The Asia-Pacific region has always been a canvas of boundless potential and profound complexity when it comes to advertising, particularly as the digital world quickens with every technological leap.
Ghassan Harfouche, president of McCann Worldgroup in APAC is no stranger to navigating this landscape. Against the backdrop of a rapidly transforming industry, Harfouche is on a mission to enable the creative agency to sculpt the future of advertising for clients, in a region marked by its diverse tapestry of cultures, consumer behaviours, and digital advancements across APAC and MENA.
Harfouche (who is of Lebanese-descent and based in Dubai), has worked at McCann Worldgroup for the last 12 years, in his capacity as group chief executive of MCN Middle East Communications Network (IPG's holding company in the Middle East). He added the role of president for APAC to his portfolio in 2021.
Campaign had the opportunity to speak with Harfouche on his recent trip to Singapore. Below are the key takeaways from our conversation.
On evolving consumer behaviour in APAC and MENA
When it comes to how McCann Worldgroup tailors its creative strategies to each region's unique market, Harfouche says it's fascinating to observe the uniform expectations from brands and clients towards the ad industry and agency in the realm of creativity, which is McCann Worldgroup's domain.
He explains the agency defines itself as being in the business of creativity, and intends to continue championing this. These expectations remain consistent across every market Harfouche has encountered, worked closely on, or discussed in global conversations. From the perspective of similarities, he says one's responsibility for the brand extends across all channels, reaching all audiences throughout the marketing funnel. Discussions about small, independent agencies aside, the demand for more integrated brand stewardship is evident.
This consistency in every piece of communication and creative output is where he sees the industry heading. As an agency that aspires to lead in creativity, McCann Worldgroup has embraced this role and the ecosystem that enables the agency to achieve it.
"The adoption of technology by users, such as mobile penetration and digital experiences across all platforms, including e-commerce, is prevalent. This is a commonality where, again, we see a lot of similarities," says Harfouche.
"However, the fundamental differences lie in our insights into cultural nuances and how consumer requirements vary by region. Our mission remains steadfast, and we recognise these similarities globally."
Harfouche continues: "The connection with platforms and integrating data points in communication are crucial. Yet, the human element, the cultural insights, and the contextual relevance in each market, and sometimes even within each audience segment, are essential. With the ability to segment more precisely, we can understand exactly who we're talking to, when, and how."
As for the cultural differences that persistently exist, these differentiators are what everyone in the ads business must be attentive to, ensuring they have the tools, data points, and analytics to align as closely as possible with consumer engagement and brand requirements.
On flexible approaches to talent and the role of leadership
As an agency McCann Worldgroup endeavours to place diversity, inclusion, and equity at the heart of its strategy. This commitment spans globally, with McCann Worldgroup having initiated several programs to engage with its employees, and aligning the company's perspective with their feedback.
For instance, the agency has held an annual 'Day for Meaning' for the past five years across all McCann Worldgroup's offices worldwide. The agency ceases all work on the day to discuss diversity, inclusion, and what these concepts mean in different locales. It is a collaborative effort involving all staff levels to develop actionable plans addressing these topics.
"For workplace flexibility, opinions have varied from not wanting to return to the office to recognising the benefits of in-person collaboration. My view and the company's approach reflect a new reality shaped by the pandemic. We have learned from the forced experience of remote work, acknowledging its strengths and weaknesses," explains Harfouche.
"In our industry, in-person collaboration is crucial for creativity and connection. However, we've introduced flexibility, allowing employees to work from the office or remotely, tailored to regional relevancies and needs."
McCann Worldgroup also explores 'Time Well Taken' policies, allowing employees to request more leave than the standard allocation. Harfouche admits this is a balancing act, as the agency still requires active participation from its workforce.
As a leader, Harfouche says his passion for this industry is a significant motivator. He recognises he occupies a unique position, facilitating dialogue and connection between brands and consumers amidst rapid technological changes and abundant data.
He explains his role in helping brands uncover and communicate truths is 'unique and exhilarating'.
"What truly drives me is the people I work with. There is immense satisfaction in creating opportunities for others, enabling them to reach their full potential. It is inspiring to see ideas emerge from all levels of the organisation, to hear diverse voices, and to contribute to the company's collective value," says Harfouche.
"Seeing individuals progress, innovate, and grow within their careers brings me great fulfilment. Business success is crucial, but achieving it through our people and winning together holds greater significance. The manner of our victories—ethically, graciously, and inclusively—is paramount."
Harfouche adds: "It is all about the people in our business. Talent is our greatest asset, the cornerstone of our success, and we must continue to invest in and support our teams to realise and exercise their potential daily."
New talent includes bringing on board Valerie Madon as chief creative officer and Shilpa Sinha as chief strategy officer for APAC.
"Continuing our investment in talent and shaping skills across the organisation is crucial, not only at the leadership level," says Harfouche.
"We have implemented training to introduce more skills and have given time for individuals to learn and update themselves. Our structure, tools, and platform partnerships are all part of this educational effort."
On navigating market realities
In accordance with recent trends, the economic climate has noticeably softened the advertising market at a macro level, with potential global recession fears affecting spending. Interest rates have been rising to control inflation, which has led to a dampening of demand. The ongoing debate among economists is whether the industry is facing a recession or merely a period of softness, a challenging prediction to make accurately.
McCann Worldgroup anticipates a slowdown in business and is preparing accordingly to continue providing its clients with the necessary services.
The agency's parent, Interpublic Group (IPG), reported its second consecutive quarter of organic decline in Q3, down 0.4% year-on-year (YoY), pointing to decreased spending from tech and telecom clients and underperformance at its digital specialist agencies R/GA and Huge. These trends weighed on growth by 3.2% in Q3.
The US, which makes up 65% of IPG's business, decreased organically by 1.2%, against 4.4% growth in Q3 of last year, after McCann's loss of the long-held Verizon account to Ogilvy, which could potentially drag underperformance in the sector into 2024.
In APAC, IPG saw 8% of net revenue in the quarter, decreased organically by 5% due to slowdowns in Japan and China. Middle East, Canada, and Africa grew 1.2% organically on top of 10.6% growth last year.
"Whether it is a period of softness or a recession, our role as a catalyst becomes even more crucial. In times of reduced demand, our efficiency and effectiveness in driving immediate sales and fostering the desire for purchases become paramount," explains Harfouche.
"We may need to reallocate funds, but our mission remains unchanged: To think long-term while addressing immediate needs. We have experienced similar economic cycles, including recessions and periods of low demand. Historically, these phases such as a recession may last around 21 months before recovery ensues. Despite its flaws, the economic system has always facilitated a rebound."
To cope with the economic softness, McCann Worldgroup is moving towards more integrated products and capabilities, with the end goal of convergence in mind.
The agency recently launched McCann Content Studios, its new global hub for social and creator capabilities. The new studio pulls full-service social and creator strategy and execution under one roof. Its capabilities span creative, audience development, creator partnerships and performance measurement.
The new unit brings capabilities previously split across two agencies under IPG into one team. McCann Live previously handled social ITB focused on creators. McCann Content Studios will absorb both practices and unite their teams under one roof.
"This is not a new venture for us; it's an integration and strengthening of existing services to be more robust and precise. The challenge lies in producing high-quality content efficiently and at scale. We are evolving our processes to meet this challenge," explains Harfouche.
"We keep abreast of technological trends, attending events like CES with clients to brainstorm and observe upcoming trends. We also have innovation councils and partnerships with major platforms like Meta, Google, Adobe, and Salesforce, integrating technology into our work."
AI is also an investment priority at a group level, as IPG has invested in various AI tools led by an internal AI steering committee.
Harfouche believes AI offers opportunities across various sectors, including health, predicting diseases, and more. He stresses the human element remains crucial and that how the agency leverages technology ethically is paramount.
McCann Worldgroup has started using AI as a co-pilot to complement human efforts. For example, the agency used AI in Mexico to help street vendors sell hotdogs and burgers to promote themselves and highlight their quality products.
McCann Worldgroup is also testing various production tools and has signed a partnership protocol in the US to ensure the ethical use of AI.
"There is a recognition that AI may replace some roles, but it also creates opportunities for learning and skill-building," says Harfouche.
"Technology challenges humans to increase their knowledge and creativity, leading to a complementary relationship where technology and humanity elevate each other. It is a healthy evolution where technology and human advancement enrich one another."
The road ahead
Despite the global economic challenges ahead in 2024, Harfouche remains optimistic for continued growth next year, pointing to engaging conversations with clients and several wins by the agency this year in the region.
Another focus is building new capabilities and enhancing existing ones, particularly in data, technology, and content.
This focus includes connecting all elements, such as influencer products, and investing heavily in this area. For instance, McCann Worldgroup has launched social commerce initiatives and acquired RafterOne, which specialises in client commerce solutions. RafterOne is a provider of multi-cloud commerce solutions on the Salesforce platform, and will continue to focus on building around Salesforce to support clients across the IPG network who want to leverage the CRM platform
"Our resources and talent are aligned with our clients' expectations, and our capabilities ensure we remain relevant," says Harfouche.
"As I've mentioned before, we are in the business of creativity, and we view our entire ecosystem as a means to deliver the best creative solutions for our clients, whether in commerce, influencer engagement, social engineering, or any content we produce."
(This article first appeared on CampaignAsia.com)