AGECOM is stepping info the playground of traditional business consultants
Interview with Andris Blaka, the leader of AgeCom, the biggest communication agencies group in the Baltics.
When I interviewed you one year ago, you weren`t very optimistic about the developments in advertising. What`s the situation now?
The situation is the same. We’ve had a good year, we have new clients and services, but there`s still stagnation.
Age Com operates in three Baltic countries and in Belarus. Profitwise, we only have growth in Latvia. Lithuania is the biggest market for our group and the profits are the biggest, but they have slowed down which is a sign that advertising as a business sector is going through great changes. There are many challenges and the winners are companies who search for, learn, test, adapt and adopt new business models.
Where is your focus right now?
This year is an investment year for us; we are developing new technological platforms. In Estonia we have some serious development projects ongoing, which we expand across Baltics. We are investing in training as well. For example, last month our CEOs from each of our companies in Baltics and Belarus spent 2 days with professional business consultants from Western Europe analysing the business and making improvement plans for the future.
We have training programmes for everybody in our companies. We are bringing in talents from local markets as well as internationally. We are interested in marketing automatization and technology, because we believe that technology can improve our and our clients` business. We are hiring more tech people and we create fruitful combinations of different professionals.
I think that in the near future our group agency is able to win a Lion in Cannes. We take this contest very seriously, because this gives us a benchmark to understand the level of our work and if we move toward the same direction as agencies in international markets.
Where is the focus of the advertisers?
I see a lot of short-term focus. They want everything now and cheaper.
It leaves an impression that the marketing and sales departments of companies are like rapid response units. I would like to think this is not so and companies continuously understand the importance of strategic planning, but for some reason cannot always involve their partners (read: agencies).
Naturally it is the aim of all advertisers to get a healthy return of marketing investments.
What are the main media trends in the Baltics?
Programmatic advertising didn`t pick up as much as it was promised and hoped for. In the Baltics the market is too small, not enough data about the consumers and nobody wants to invest in research. Of course, internet is very important; a lot of money is going to Facebook and Google. Local vendors come up with consolidated offers which mean each vendor group has package deals covering several media types. This has its pros and cons. It is important to keep in mind that a group deal with attractive discounts might not be the best package for bringing on great business results for clients. Other than that print still seems to be losing money and importance. There are new content marketing possibilities, including cooperation with influencers.
You are the biggest communication group in the Baltics; do you have any special relations with Google or Facebook? Can you get better deals or custom-made solutions for the clients?
Yes and no. It`s still a very small market for them. I think more important question is that what is going to happen with Google or Facebook in the future. Right now, the EU and the US Government are promising to do some changes, but will they be able to do them?
Should clients pay agencies for the work they do during pitches?
If we talk about the pitches then it depends. Some clients pay for the work agencies do during the pitches. Some clients do not consider it relevant although any pitch takes a lot of resources from any agency.
Is there any corruption in this business? Is the “kickback” present in this market?
Our business here is the same as around the world, we work with big internationals clients and we service them the same way as across the globe. We apply the same standards when working with local clients, we believe transparency is important.
In our group of agencies “kickbacks” do not exist, all is regulated in agreements.
Do you see any ambitious local brands, which are very hungry and ready to shake the boat?
I cannot highlight any specific sector that would stand out. However, sometimes it seems we should pay closer attention and learn from companies like Taxify, Pipedrive, Transferwise. They have grown very fast and there’s no traditional advertising and marketing behind their growth.
Traditional big advertisers, such as banks and telcos invest in advertising less and less each year and aim to gain business success with other methods.
In those sectors of course different digital solutions, including mobile play utmost importance. Their business models change very fast and making long term plans is difficult.
So you want to reposition AgeCom from being a communication adviser to a business adviser?
Yes, we are stepping into the playground of traditional business consultants. And they enter our area of business, into the world of communication agencies. We`ll see how it goes, how and whom the clients will trust.
We have mapped clients’ expectations. We sense strong interest towards influencer marketing and growth hacking. Yet another trend is agile marketing, which embraces the skills of being adaptive, act fast to new possibilities and test different solutions. This is the future business model and we are good in that. Agile marketing is in our blood and has been throughout our existence.
I personally believe in mobile. I think it will have an increasing impact on our lives, payments, loyalty programmes, health care, etc. In all those sectors there is room for marketing and advertising.
Supporters
