard, and for not a lot of effect, in fact,” he adds.
But even in the few months he’s been in the region, Verpeaux notes that the situation has changed. He puts this down to the changing roster of people coming through the industry, bringing a more digital-focused mindset with them.
As far as Euro RSCG’s clients are concerned, digital is likely to become a significant part of the media plan for a number of them, according to Verpeaux: “We have a forecast for some clients to put maybe 40% of their budgets in digital – because they see it as key for some categories of consumers.”
This does, of course, create a different issue: “But the problem is if they put 40% in digital, the media buying risks decreasing. That’s why we don’t know what the situation will be in 2010, with our forecasts – but we’re being very conservative about media buying. The clients may ask us to put their print and radio budgets into digital, into online, but keep their TV spend. We don’t know.”
Verpeaux’s matter-of-fact discussion of digital marketing and its implications stems in part from the integrated nature of his agency, with ATL advertising, PR, digital, design and media buying all sitting under one roof, and one P&L.
He notes, as others
have done in the past, that big agencies are often not particularly keen on pushing digital, and clients often aren’t interested: “Digital hasn’t taken off here yet, because the international clients have not received instructions to use digital. It’s a decision for local managers in the market.
“If the agencies don’t advise that digital is a good tool, then the clients will probably not use it. Also the agencies using the classical disciplines will probably win more money than digital – this is why they’re pushing on the traditional media. The margin is better; $60,000 for a website is not a lot,” adds Verpeaux.
Aside from digital online, Verpeaux also sees customer relationship management (CRM) as an important future trend, especially in the luxury goods sector. As a new part of the recently-formed Euro RSCG Luxe network-in-a-network, the agency sees its other offices using CRM for luxury brands – but Verpeaux says the Middle East lacks the expertise and understanding to implement it at the moment.
“CRM is a combination of a database and creativity. It’s something that an ad agency can do – but it’s also complex, more technical. We have this talent in Europe, in the US – but not totally here. But there is a fantastic market, for luxury and automotive,” he says.
“I think 90% of the brands here that sell luxury cars don’t know their customers. They sell, maybe they know a few names – but with a CRM approach, they can do more. Some try to launch CRM programmes – but not a lot. We’ve checked with some brands, but there is a lack in this field.”
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