Be it creating affiliation with the world’s number one Media Agency Network Carat or its impressive portfolio or with one of the leading media communication groups Dentsu Aegis Network , MACOMM and MediaAxis easily stands out as one of the smartest companies in Bangladesh in advertising and media buying. Much of that can be attributed to its founder and CEO Rabeth Khan.
A man of diverse interests and expertise, Rabeth’s approach to doing thing is by constantly learning. This makes sense professionally, and even more so in his field where reaching and persuading the public is the ultimate outcome and prize. That has been the focus of MACOMM, since Rabeth founded the company in 2005. It quickly gave birth to MediaAxis, which is the official affiliate of Carat/Dentsu Aegis Network in Bangladesh providing media planning, media buying and digital/online services. MediaAxis/Carat is one of the top three global media network agencies in Bangladesh.
Fintech met with Rabeth Khan at his office to talk about MediaAxis, the media buying industry, adopting digital disruptions and other related topics.
FINTECH: You are affiliated with Dentsu. What does this entail? In what ways this is different from operating on your own?
When we started, our first company was MACOMM. Companies go through different stages in their existence. At that time, in 2005, we were really focused on how to survive in the existing market which already had experienced and bigger players playing. That was the first priority, as it should be for any business really. Secondly, you have to have a vision and an understanding about your environment or your context within which you will be operating. When we started the market was already saturated. You had InterSpeed, Unitrend, Expression, Adcomm and so on. The market seemed saturated. Many people told me ‘do you think you can survive fighting these competitions?’
But what I thought was that we have 16 crore people. And the growth of brands will be proportional to this population. So, there will be space for everyone. I didn’t think saturation point was reached then and even today. Since I’ve been in this industry for a long time, I always believed that the bigger companies had gaps in how they did things. I was able to identify those gaps. And that is why when we started we got three accounts in the first six months: Panasonic, Tourism Malaysia and Toshiba. When you get three global accounts in six months, then it’s very easy to build your confidence and grow up.
That’s how it went on for four years, up to 2009. At that time media agencies started to emerge. You didn’t have media agencies before that. You had events-led agencies or creative-led agencies with media service capabilities as well. We had a two-person operation that took care of the media side. But we felt that this needed to grow and we recognized that we needed specialization. And we also recognized that we didn’t have that specialization. So, what to do then?
Dentsu and Aegis hadn’t merged at that time. Carat was under Aegis. That’s when I formed Media Axis and formed the affiliation with Carat. Within three months of affiliation we got Nokia through a global and local pitch. In 2009 Nokia was massive. It was in the leadership position. That was the start of our media agency. In 2015 Aegis Network asked us if we wanted to expand our creative operations and tie up internationally with Dentsu with whom they were merging. We thought that was the right time, because we had challenged ourselves and won the initial challenge by working without affiliation and reaching a commendable position without one. Not only we survived, but we consolidated, grew and established ourselves as one of the key agencies in Bangladesh’s ecosystem. Now, we can certainly think about growing beyond that.
We thought that was great and our affiliation was finalized in 2015. So, coming back to your key question, what we gained or still are gaining from this affiliation is that you can learn at the local level up only up to a point. After that you need a different level of exposure to learn more. If you want to embrace the international standards, then you will have to have international association. The first thing that changed with the affiliation is the work process. We achieved the next level of expertise that we needed for handling global clients. Secondly, Dentsu is so strong in the Japanese market that they handle 75 of the hundred biggest accounts. So, that’s leading with 75 percent market share. What that means for us is that any Japanese company coming to Bangladesh will find an agency ready to service them in the way, they would have experienced in their own backyard. That’s an instant gratification of the relationship. And then you have knowledge acquiring, which is of continuous importance.
FINTECH: What is the current state of media buying business in Bangladesh?
A new way of working or new culture had been developing at the time we started. After we got Nokia in 2009, we got the first experience of working in digital for the first time. So, the transformation was already seeding. What was different before was that the whole media business was individual-based. If you knew someone that mattered. It was very personality based. Agencies like ‘Mattra’ didn’t matter, Mr Afzal mattered. But that has changed. What you can do as an organization is more important now. There has been a big landscape change.
FINTECH: How is the media buying business different in Bangladesh compared to a more developed economy?
One difference is in human resources. There is a lack of good resources to this day. Secondly, the entire data-understanding is still inadequate. The practice of perceptive planning is still prevalent in Bangladeshi media agencies. That is very flawed, because basically you are thinking that people see what you see and people think what you think. This is just wrong. Till today, we only have one source dependent TV data and very insignificant data on Radio, Print, Digital and no data on OOH.
That’s not how companies in more developed economies operates. They don’t do things based on perception. Decisions are made based on research, data, tools and work process. Third, I think there is a lack of willingness to learn among the new generation as well as among the senior people. I think these are fundamental things that are different.
What you said about data is equally relevant to other businesses. One of the main problems is that credible data is not available. How do you deal with that?
We take our data from Kantar. It’s the only reliable data source. All big agencies subscribe to it. We spend Tk15 to Tk20 lakh to buy data. This is the only recognized and credible source. There is no second option. But what happens is that when you need alternative data, agencies tend to do their own research. So, we have a small wing with just two people. We call it ‘Black Box’. When we need to create a strategy we instantly go for focus group discussions or physical primary research or online research. We set the parameters and tell the team what we are looking to get. They design the research accordingly and conduct the research with 100 or 200 participants. That contributes to our strategy. You can’t really create strategy without data.
FINTECH: What kinds of software tools you use for data analysis?
Does kantar provide you the data analysis? There are two software for media data: MX4 and NMS which are used by all bigger agencies like us. We get this from our data provider company. We train our team and they use the software. In addition, we are also using three proprietary tools provided by DAN. In addition we are using 3-4 digital data linked with Facebook Analytics, Google Analytics and couple of others.
Briefly walk us through the process of getting a client on-board and the later process of how you approach getting to your target, as expected by your client.
Well, pitching is just that, pitching. You have global-led pitch and local-led pitch. You also have companies giving out an ‘agency brief’. A number of agencies work on that. What they look for is the strategic understanding of the brief. Then they look at the delivering of solutions needed for that brief. Thirdly, they look at the financial and quantitative aspects; what you are going to charge them, if there are fees, etc. Fourth, they look at the team you are going to assign on that business. Fifth, they look at how the global affiliation of the agency will add value to their business. These are the five fundamentals.
After you win over your client and get the business, you will have to execute all of these five fundamentals. You will have to deliver on everything you said in your pitch. What happens is that when you enter into agreement with a client, they set you a set of KPIs. If you can achieve these KPI then you will sustain and/or you will get rewards. And now many clients impose penalties in case you fail your KPIs. That is certainly something you want to avoid. There are many forms of penalties that are practiced. The most practiced form is deducting from the non-fixed fees. There is a fees structure that is widely followed. You have, for example, 60 percent fixed fees, which you will get irrespective of outcome and the rest 40 percent is based on performance. The penalty is from this 40 percent.
FINTECH: Digital transformation has changed everything. How your sector is changing and how well you have been able to adopt?
It affects everyone. Not just industries, but consumers. You are shopping on digital, getting entertainment on digital, paying on digital, commuting using digital – like Uber, everything is digital. It’s no surprise that it impacted everyone.
As for how we are preparing ourselves, we have been working with digital since 2009. Until last month we had a division of five or six people. But we saw that the digital requirements by our clients increasing all the time. So, we communicated to our mother brand DAN that we need expertise, people and training. They heard out my plan and supported me wholeheartedly. As a result, in April 26 we launched our independent digital agency, it’s called D’reach. We had some of the biggest agency digital heads from DAN digital verticals – Isobar, i-Prospect and SVG and DAN Regional Chairman spearheading the launch.
What we did immediately was that we organized a session with about 25 clients that are under our different operations, as well as five or six others who were about to become clients. It was a full daylong session with the 30 clients. We are accountable to our clients and it is a responsibility of us to make our clients and their brands stay ahead of their category competition in the digital domain.
We achieved two things by that session. All our clients realized that we have taken the next step in digital practices and knowledge progression, before practically all of the digital agencies in the country. Secondly, since we brought in all the digital ‘gurus’, who really knows ten times more than what we do, everyone actually felt how effective and timely it was. All the clients who participated in the event told us that the session was an eye opener. And what happened instantly afterwards was that we expanded our business in the existing accounts and have won 3 more clients in one month time. Clients also realized that they need to put more emphasis on digital and invest more on digital. For example, you have more than three crore Facebook users that whose TV and newspaper consumption is very low. How to connect with them? You connect with them on the digital platform.
Most importantly, we really feel ready now. We have been bringing senior leadership members from India for the last two years to train our local team, in addition to using their expertise. We will also have someone from DAN digital verticals coming here in multiple intervals in a year to continually train us, educate us and share with us the newest progressions of digital advertising and other new forms of advertising progressions.
FINTECH: Thank you for talking to us.
You are welcome.