Allege N4b Unaccounted Spend: Accountability and Transparency in Media Spend, Global Challenge – Okeme
As the immediate past president of the Advertisers Association of Nigeria (ADVAN), David Okeme spoke to some nagging industry issues in the marketing, media and advertising industry as it is said to be plagued by lack of transparency and accountability. While not excusing the purported unaccounted N4 billion media advertising spend in the out-gone year 2016, Okeme submits that the issue of accountability and efficiency of media expenditure is a global industry challenge. He also touches on the ADVAN brand, succession, the OAAN/LAASA issue, values to members and partnerships across board among others. Excerpts:
As the immediate past president of the Advertisers Association of Nigeria (ADVAN), can you assess your tenure on the saddle?
I think because I come from a strong branding background, I would say the last 24 months, have been months of building ADVAN into a powerful brand. I will say today the Advertisers Association of Nigeria (ADVAN) is a brand. Today, if you call the name ADVAN, the kind of emotions you get are all very positive.
We have set up sharing platforms, learning platforms and also a platform where people come and showcase their skills and get recognized and get rewarded. So, these are the platforms we have set up to leverage on the brand.
Beyond that, I will say ADVAN has become an extremely listening organization. Our members run to us whenever there are issues and we have handled very successful advocacy to ensure that those issues are addressed.
We have become very strong partners with organizations like Advertising Practitioners Council of Nigeria (APCON) for instance. On three or four occasions, we had events where the supervising minister for APCON was present. Again, we get consulted for inputs into policies. We have been asked to help put together an advertising summit for Nigeria. That is the extent that our advocacy in the public sector has been effective.
Internationally, we have taken ADVAN into the World Federation of Advertisers, a body of marketing associations in over 55 countries of the world. So, today there is a permanent slot on the council for Nigeria. It never existed before.
In addition to that, I have been an active member of the global council, so I attend all the meetings and therefore I am exposed to the best practices and development around the world. Each time I go out for those sessions and we come back, we set up a platform to share the learning. I think the last of such event was the Industry Dialogue which we had, which was hosted by Nigerian Breweries. We brought every member of the marketing ecosystem in Nigeria; from Advertising to regulators to operators to agencies, all together to look at emerging trends to look at how it will shape the practice of marketing going forward.
Over all, I think the strength of the EXCO in transition now, is in our upholding of a two values which are behind the reasons for the set up of ADVAN; which are advocacy and also training, learning and sharing. I think for this, I score the outgoing EXCO very high.
About two years ago, when you came into office, some succession issues made some members to step aside. How were you able to resolve the issues and what were the politics behind succession this time around?
Being a contestant or candidate then, I was not aware of any politics, I came into the process, I had a strong manifesto, I had a strong set of activities, and I believed that helped my emergence as the President.
What I did in my two years, which I would say has been a force for mobilization of members, is that we have been kind of very strategic in the kind of activities that we implemented. And in driving the activities, we ensured every member of the organization felt a part of the activities. At the first marketers’ conference that we had, we introduced a panel kind of system and within the panel system, we ensured that every member organization was adequately represented. That is one of the things we did that really worked for us.
We also put in place a system of direct engagement, so we had each EXCO member being responsible for certain number of members, driving a relationship across the members. We also formed teams that visited core members periodically. I can confirm to you that we were at Airtel, MTN, Nigerian Breweries, Etisalat now 9Mobile, Guinness and Unilever. I can tell you all the key members were visited and the leaders of those organizations were pitched to. From an awareness view and top of the mind awareness point of view, I think that has really helped.
For this transition that is happening, I spoke to one or two people after the election, what I heard was that they made their decision based on the candidate’s manifesto and their engagement with them.
Bukola Bandele, Marketing Director, PZ and Folake Ani-Mumuney, Head, Marketing & Corporate Communications and General Manager at First Bank of Nigeria contested for the post of the association’s President. At the end of the election, Folake won. It is really a history making event because in more than 20 years history of the organization, we have the first woman president.
During your tenure we experienced a paradigm shift in agency-client relationship, such that multinationals started hiring foreign agencies, even inviting them for pitches without consulting with their local affiliates. An example is a brewery and a dairy food companies who gave their creative and digital campaign briefs respectively to foreign agencies. What would you say is responsible for this?
I honestly do not have the detail of what you are saying but what I can say is there was a pitch process, which is what you are confirming. The two organizations you mentioned are global agencies and multinational organizations that are driven by quality of insight, quality of execution and so on.
ADVAN is not a regulatory agency, ADVAN exists, one, to drive advocacy for her members, to carry out business without any harassment. Secondly, we exist to promote marketing excellence and in promoting excellence, we see ourselves as the channel to bring in best practice solutions and try and entrench them locally.
Let’s speak of DDB as the case in point. DDB Nigeria is affiliated to a global DDB, so if a DDB anywhere in the world decides to make a pitch in Nigeria, I believe through the agreement they have, they should be able to sort it out.
Again, as I have said, all of these are side comments. Outdoor Advertising Association of Nigeria (OAAN) for instance, had written to us to say, I have this challenge with the Lagos State Signage & Advertisement Agency (LASAA), as soon as we received that, we then went ahead, booked a meeting with the MD of LASAA. We sat with MD of LASAA, we sat with MD of OAAN and we started the process of resolving the issues.
We have not yet seen a letter nor a complaint raised by any agency in Nigeria, that this is what is happening as regards the questions you asked.
The President of Association of Advertising Agencies of Nigeria (AAAN) is not just a friend, he is a colleague and we are members of Heads of Advertising Sectoral Group (HASG) and he has never raised this with me as an issue. Again, like I have said I will treat this as a speculation.
There was a Memorandum of Understanding (MoU) presented by OAAN to ADVAN during your tenure to ensure partnership that would make business relationships smoother and mutual and also resolve indebtedness issue, among OAAN, ADVAN and MIPAN. What is the state of the MoU?
Certainly, I am aware of the memorandum which was presented by OAAN, which was more around how they would want to be paid on services they offer our members and I think as ADVAN, we gave our own input. It was not a finished paper. It was a memorandum that was issued in draft and the two or three areas where we made very strong inputs were in the area of data for instance, so we told them, if you look at TV for instance, you can use Gross Rating Point (GRP) to say if I spend one million naira, this is what am getting back.
For outdoor as a medium, the data does not exist and when you don’t have that it is always a challenge. I come from a multinational background and every time we put a media plan together that feature outdoor, we get this push back, how do we calculate return on investment?
My pitch to OAAN was, can you get to a position where you can begin to calculate actually what returns our members are getting for the spend that is going into outdoor? That is one.
Secondly, OAAN wanted us to legislate pre-payment to members. Again, my response to them was, we cannot legislate, we are not a regulatory body, we can advise but we cannot regulate. As an operator in the industry, I am aware that some members even pay upfront. Ultimately, it is the strength of your value proposition to the client that will determine whether the client gets into a pre-payment agreement with you or a post payment and also, not all members have the same cash flow structure.
Thirdly was, in terms of relationship with regulatory bodies, again, we advised that think solution, think value added. There we were hearing that foreign companies making foray, there, the advice was, there is something called ‘raising the barrier’, you need to raise the barrier of your practice, such that no portfolio person can come in and take business from you.
The memorandum has gone back to OAAN who originated it, it is left for OAAN to finalize it and push it forward. By the way, our intervention on LASAA /OAAN issue was a success. If you look at our last Industry Dialogue at Nigerian Breweries, LASAA sent a full team of Directors to be there, that is the benefit of the kind of engagement we started. And I have seen somehow a rapprochement between OAAN and LASAA. I believe that positive momentum should continue.
Also, there was a political undertone issue; again, our advice was that political issues are better settled politically. In terms of practice and the relationship of our members with them, those were the top feedback we got from them.
What is ADVAN doing about media monitoring services, how equipped are they and how do you do background check on them to ensure that what they give the brand owners are authentic and correct feedback on their monitoring?
I have a multinational experience of over 20 years or so, I understand the way media monitoring works. It started in the days of media monitoring service, it was like a full recording of transmission, so if you have any doubt on what you have, you go back to a process of playback to confirm.
Before the digital era, that was what we had; now we have gone into a digital transmission that is more scientific. The whole digital thing is such that, technology is helping us to track the information we want.
With what we have now, I cannot say it is 100 percent because the systems are not 100 percent, but I was in a session with Nigerian Broadcasting Commission (NBC) recently and there is a process that is on going to come out with a tracking system for Nigeria led by foreign countries but extensive input by local players and they are engaging stakeholders to ensure that this get to play shortly.
For me, do we have a system that is 100 per cent? I will say no but do we have a system that gives some confident of value being delivered to our members? I will say, yes.
Last year, about N4 billion unspent media advertising money was during investigation discovered to have been spent and yet unaccounted for, what is your reaction to this huge waste resulting from sharp practices?
This is another speculation that I do not have any basis to respond to because four billion is not four thousand naira. I cannot speak to it because there is no fact.
Every organization has different level of capabilities in terms of managing advertising spend. You can tell me that company A or B has the same level of competency of managing advertising budget.
Advertising is a cost for an organization, it is also an investment for an organization, it is the principal factor that unlocks growth for an organization and the best way to measure the return of your advertising budget is the growth that you are unlocking.
Organizations who have cut back on budget, go and check their results, organizations who have sustained their budget or increase their spend, go and check their results and make your conclusion from there.
As a major player in the industry, are you not aware that there is a conspiracy within the critical stakeholders in the marketing services arm and the brand team on illicit diversion of media advertising money. In your period as the president, how would you describe this situation and its impact on advertising budget?
Because I sat on the board of World Federation of Advertisers, I know this is a topical issue everywhere in the world. Our last global executive council meeting was in New York and the American Advertising Association hired an Ex- Attorney General of the US to carry out a forensic examination of media buying, media placement or execution, media monitoring, looking at the practices within value chain to establish transparency – whether the client was getting value for its spend and the guy shared the finding transparently.
First and foremost, it was established that organizations who are putting the right level of support behind their business and putting the right skill and tools behind their spend are getting growth on a sustainable basis.
It was also established that when you are investing below threshold, you will struggle to get a growth. This is a principle that is global and acceptable, same in the US, same in Nigeria.
Did they find practices which you will call anomalies? Of course, they were. There were questions around the management of discounts, where contractors give discount to the agencies even in the US. There were issues around it and there were questions on whether they declare the discount transparently to the clients or not. So there were issues around agency agreement that are really specific to the expectation of both practices.
Again, how many organizations here have a robust and structured service-level agreement? This is a world biggest marketing machine I will call it, the US, they took an Attorney General who brought in a Central Intelligence Agency (CIA) and others to do a forensic. They did not give the industry all tips, so it was a balance of tips and issues and we sat to say how do we take this learning to other countries?
To say four billion Naira is missing, that is not true. You cannot make such an allegation without facts because I have not seen any fact. Secondly, for anybody to tell you that the industry is efficient or not, nobody can give you that. You can do a sector by sector or player by player analysis to arrive at a judgment. You can take two organizations, let’s say company A spent 100 million and company B spent 100 million, company A grow share by so factor, Company B did not grow share by that factor and you can say the company that did not grow share did not invest their money properly, you can have a basis.
How would you access the aggregate growth cumulatively of total advertising expenditure during your tenure?
You talk about registered members, what I can tell you that, we have a tale of two sitting, we have a set of company who understood the principle, invested and got the growth and we have another set who may be for whatever reason did not invest and did not get the growth.
Over all, we can talk growth by sector or segment, in the last 24 months or so, we have seen increase in budget behind digital advertising for instance, double the digit. We have seen TV as medium being flat to decline, Radio, Outdoor and press flat to decline. What that tells you is that it depends on the job to be done within organizations. Companies whose propositions are tailored towards young people tended to be excited about digital media as a platform.
Our role as ADVAN is not to evaluate members because we are also members; we are also subjected to the same evaluation criteria. Our job is to look at trends within the industry and look at trends within the profession and how we can help our members to tap into those trends to deliver on their objectives ensuring transparency.
One of those things I promised when I was coming to office was the situation where members start quoting double digit growth each time we see the result come. For me, if you check inflation in single digit and we are still growing double digit? We will say yes, our members are getting the ratios right, we are growing ahead of media inflation but have we achieved that across all companies? the answer is no.
Some are still growing below media inflation but I can tell you quite a number that have declared that results have strong double digit growth.