Monday, July 13, 2020

Communications agency sees big potential in CLMV countries

Jun 07. 2016
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By Pichaya Changsorn
The Nation

Havas Riverorchid’s founding partner and chief executive officer, Santiphong Pimolsaengsuriya, reveals his communications agency’s latest developments and the promising CLMV markets (Cambodia, Laos, Myanmar and Vietnam). Here are some excerpts of that int
Your experience in CLMV
McCann-Erickson sent me to Cambodia in 1995 to help set up its agency there. After five years, it started to expand to the other CLMV countries. 
There were plenty of opportunities, but foreign agencies saw there were [also] high risks. Hence I later decided to form a joint venture, River Orchid, with my foreign partner in 2000. 
During the subsequent 15 years we gradually expanded to have offices in all CLMV markets, using Thailand as our base. We had many Thai clients as well as some foreign firms that had their bases in Thailand. 
Then last year, [French multinational advertising and public relations company] Havas, which had no office in Indochina, took a 51-per-cent share in the company.
With the acquisition, we have gained access to technology, work systems, funding sources and a larger client base, and we can get insight into the trends in developed markets, which usually lead the way into other markets. 
This is another step for the company, which has grained strengths and can serve its clients better, while also offering more opportunities for our employees.
How does Havas stand in the world's advertising markets?
There are five or six large agency groups that command about |70-80 per cent of the world’s markets, and Havas is one of them. |We are strong in Europe and the US but less known in Asia. But |our strength is not only about the size. 
While we are listed in the French and New York stock markets, our major shareholder is the Bollore Group, which owns a family business that runs many [other] businesses. 
As a family business, it does not have to focus solely on short-term profit, which is good for our business that operates in high-growth markets. 
The CLMV economies are growing by 6.5-9 per cent, with more than 10-per-cent growth in advertising.
Havas Riverorchid currently has 240 staff. Only 10-20 of them are in Bangkok, since we use Thailand as only a base to take care of our clients.
We grew by 29 per cent during the first four months of this year. 
Even though Havas is far away, it has seen that it will reap huge benefits over the long term. Thai companies should also see this opportunity. They must have courage and a risk-management system in place. 
Most Thai firms are still fearful and just send their goods [into other markets] first. But they won’t survive in these markets if they do not take things seriously. Small and medium-sized enterprises, in particular. This is because they have little experience in conducting overseas businesses. But I think CLMV can be the test markets for them, since we have many advantages such as in language, culture and proximity. They can also have border trade as support.
How do you define your company's role, a CLMV market specialist?
We define ourselves as “communication specialist”. We can help conduct market and consumer research, plan market entry, [undertake] creative works, digital communications, PR retail marketing, event marketing, and so on. 
Where we can’t help much is in distribution and legal. 
Our billing reached US$30 million last year, an increase of 24 |per cent from 2014. Most of our clients are multinational firms including Unilever, Coca-Cola, Samsung, Nestle, and Johnson & Johnson. 
The CLMV markets have very high potential. We have seen new customers coming in nearly every week, especially in Myanmar, where a lot of Japanese companies have been going to. Many Vietnamese firms have also come to Myanmar. We have also started to see some CLMV brands coming out to invest in other countries, such as Dao Coffee. 
What are among your key achievements?
We have helped SCG in Cambodia since the start when it opened a cement factory there a decade ago. We also helped it to launch a new brand, K cement, which has been the No 1 cement brand [in Cambodia] since Day 1. 
Other customers include TC Pharma, which we helped solve problems for taking its Sponsor electrolyte drink into the Vietnamese market, where consumers usually perceive that energy drinks must have a yellow colour. Gambol sneakers are also our client in Cambodia.
Thai firms often fail because they think these markets are the same as the Thai market, but they are not. The TV ad rates |in Cambodia, for example, are |very cheap: about Bt20,000 per minute, compared with Bt300,000-Bt400,000 in Thailand. Or in Vietnam, you shouldn’t use the southern dialect in a TV ad in the north and vice versa. 

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