Experiential Marketing: The Changing Paradigm
From relative obscurity about two decades ago, Experiential Marketing/Brand Activation has gained so much prominence especially within the FMCG sector. The coming of vibrant telephony companies into the Nigerian market about a decade ago has also helped to boost this form of marketing, stamping its authority and efficacy as a marketing tool.
What is in a Name?
The Red-Hot Seven, as the title suggests, is a tribute to leading experiential and brand activation agencies. It is deliberately restricted to that number to emphasize standard operations that can and do indeed stand shoulder to shoulder with similar companies in other parts of the world.
Some of these companies, despite being fully Nigerian establishments without any form of technical affiliation overseas, work for multinational organizations outside the shores of the country.
The current lull in traditional advertising underscores the rising importance of experiential marketing among big spenders comparable to or even above advertising or public relations. This, perhaps, explains the continuous rising profile of experiential agencies.
The New Buzz
The many experiential/brand activation campaigns going on daily confirm the fact that consumers and clients have caught up with what can be referred to as today’s marketing buzz. Needless to say, the situation has led to a shake up and recreated the marketing spend graph to favour the former underdog that is fast becoming the top dog of the industry.
Some practitioners feel the increase in experiential marketing spend has taken a huge chunk out of the regular above-the-line advertising spend. Others believe that even though experiential spend is increasing, so also is ATL, although this is contestable given the situation in which budgets are continually experiencing cuts.
Reversing the Spend Order
15 – 17 years ago, the ratio of marketing spend was put around 70:30 in favour of ATL. The noose on tobacco advertising globally also had its effects and gradually experiential has helped move the figures in favour of BTL. Millions of dollars, hitherto, used for advertising tobacco have been redirected into BTL, with more undoubtedly added, such that the marketing approach has become more daring and creative.
More industries have joined the experiential gale with its inherent advantages: two way communication with consumers, opportunity for the instant feedback, first hand consumer insights as well as selling – the ultimate aim of every manufacturer.
“The consolation to ATL experts,” says Chris Parks, CEO, Chris Parks Marketing Solutions (CPMS), an experiential/events management agency, “is that you can never get rid of advertising.” However, he agrees the marketing budget spend ratio has turned full circle in favour of BTL which he says is now 70:30 in favour of BTL.
Guys are Putting David Ogilvy in a tight Corner
Recent investigations, however, reveal that Mr. Parkes and his co-travellers that believe the 70:30 percent ratios may be too generous. Key marketing staff in some multinationals who spoke on condition of anonymity put the aggregate at 22.5percent and 77.5percent for ATL and BTL respectively. David Ogilvy must surely be turning in his grave!
Today’s marketer, it appears, is not patient enough to consider the long term investment benefits of advertising and its effects on branding. Of course, experiential experts argue the concept also contributes to branding as it aids in etching the brand in consumers’ minds. Maybe, the almighty Ogilvy was wrong on this or the re-direction only confirms his theory that 50 percent of advertising spend is wasted.
While there is a paradigm shift from ATL to BTL which gives practitioners in the former a reason to reconsider their business model and re-strategize, there is also a shift within BTL experiential/brand activation community.
Experiential marketing had its break particularly in Nigeria courtesy of companies like Tequila and South African Group Africa and it’s off shoot, DMC, which together became Exp Momentum. These companies share the credit of building and nurturing professionals that have become leading players in the industry today.
While Exp Momentum Nigeria is still setting enviable records as an undisputable No. 1 player, Tequila had receded, falling out of the Red-Hot Seven zone. It is, however, commendable that the owners of this once pacesetter organization are leaving no stone unturned to get it back to its glorious past. After many transitions and rebranding, the old winning name is being restored and businesses are gradually trickling into its kitty.
The New Order
The Experiential, Activation and Events segment of the industry are currently awash with so called operators. As at last count, there are 45 companies and racket operators claiming expertise in the field. All wedding planners, flower ad balloon decorators and so on claim to be events agencies. It is amazing that some gullible marketers fall prey!
The new order as shown by the Red-Hot Seven list is led by EXP. This is followed by Towncriers, Brand Footprint, Cross Marketing, BTL Solutions, CPMS and Oracle. Nonetheless, most of the segment leaders have imprints of Tequila as their founders/CEOs are alumni of the Tequila school of experiential marketing; similar to Insight’s claim to fame as the University of Advertising in Nigeria.
Let the Job be Done
Outside the multinationals EXP Momentum and Brand Footprint – other operators on the Red-Hot Seven list are independent specialist agencies without any international technical affiliations. This is not to say affiliation does not have a place in the business. It simply highlights the fact that if five of the seven leading agencies are wholly Nigerian owned businesses, then clients are primarily concerned about getting the job done right.
Sound proprietary tool, creativity and brilliant knowledge of the terrain are some of the key requirements for campaign optimization. While technical training has been a key benefit of affiliation arrangement, their counterparts are also exposing their manpower to global best practices in the field of experiential marketing. Towncriers, Cross Marketing, BTL, CPMS and Oracle are giving very good account of themselves in this regard.
The Rating Metrics
It is no gainsaying that data is not easy to come by in the Nigerian market. With no industry billing standard, it is almost impossible to rate operators. The next available option for rating was to list the 15 biggest spenders and the agencies servicing these businesses.
Also, we considered the agency’s ability to hold unto such businesses, organizational structure, proprietary tools as well as operational spread.