Opinion

WPP Indonesia boss Ranjana Singh on the challenges and opportunities in Southeast Asia’s largest ad market

Ranjana SinghAs country head of WPP in Indonesia, Ranjana Singh is one of Southeast Asia’s most powerful advertising executives.

In this interview from her offices in Jakarta, Mumbrella Asia’s editor Robin Hicks talks about why the current ill health of Indonesia’s economy is a “matter of sentiment”, where growth in the archipelago’s advertising market will come from next, and how WPP is tackling the country’s talent crunch.

Indonesia’s economy is not in a good way. What’s your take on the situation?

We have GDP growth of 4.7 per cent. The US dollar exchange rate is tough and exports are down. Normally when your currency weakens your exports go up, so you can’t link those too. Commodities are down. But the ojek [motorbike] driver, does he care about the exchange rate? We do know that with a lot of products in Indonesia, some raw material is imported, so inflation will go up. But so far inflation hasn’t been scary.

A friend who works at a big TV station in Indonesia tells me that ad spend – most of which comes from consumer goods – is down around 12-14 per cent year on year. Can the fall be compared to the bad times of 2008?

View from WPP's office in Jakarta

View from WPP’s office in Jakarta

No way. It’s just a matter of sentiment. The business sector is being cautious; the exchange rate does affect their P&L. But a lot has to do with political dynamics and the policies and strategy of the new government – this is why they’re holding back.

There is nothing fundamentally wrong with the economy. This is my challenge to the pessimists. I see no reason why GDP growth shouldn’t have been five per cent plus. Again, this is to do with the delayed politics of the government. Will it take a year to rebound? I don’t know. But the 240 million people consuming a lot of goods are not going anywhere.

You’re also chairwoman of WPP’s Vietnamese operations. How do the two markets compare in your view?

Vietnam has had a tough time over the last three years for a whole lot of reasons, but they’re coming out of it. From talking to clients and bankers, I get the sense that Vietnam is moving upwards again. The difference is that it’s not going to grow the way it did in the past. It will be more measured growth. Consumers are more savvy and have more access, so they won’t be as easily led into buying stuff.

Indonesia will grow. As I’ve said, the foundations of the economy are strong and the population is high. We just have to be patient and see how things pan out on the political front.

Indonesia was the golden child for the world. This is why the fall is harder to accept. There is still a lot to do. There are many pockets of growth that haven’t been touched.

Where is that untouched growth in Indonesia?

The second tier cities and the outer islands. Someone I was talking to in the property business recently said they were going to build 50 malls in a year in cities where there was no supermarket or mall. There is a propensity to spend in those markets. The volumes come from the large cities, but the growth comes from the second tier cities.

And that growth will come from tapping into digital. Clients and agencies are lagging way behind where consumers are. If TV spend is down, then you need to think about other channels. And in Indonesia that channel is mobile. It’s taken a time for us – including the creatives, the planners and the tech guys – to realise it. But if you’re not seriously investing in mobile, then you’re probably wasting your clients’ money.

What do you see as your biggest obstacle to that happening?

Metrics. Some clients have jumped in at the deep end with digital. Now, they need to step back and figure out what’s working and what’s not.

We need a simple measurement system that allows the client to make sense of where they’re spending and give them confidence to spend more in the right medium. We’ve confused the heck out of ourselves never mind our clients by using so many different metrics. Which partly explains why digital is still only around seven per cent of spend in Indonesia.

We’re now looking at working with publishers and with the clients. Let’s get together and ask what we should be measuring. Unique visitors? That time has passed. We need to start asking harder questions. What do clients want, how do we measure it, and how do we make these measurements comparable? If they have 100 dollars to spend and ask to spend 10 with Kompas or KapanLagi, how comparable is it? We need to set standards for measurement. We owe it to our clients.

WPP has set up an advertising school in India, your country of origin. What are the chances of bringing WPP’s ad school to Indonesia?

GroupM Media Masters - the first batch

GroupM Media Masters – the first batch

We’ve been talking to educators for the last two years. So yes, it could happen. There is a lot of talent here and they’re young, creative and enthusiastic. The unpolished diamonds are there. The challenge is shaping graduates for the real world.

We’d been saying that for years. So a few years ago, we launched Media Masters [a one-year marketing and media training programme]. We had to sell the business to students. We wanted to make media sexy, attract young people to the business, and invest time and resources in training them for the real world of marketing and media.

You can wait for the education system to change. Or you can say we need to do this now, because it will help the industry grow. We’re not in the business of education, but we know what the industry needs. The course is taught by real practitioners, not academics.

And it’s not just for agency people. It’s for young clients too. WPP does not exist in a vacuum. Emerging young clients need to know about the new retail environment, new distribution and measurement systems – and they’re not taught this on their undergraduate courses.

What’s your favourite campaign created in Indonesia?

My favourite for the last SEA Games in Indonesia [in 2011]. There was a lot of negative publicity surrounding the Games, but Unilever stepped in as a sponsor less than 13 weeks before the start. There was very little time, and it could have gone the traditional sponsorship route. But Mindshare started a movement. We created an anthem, ‘Ayo Indonesia Bisa’ (Come on, Indonesia, we can!), that called on Indonesians to get behind their country. We wanted to bring some pride back into the Games. I remember getting goosebumps when I heard the crowd sing the anthem when Indonesia played the Philippines in a soccer game. The campaign won a Unilever global digital award.

Which agencies do you think are doing good work in Indonesia (besides WPP agencies)?

On the creative agency scene, Lowe are doing well. In media, Dentsu Aegis and Starcom are performing solidly. But I’d hate for us to be competing only with our rivals. We need to compete much harder with ourselves. We shouldn’t worry about our competitors so much. Martin Sorrell [WPP’s boss] talks a lot about “horizontality”, which is about getting us to work together more as a group. It’s about how we work closer and cooperate with our sister companies. Clients don’t have the time to do it all. We need to make their lives simpler and give them as many answers as we can in a cohesive answer.

Indonesia is an incredible market. Why has it been overlooked by the trade press? Mumbrella is guilty of this too, we admit…

Indonesians are culturally very shy. They don’t boast. If you take that at a country level, the country has never showcased what a great place it is. But think back a decade. After the 2008 crisis, the world suddenly woke up to Indonesia, a country that hadn’t had much attention before. It then got its rightful place on the global stage.

But to say Indonesia isn’t given enough attention now? Well, Martin Sorrell has been coming here since 2006, and for the last four years he’s been coming here every year. How many other agency heads come here? He saw before what he sees now. He visits and looks at what needs to be done, and he’s pushing us to do more. Indonesia is high up there in the Unilever world. One of L’Oreal’s largest factories was inaugurated here. Those more visionary companies that think big are here. Indonesia is not like India or China where everyone blindly goes there. But the smarter companies do.

What about tourism? Indonesia does not have a strong country brand. Why hasn’t there been a campaign like ‘It’s more fun in the Philippines?’ or ‘Incredible India’ to give the country a stronger identity?

Yes, this needs to happen. We should be promoting Indonesia internationally more. Culturally it’s not acceptable to boast, but country branding is key. It shouldn’t be too difficult to produce a very compelling story about Indonesia, which has a great platform on which to position itself. But this requires senior ownership in government to get all the pieces together to make it work.

What are your hopes for growth in Indonesia this year?

The numbers will be what they’ll be. What I would hope for this year is that some of our companies that have invested in the right areas will start seeing the fruits of their efforts. For all of us, it’s the right time. We’re not seeing the mad growth we’ve grown used to. This could be the turning point for the industry to say the way we’ve been doing things is not good enough. We need to reinvent ourselves, starting now. We need to put the right foundations in place. And we need to work with clients to seize the opportunities that are unfolding right now, in areas such as retail and e-commerce. That’s where we need to start reinventing ourselves.

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