MARYLOU ANDREW: WPP has recently acquired a 30% stake in your business. How and why did this happen?
QAZI FAKHIR JAMIL: In mature media environments, digital has gone from being the fifth or the sixth in the marketing mix (and from being less than one percent of the marketing spend) to being number two. It has superseded print, radio and activation and is second only to TV, and by 2016, TV and digital spend are going to be at par. Traditional agencies are skilled as far as traditional advertising and creative is concerned, but digital is relatively new. It is what we call the TMT sector – technology, media and telecom – which means it is not only creative and therefore traditional agencies have two options; they can recruit people with a digital skill set or they can buy minority shares in digital agencies and pitch that service to clients along with all the other services they offer. That is the broad objective behind what WPP has done. As to how it was done, JWT Pakistan is WPP’s only wholly-owned subsidiary in Pakistan so the money has been invested through JWT.
MLA: How will things change for Converge as a result of this development?
QFJ: JWT and Converge will continue to work as two separate companies. When they need our skill set, they will ask us and vice versa. We receive multiple briefs from JWT requiring us to do the digital bit. For the client this is an advantage because from creative to digital it is a one-window operation.
MLA: What are the benefits to Converge and JWT?
QFJ: In terms of Pakistan’s digital market, we have our skill set, our content licenses, our client base and the work we have already done, so JWT benefits from a kick-start based on what we have already achieved. JWT, on the other hand, has a lot clout, a great deal of research as well as knowledge from international markets; there are things being done internationally which may become applicable to Pakistan in the next six months for which we don’t have the skill set yet, and we can now draw from the JWT network for that. Then there is the research aspect; there has been no formal research in terms of social media and the internet in Pakistan, so while doing our own research, we can subscribe to JWT’s research as well and be in a position to provide solid numbers to our clients for the ideas we suggest.
MLA: How have client attitudes towards digital media changed within the last year or so?
QFJ: Some of the larger brands are forecasting that they will be spending five to 10% more on digital in the next 18 months, and when you go from spending Rs 40 million to Rs 200 million, you start thinking very seriously. For the last four or five years we have been advising companies not to think about digital in terms of campaigns, because what you do on digital never dies, it is a legacy. The idea is that before you take the first step with digital, you need to know what the fourth step is going to be. A lot of companies have stopped thinking in the conventional way and are now thinking long term, where digital is connected to conventional, creative, to CSR, PR, etc.
#### Following WPP’s recent acquisition of a 30% stake in Converge Technologies, CEO, Qazi Fakhir Jamil talks to Marylou Andrew about what this means for the company and how mobility-based solutions are changing the face of digital media in Pakistan.
MLA: How do you sell a long term investment in digital media to clients who have never done it before?
QFJ: We start by telling clients about the digital mix. We talk about a particular brand’s target group (TG) and how digital has become part of their lifestyle. For you and me, this means spending more time on Facebook or Twitter, but there are plenty of people who have no access to the internet, so can they be part of a digital campaign? Traditionally speaking, no; but as far as we are concerned, it can be done. When clients tell us about their TG, out of the digital mix we pinpoint the medium they should be using. As an example, there is a research for a local soap brand which tells us that 90% of their TG has a mobile phone, which they use for multiple uses; this is true for many brands. Therefore we have used several mobility-based solutions to target people in the rural and urban areas.
MLA: Can you give me an example of how mobility has been effectively used?
QFJ: If you go by the statistics, mobile is the clear winner. It has engagement, call to action, reach, trail, ROI, profiling, etc. Recently, we have been taken on board as the digital agency for the Aman Foundation; they have an ambulance service as well as a lesser known service called Aman Telehealth. The latter is a tele-doctor service for SEC C and D, who don’t have immediate access to medical health facilities or can’t afford to pay the Rs 300-400 doctor’s fee. Now for this TG, we didn’t suggest Facebook or Twitter, instead we went with mobility and offered ring back tones and outbound calling. Then the client decided to target specific localities within Karachi so we did location-based campaigns. This is one example and the options are limitless.
As more research is carried out, mobility is bound to pick up. How will mobility affect SEC A+, A and B? Perhaps in the form of QR codes, mobile applications, etc. 3G will change things for people in urban areas but that is still six months to one year down the road; as far as the rural customer is concerned, brands need to start using mobility as of yesterday.
MLA: You say that Converge is a content driven company. What does that mean for your clients in practical terms?
QFJ: A lot of people don’t know what content is because they think of content in terms of TV, although there is more to it. Converge had the copyright regime implemented as far as mobile content is concerned in Pakistan. We approached the Pakistan Telecommunications Authority (PTA) and they wrote to all the mobile network operators (MNOs) asking them to use copyrighted content, as a result of which all the MNOs use legal content for ring back tones, etc. Because of this, companies such as EMI have been revived; in fact almost 80% of EMI’s revenues come from mobility. Converge now has approximately 32 labels across Pakistan making us the largest aggregator of Pakistani content. We have content in regional languages, devotional content, humorous content, Bollywood movies, Pakistani dramas and stage shows. For us, content is just data; that content can be shown to you on an iPad, iPod, mobile phone, laptop, YouTube, cable, etc. Based on the rights we have, we supply content to a lot of content providers, platforms and operators. Another type of content is what we create for clients based on their demand. This includes viral videos, testimonials, voiceovers, Facebook and desktop applications. In a month or so, you will see lots of content driven properties which are backed up by very large brands.
MLA: Is content becoming more important to brands?
QFJ: Brands are thinking beyond the 30-second TVC because the life of the TVC is fading. Dramas like Humsafar are very popular but only a certain TG watches dramas on TV; others watch it on YouTube and then what happens to the brand’s TVC? Once 3G comes in, people will be able to watch TV on their mobile phone with greater ease. Suddenly the TV channel’s fixed point chart has gone out of the window and companies are thinking about how to embed their messages within the content itself and how to take advantage of multiple avenues for content viewing. As the screen is becoming bigger, it is also becoming smaller.
MLA: What are your predictions for the next three years?
QFJ: Companies which have signed up digital agencies for the long term are early adopters and they are setting the pace. In the next three months they will take the lead in the digital arena.
I believe the digital market will double every year for the next three years.