Funny how you can adjust your perceptions. Everyone in the Lebanese marketing industry, be it creatives, ad men, media buyers or PR flaks, will tell you that nothing has happened in Beirut for the past two years, due to the political upheaval that strangles the country’s economy. Still, when asked how 2007 went, many will answer, “Surprisingly well,” adding that they managed to sustain business and not fall behind.
HIERARCHY OF DISASTERS. “This is the civil war syndrome,” says Ibrahim Lahoud, deputy general manager at Publicis Graphics. “For 15 years, Lebanese people learned to become flexible. So after a terrible year in 2006, the market adapted – clients as well as advertisers. We all know that if we keep waiting for good news, nothing will happen.”
This resilience was most clearly shown in the way that, despite an unstable environment, agencies stuck to their projects, coming up with contingency plans in case something went wrong.
“If you sit around and wait, waiting’s all you’re going to do,” says Kamil Kuran, managing director of Leo Burnett, Levant. “So we took an active decision to proceed as planned while always having a back-up plan. It’s simply a different mindset of operating. There’s a hierarchy of disasters that you have to anticipate. But, of course, it’s draining.”
Monthly variations in ad spending show how hard business has been hit by Lebanon’s security issues this year, with figures dropping by 6.4 percent in July and 8.3 percent in August, before increasing by 47 percent in September.
“Seasonality has faded and been replaced by opportunity,” says Eli Khoury, CEO of Saatchi & Saatchi Levant. “Whenever there’s a breather, clients dump all their money in. Business has been steady but it’s nowhere near what we would have expected in ‘normal’ times. That would be five times what we have today. Our current work allows us to sustain growth and meet expenditure, but it’s jeopardizing our dreams of enlargement and future projects. People are fed up.”
LOOKING ABROAD. Prices were adjusted, resources were reallocated, and agencies branched out. Publicis Graphics, according to Lahoud, garnered 30 percent of its billings this year from regional accounts, compared to 10 percent before the 2006 war.
“The fact that business has been stagnant in Lebanon pushed us towards other countries,” says Burnett’s Kuran. He mentions Leo Burnett’s Jordan operation – opened in 2005 – where business is growing at 20-30 percent each year. The agency is expanding its Syrian office too.
He adds, though, that some local clients have also shown a determination to keep promoting their business through tough times. “We have a portfolio of local clients who believe in investing in their brand, like Exotica,” he says.
DOWNSIZING. “In Lebanon, we had fewer major campaigns, so we moved to smaller and more flexible clients,” says Lahoud. The agency’s whole approach to business has been modified.
“We thought through our pricing and we have reduced our margins,” he says. “For instance, our commissions now vary according to the client, without ever compromising on quality. We also implemented a holistic approach, providing a year-long strategy and acting more as consultants. Which is why we shifted all our clients to a retainer fee system that allows us to better control our cash flow. It’s far more efficient than the traditional quotation/approval system. That helped us a lot this year.”
If the political situation doesn’t erupt again, Lebanese agencies have cause to hope that they will be able to plan further ahead in 2008. In Lebanon, though, that’s a big if. And 2007’s practice of contingency planning may well come in handy next year.
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THE AD MAN
Philippe Skaff. CEO of Grey Worldwide.
What was the biggest pitch Grey won in 2007?
Al Arabiya. Not in terms of budget – it’s one of our smallest – but in terms of quality and emotion, which is still part of the mix for us. Al Arabiya is unique among news channels. It’s very moderate in its culture and approach. We didn’t have to focus on a commercial product, but on a reforming cultural current in the Arab world – where people are more used to flashy media. So we had to come up with a new brand approach and a long-term campaign consisting of a whole communication policy, rather than a simple tagline. It’s a campaign we can build on. It won’t go out of style.
And the biggest pitch you didn’t win?
Qatar Airways. We worked on it for five months, right up to the final decision, but in the end no regional agency got it. It’s a pity. We did good work for the Asian Games in Qatar, and Qatar Airways is set to become one of the most sophisticated and sought-after carriers in the world.
How have you coped with the two-year standstill in Lebanese business?
There are cycles in Lebanon, it’s like a rollercoaster, so we saw this coming; that’s why – even though we have our headquarters here – we’ve developed strongly abroad.
Only two percent of our income is generated in Lebanon, against eight percent three years ago. In 2000, we had three offices abroad, now we have 11, and more are coming.
We also activated brands that were kind of dormant – like our PR agency Grey Communication International (GCI) – and created new ones. We’re currently establishing Grey Healthcare, the first agency worldwide to focus exclusively on pharmaceutical and hospital communication and lobbying.
Any other big changes for Grey in 2007? We signed one of the world’s top 10 creative talents, Danny Higgins, as our new chief creative officer in November. The fact that he agreed to join us shows that the Middle East can now be a step forward in a successful international career.
In the 1980s, because talent was lacking in the region, you saw a lot of European creatives coming over. And more often than not they either didn’t have a real career or couldn’t get a job in Europe.
In the 1990s, local talent emerged but we didn’t succeed in getting international recognition. International companies are mainly interested in making fast money and I accuse them of cultural racism: they only see the region as a cow to milk. They have no interest in promoting quality here. Besides, creative people in the region are not conditioned to break these shackles, they deal with the situation without trying to change it.
That’s why we decided to start changing things by investing in Danny – and I do mean investing – who won’t be content with admiring his bellybutton and congratulating himself over local awards that don’t mean a thing. We hope to create a whole new generation of creatives. The talent is here, it needs to be refined and channeled in order to make an impact on the international scene.
What was the most notable occurrence in regional advertising in 2007?
The proliferation of real estate ads that all look alike, like they share the same DNA. It’s such a boring sector, despite huge spending.
What was the advertising world’s buzzword for 2007?
Digital media. It’s kind of scary, these words sound cold, dehumanizing. But since the only constant is change, we have to be flexible.
And for 2008?
The three Ts: transparency, trust and talent. We have to go back to our true values.
What’s your New Year’s resolution for Grey Worldwide?
To turn the regional scene into an international platform.
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THE PR BOSS
Joe Chemali. Communication director for the Levant at MS&L.
How would you describe the PR industry in Lebanon today?
The Lebanese market was never PR driven, due to the lack of multinational companies operating out of Beirut. In general, PR has always been considered a luxury compared to brand advertising. Companies operating in Lebanon set lower budgets for PR than advertising.
PR has always been seen as a tool to organize themed events and back them up with some media relations. We rarely encounter challenging opportunities for reputation management, public affairs, crisis planning, CSR and other specialized PR techniques. PR agencies are only judged by the success of an event and by column inches.
So how do you manage in a market that got even slower in 2007?
Unfortunately, while other markets are booming, PR in Lebanon is moving backwards. That is why most of the local PR agencies directed their attention towards the Levant region, and mostly towards Jordan.
We were able to position ourselves as one of the big players there, with clients such as Abdali (the new downtown development in Amman), Mawared – the largest real estate developer in Jordan – and other large scale companies and brands. We’ve succeeded in creating a credible reputation for ourselves while waiting for the unstable local situation to get better.
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THE MEDIA BUYER
Wilson Issa. General manager, Starcom Worldwide.
What event had the most significance for media buying in Lebanon this year?
We all had to adapt to a very volatile situation, which meant coming up with endless contingency plans. It’s a challenging environment to work in, and it hasn’t been rewarding much. A lot of things took a lot of time to materialize.
So would you describe 2007 as a bad year?
No, figures are surprisingly good considering the general pessimism. But all that was going on was bits and pieces. No major pitch happened.
So how did you manage?
We handle the Levant region, so we always had contingency plans in Syria and Jordan where a lot is happening in the media. Many Lebanese agencies will tap that market.
We adapted the whole network, the Lebanon office couldn’t be separated – otherwise we would have incurred serious losses. We needed to be flexible in terms of timing, maneuverability, reaction. Now, you can book and cancel a campaign in ten minutes.
Regionally, any big wins?
Of course. We renewed Nakheel, and got Coca-Cola in Egypt.
What’s your New Year’s resolution for Starcom?
Keep our heads up. It’s a simple formula: if you do things right, you’ll win.
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THE CREATIVE
Iyad Zahlan. Creative director of TMI-JWT.
What was the biggest pitch TMI-JWT won in 2007?
The Casper & Gambini’s worldwide win was one of the highlights. The launch of the new awareness campaign on climate change for Indy Act is our greatest emotional win of 2007.
How have you coped with the current standstill in Lebanon?
We’ve had to be smarter, more energetic, and work twice as hard to confront the status quo. The stalemate demands that agencies change their modus operandi. There’s no more room for a one-sided conversation.
Has there been any significant trend on the Lebanese ad scene?
There wasn’t any significant event but the political campaigns and the sporadic outburst of patriotic campaigns marked 2006-2007. They must have left some sort of impact on someone, somewhere. Or not. It depends whose side you’re on. Luckily JWT has a policy against political campaigns.
Which campaign most impressed you this year in Lebanon?
I admire the thinking behind the work for AMAM [a public interest campaign by H&C Leo Burnett tackling sectarianism]. Oh, and hats off to the marketer that came up with the plastic surgery loan [Lowe Pimo Beirut for FNB bank].
What’s your New Year’s resolution for TMI-JWT?
To make everyone else jealous.
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