Bouwer, a qualified chartered accountant who joined the group 14 years ago, also acknowledges a continuing and significant shift in the industry over the next five years, as people directly engage with their brands and real money is spent by clients on defining how that engagement happens.
"Presently we earn 60% from advertising, with the remaining 40% of our earnings coming from marketing services. I expect that marketing services will show far greater growth in the future. Within 5 years, we expect that two thirds of our income will come from marketing services as we build further on our ability to offer more specialised services to clients in areas such as brand strategy, insights and research, PR, design and IT-based applications."
Bouwer says he wants to help develop a marketing communications group that has the best in breed in all disciplines, "as we currently have in advertising with TBWA\Hunt\Lascaris, PR with Magna Carta, strategy, research and design with Yellowwood. Whilst protecting the independence of our businesses, we are aiming to drive far greater cohesion between them enabling TBWA\ as a Group to deliver truly great ideas for our clients in a seamless fashion."
2010 has been a mixed year for TBWA\South Africa, he admits. The global economic recession was hard-hitting with previously "indestructible brands taking a knock." As a result only some TBWA\ clients maintained their ad spend while others spent less. "We did have some clients cutting their budgets," he says, "but we also enjoyed significant growth with others."
Bouwer adds that the group kept true to its values by not compromising on excellence even in tough times. " One of the areas we worked really hard at was bringing our collective Group expertise to clients in an effort to drive organic growth. We are fortunate to have built a group that comprises of businesses with similar values that buy into the broader vision of offering cohesive solutions to our clients," he says.
The evolution of social networking is also challenging the way advertisers see consumers in a changing market place. Deloitte&Touche's annual State of the Media Democracy survey, which studies media trends, reveals that traditional advertising still remains the most influential, while online advertising is declining. The survey was conducted on 12 991 consumers in seven countries including Brazil, Germany, Japan, the United Kingdom, the United States, South Korea, and India.
"It is an interesting but unexpected trend in developed countries," Bouwer says of the study. He however feels that as accountability and measurement capabilities are improved upon in the digital and social media environment, this will change. Bouwer believes that the digital and social media space is a definite future growth area for TBWA\South Africa. "In future, traditional media will be used more to steer us to digital media and that will give it traction. It's about credibility, accountability and volume," he says.
Bouwer would also like to see a lot more focus being placed on future growth and development in Africa. He says the group is aiming to capture more spend from existing clients in Africa and global clients wanting to get into Africa.
TBWA has 22 offices in 17 sub-Saharan countries (excluding South Africa) and Bouwer said that for anyone to succeed on the continent the approach has to be right. "We are a partnership of equals, and we acknowledge that we have as much to learn from our partners across the continent as they have to learn from us. This being the case, we believe that Africa will play a major role for us in developing our own capabilities."
Some of the agency's major pan-African clients include Standard Bank, Nissan and Tiger Brands. "Whilst we will continue to work hard at cementing existing client relationships through our network in Africa, I believe that our ability to effectively partner with the agencies that form part of our TBWA\Africa Network will become one of our most appealing attributes to potential new clients."
Bouwer is keeping a close eye on the increasing investment in Africa by new economic powerhouses India and China. The former's involvement is driven by its private sector, whereas China's push into Africa is led by the state. A recent Harvard Business Review article reported that India invested $2-billion in the continent last year, while China's investment was $8-billion.
"We're seeing more and more involvement from these two countries - especially China - in the rest of Africa. Where there are opportunities for us, we will certainly chase them. As a Group we're well equipped to take on the challenge. We are conscious of the need for localisation, and have done it successfully for several of our clients, especially in Africa. We have a global network, vast experience in Africa and the ability to operate across developing and developed markets. We've got a broad communications and marketing services capability, we involve our agency partners early in the process and, where required, we second South African creatives to assist teams elsewhere on the continent in developing the best possible solutions for clients."
As important as expanding TBWA\'s capability to develop and deliver solutions to clients is the need to develop a remuneration structure that properly rewards us for those solutions and ideas. "There's a greater need to demonstrate our effectiveness as well as understand our clients' expectations and satisfaction levels as these are all key drivers in the development of remuneration models in the future."
Consumers are now more careful with how they spend their hard-earned money, Bouwer continues, while marketers will always expect that advertising delivers more to make consumers spend more. "Everyone is bottom-line driven, and this manifests in clients' demand for increased return on investment. Clients want value for money and they want results. In future, our remuneration will strongly depend on the quality of our ideas and the effectiveness with which we implement them. Until now, we've been rewarded on input, rather than output. In time, we expect to see a change there," says Bouwer.
The creation of a successful group is a critical objective, he says, especially a group such as TBWA\South Africa that refuses to be defined by just advertising but insists on being defined by their ability to create great ideas. And although it has enjoyed award-winning success from its inception 25 years ago, Bouwer remains of the view that there is always room for improvement. "We need to drive deeper understanding of our clients' businesses and we need to focus on all of our capabilities to support clients in solving their business challenges. I believe that this will enhance our credibility with clients, and enable us to tap into their willingness to invest in us as a business partner."
