Five top trends facing adland’s talent in Asia-Pacific

Trend 1: Network agencies' digital offering is shifting

As we all know, and have heard repeatedly at various industry events, digital is now pervasive. Although only 2 billion people, or a third of the world’s population, are online, 82 per cent of the world’s income sits with the top 30 per cent of the population (Source: Henry Blodget, Future of Digital). As a result you cannot have a communications conversation without digital being a key part of that conversation. The implication for the network agency structure is significant.

2012 has seen a convincing drive by the so called ‘traditional’ agencies to digitize and hire talent that can not only engage at a brand level, but also genuinely have meaningful digital conversations. The most interesting element of this trend is how the so-called digital offerings of the network agencies such as OgilvyOne, Tribal, Arc, Proximity, Wunderman are changing. Perhaps a step back in time whereby they continue to specialize in all things data- and CRM-related but are no longer driving the digital agenda?

Trend 2: Boutique offerings in Asia are limited

In the West, network agencies are having a challenging time. They are heavily reliant on network clients whose budgets are being cut, and there has been a groundswell of diverse startups offering both clients and talent refreshing alternatives. This is not the case in Asia, where the network agencies still dominate in the minds of both client and talent. Yes, the likes of W&K and BBH have fantastic reputations and are certainly talent-magnet brands, but they are tiny (BBH has approximately 250 employees) compared to the multinationals (Ogilvy has approximately 9000 staff).

In order to succeed in Asia, agencies need one or two prominent network clients to provide the vertebrae for the business, from which they can then build a local offering. Boutiques find it harder to break into these network relationships, which makes it a hugely difficult region for challenger brands and startups to take on the big boys.

Trend 3: Western talent aspires to break into Asia

Talent from the West continues to be hugely interested in a move to Asia-Pacific. Think of the legendary, multi-award winning Graham Fink’s move from M&C Saatchi London to chief creative officer of Ogilvy and Mather China. However, without any prior experience in the region it is increasingly difficult for them to do so. A talent gap still exists in many markets, but this is evolving as the markets mature and more and more value is being put on local experience.

China is a classic example. There are still a number of expatriate agency leads, who are predominantly individuals based in the region for a long time and who genuinely know their way around. In all of the recent China leadership searches we have worked on in the last year, language and local experience has been mandatory. The role for senior expatriate account management talent is becoming limited to multimarket account lead roles, which are few and far between.

Trend 4: Western talent is more affordable than expats in the region

Despite the fact that is becoming harder for expatriate talent to break into Asia, it is now often more affordable to hire talent from outside the region. Salaries in the West have been stagnant these last few years. The weakening of Western currencies against Asian currencies has been a contributing factor.

Tax rates in most Asian markets are favourable and likely to become more so. And combined with a continued interest in talent from the West, there is a wealth of supply. All of these factors mean that when you analyse the packages, you often get more value in terms of experience by recruiting from the West (with the exception of the US, due to double taxation) than by hiring expatriate talent (of any nationality) who have been here for a few years. 

Trend 5: Singapore is an important regional hub, but a tough local market

Singapore continues to benefit from the multinational clients basing themselves there. The likes of Diageo, Unilever and particularly P&G continue to invest heavily in the market. In recent months we have seen more global hubs being relocated to Singapore from the West, which is great for the region and the industry in this part of the world. However, despite the influx of multinational clients, the market continues to be very tough at a local level.  Although unsubstantiated, someone recently told me that in 2012 there have been 227 local pitches with only S$17 million in revenue attached. Whether the numbers are totally accurate or not, they are illustrative of the challenge in Singapore.

The expectation from global management is that the ‘local’ offices should be growing. This is a tough challenge given the shortage of significant local accounts and the competition that exists from the multinational agencies chasing the same business and some local shops who can undercut on price.