Publicis Groupe Middle East’s first ever chairman, Raja Trad, talks integration, collaboration and agency undercutting
“Tough? Yes it’s tough. When you talk about a drop in advertising expenditure of 45 per cent in four years, it means it’s tough,” says Raja Trad, the chairman of Publicis Groupe Middle East. “But let me be very honest. If we lose optimism, it’s going to be detrimental to us all.”
Trad is sitting quietly in the Dubai Media City office he has called home for years and, on the surface at least, nothing appears to have changed. He is still well dressed and amiable, still succinct and to the point, and still simultaneously positive and realistic. But of course everything has changed, not least his job. “It used to be simpler,” he says with a smile.
“I’m not a magician. I’m a practical businessman.”
Industry-wide transformation and regional economic uncertainty have meant the Dubai-headquartered advertising industry has struggled in recent years, not only in terms of growth, but in terms of relevance. Compounding these conditions has been a tendency for some agencies to undercut their competitors, thereby killing the industry, says Trad, and undermining the value of communications.
“We need to be respectful to ourselves first of all,” says Trad. “In so many cases we know for a fact that we came number one in the technical [aspect of a pitch], only to discover later that we lost the business. Why? Because of the financials? Why? Because there are some agencies that are willing to go and take the business at break even or at a loss, which I don’t understand. I’m a businessman and, for me, if the client is expecting me to lose money or break even, I do not want the business.
“It’s my right to make money. If I want to make 5 per cent, or 10 per cent or 15 per cent; it’s okay; this is a free market. But we will be killing the industry if we go and buy our business. Buying business will not make you able to retain the most important thing in our industry – people. If you want to attract good talent, if you want to retain the talent that makes a difference to your clients’ businesses, you need to recognise their performance. And to recognise their performance you need to make some money. So to break even or to lose money… it doesn’t make any sense.”
Is it a big issue?
“It is an issue. And because the markets are getting tougher some agencies are willing to lose money, but don’t ask me how they compensate for it. I need to make people feel that there is hope for the future. That I can increase their salaries, that I can give them bonuses, that I can appreciate what they are doing. But if I go and settle for losses that’s not possible. Maybe they are magicians. I’m not a magician. I’m a practical businessman.”
Formerly chief executive of Publicis Communications Middle East, Trad was appointed to his new role as chairman in June last year and now sits at the top of Publicis Groupe’s regional empire. That means overseeing Publicis Communications, Publicis Media and Publicis Sapient, with the communications hub alone including Leo Burnett, Saatchi & Saatchi and Publicis Middle East. All three agencies now reside in the same building in Dubai Media City.
“…There are some agencies that are willing to go and take the business at break even or at a loss, which I don’t understand. I’m a businessman and, for me, if the client is expecting me to lose money or break even, I do not want the business.”
When he first took on the role of chairman Trad was tasked with driving greater integration across the group’s capabilities, with the aim of transforming Publicis Groupe’s relationship with its clients, cultivating and attracting the best talent, and improving its resources management across disciplines and solutions. This has not only meant more work and more responsibility for Trad, but considerable change in terms of how the group operates.
Like all other groups it has undergone considerable transformation, bringing in new skill sets and new priorities and frequently going to market with a unified, group-wide offering. For the McDonald’s account, for example, it has created one team that is drawn from all disciplines. Similarly, the bespoke agency Publicis Emil has been created for Mercedes-Benz globally.
How far will this integration go? Could Leo Burnett be merged with Saatchi & Saatchi, for example, just as WPP’s J.Walter Thompson has been merged with Wunderman? “No, we will respect all the brands that we have,” replies Trad. “There is a place for Saatchi & Saatchi, there is a place for Leo Burnett… and there’s no reason why we will not protect and even enhance what we have in our different offerings.”
“This year will be a continuation of what we have already started,” adds Trad. “Where we will bring all the offerings and all the brands that are working under Publicis Groupe closer together so that we can give our clients a competitive edge that they do not see with other groups. Honestly, this is my priority. Seamless collaboration.”