We will be ‘more equipped’ than the big agencies if there is a recession – claims GOVT

As part of a new series looking into Singapore’s independent agency scene, the three partners of GOVT –Leon Lai, Aaron Koh and Tim Chan – talk to Mumbrella Asia editor Eleanor Dickinson about being in charge of their own destiny, staying lean and the authenticity of that OCBC lie detector test

Why did you start the agency and why did you form an independent agency rather than working at a network and making three times the cash?

Aaron: “It was something we wanted to do on our own without anyone telling us what to do. We knew that we had the drive and the youth to do it at the time. Leon and I had a long conversation about how to do it – and we just said let’s go with our gut and do it. Even if we failed, at least we knew we were doing something right. The both of us strongly believed in it. And we still have the youth and drive. Doing it our way is the most important thing. It may not be the right way, but it is our way.”

From left: Aaron Koh, Leon Lai and Tim Chan

Leon: “I think our way is having honesty in the way we approach work. There were so many times we were working for network agencies and we thought: ‘Would we have done it any other way?’. There is no best way, but it’s always about the right way for you. Are we running the agency in a way that we can sleep at night.”

This last year has been good for you with the OCBC account win, but was there any point during your short four-and-a-half-year history that you thought about throwing the towel in?

Leon: “I don’t think so. When we started the agency at the start of 2013, we started very lean, with low operating costs and very low salaries compared to what we were earning before. And we hustled for business; we met people every day. We made our first hire about seven months later, but we were still paying ourselves shit money.

“Last year was definitely the best in terms of revenue, wins and profitability. The toughest part for us is right now – scaling the business from a 28-man shop to now, where we are almost 50. In the last six months, a lot has changed: the company structure, operating costs and even to how we react as leaders. None of us ever thought about throwing in the towel and we do embrace the challenges every day.”

Aaron: “When we started it, we did all say ’if this doesn’t work in two years, let’s just go and open a chicken rice stall’.”

Leon: “And were quite strict about that. Aaron was working overseas and turned down a great opportunity in Shanghai to come back to Singapore. At the time he was 29 and in the prime of his career. If we didn’t make the targets we set, then we would call it quits. Because otherwise we would be just making excuses. Tim also turned down a good opportunity to join us when we were just 15 people. But for us it’s about being proud of the work we do – not just about being independent.”

From left: Koh, Lai and Chan

But has being independent puts you at a disadvantage at times when competing for business against the bigger networks? Have you seen any change in the playing field over the last few years?

Tim: “I think if the three of us were stuck together in a network agency, we would still make the same calls and would have the same environment and culture that we have here. For sure, clients are becoming more open and agencies that used to be much bigger have shrunk a little bit. Clients are getting smarter about their selections. Some 10 years ago in Singapore, there was a lot more regional alignment. But now we are seeing a lot more local businesses who are more free to choose who they want to work with.”

Leon: “In the past, maybe there was a stigma and perhaps when we started, we perceived there was a stigma. We were three men; why would you choose [an independent] when you could be assured by a network that the work will get done no matter what because of the resources available. But now the game has changed; clients are more savvy and smarter about the types of agencies they work with, and the chemistry.”

Given the Western-centric agencies in Singapore overall, did you ever feel prejudice against you as three Singaporean men?

Leon: “That’s something that is prevalent in every industry. But no we do not feel prejudice because we feel we can hold our own against anyone in the industry. The three of us are local boys, we are Asian. In a network you tend to get your British, Australians and Americans, but do we feel intimidated? No we do not.”

A lot of agencies have said this year has been tough in terms of the revenue coming in. Have you witnessed that and do you think independent agencies are likely to struggle more during these times?

Leon: “Across the board, the briefs and the money are the same whether you are Ogilvy, BBDO or us. I like to think that we will be more equipped if there is a recession: our overheads are lower; we are much more agile and nimble. And we have constantly kept our operations very lean, and there is a war chest for us.

“To keep things lean, we don’t have any planners. And regardless of whether you are a creative or a suit, we believe you can contribute in different capacities. We reward our people with bonuses when we can. It helps because they feel involved in the agency no matter their role. Our creatives don’t just act like creatives: they think deeper; they are strategists to an extent. We always ask ourselves is this a need or a want? We could take the easy way out and hire more people, but then that becomes an overhead.”
How do you factor costs in when it comes to business development and choosing whether or not to pitch?

Leon: “We receive a lot of invitations to pitch – maybe 40 RFPs a year. But we select our battles carefully. This year we have not embarked on a single pitch. It’s not that we don’t need to,everyone loves money. I love money. But when we won OCBC last year, we made a promise that for the first six months of this year, we would not go for any new business and make sure our current clients received our full attention. And we have been very tempted at times. But it’s always a decision we make together.”

Tim: “But if we go for it, we really go for it. Pitches can be a draining process. So you have to calculate will it be good for the future of the agency. And if we do, we don’t sleep for a few days.”

Leon: “Deciding to go for OCBC wasn’t an easy decision. We knew what we were up against [Ogilvy was the competitor agency] and then there is a whole new level of responsibility for a small agency like ourselves. But we thought it would mean so much for us to win it. We went in for the experience and gave it our best shot with no expectations. When we won we were tremendously surprised. We were a 28-man shop against the biggest agency in town. And everyone kept asking us how on earth we were going to do it?

“When we released our first branding campaign, it was something nobody expected – especially from a bank. And it kind of helped us slay our own inner demons – whether we had bitten off more than we could chew.”

Have you had results from the ‘lie detector test’ campaign yet? And what did you think of the response it got on Facebook and on Mumbrella Asia’s comment feed? It seemed to provoke quite the debate.

Tim: “We’re still waiting for the results. The bank has it’s own internal figures and wants to look at them over a long-term. And whenever you put something out like that, you know it will get a response. We were just focused on trying to deliver a vision that was close to the bank. We’re pretty thick-skinned.”

Some questioned whether the lie detector was even real?

Tim: “It was real. And we look back now and we see that as just the beginning. We have a follow-up coming on a different facet of the campaign.”

Leon: “There will always be comments, positive or negative. Was the lie detector real? It was 100 per cent. The bank would never have allowed us to engage in morally corrupt or unethical practice. Was the idea rocket science? No, the bank was already adopting this practice; we were merely visualising it. We’re lucky our clients are very trusting of us.”

OCBC’s ‘lie detector’ ad

You say comments don’t matter to you, but the age of social media has put ads under an extra level of scrutiny these days. Do you think that will have an impact on and clients’ willingness to sign off certain work because of a potential social media reaction?

Aaron: “Yes it does have an effect to an extent. You cannot control what people say, but before you release a piece of work you have to consider what people will say about it. If it goes down the wrong way, you need a backdoor plan to subside the turbulence. There is no cut-in-stone formula though for social media greatness. Nobody has that. It’s just a matter of taking the comments into consideration.”

Tim: “But there are interesting rewards with social media. You can get the whole world to see your ad, whether in a good or a bad way.”

Would you prefer to have a campaign that received bad comments rather than none at all?

Leon: “I don’t think any agency wants bad comments on their work. It’s pride after all. But at the end of the day, we have to think that our work impacts people and we have to think about the repercussions. That’s a consideration before we launch or even sell ideas to the client. Is it too controversial? Sometimes things go viral on social and it’s the stupidest thing you’ve ever seen. But it gets millions of views. So is that a good campaign? And we always say, if you believed in the idea when you sold it, that’s all that matters.

“It’s not that we do not care about comments, but it’s that we cannot live our lives based on the comments we may get. Otherwise no work is going to be rolled out. That’s the truth.”

As a final point, what did you think of news about The Monkeys’ {independent Australian creative agency} acquisition by the consultancy firm Accenture. Would you say that’s a good exit option for an independent?

Leon: “Every business man has their own idea of an exit, whether it’s a holding group, a consultancy or just selling out. We haven’t thought about that option yet. At the moment we are happy, but we may get to a day when we want to explore our options. Would we want to exit or to become a bigger GOVT? For me personally, I will always be happy to work under a boss I respect. I’m happy to be my own boss right now, but it is very stressful. I have 49 other bosses to answer for [the workforce] and every day we have to answer to them.”

Tim: “There’s a great thing to be had living and dying by your own stupidity. It’s part of the fun. There are worse things to do in life.”


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