Syndicate of Advertising: Transforming the Advertising Industry in Lebanon

Interview with George Jabbour, President of the Syndicate of Advertising (Advertising Agencies Association), Lebanon

What is the role of the AAA in Lebanon and what are your objectives as President of the AAA?

To begin with, AAA stands for Advertising Agencies Association and you are addressing this question at a key moment for the AAA. The AAA is holding a General Assembly in less than two weeks to amend major items in its by-laws including a new name for this body. To date, the AAA has served as a governing body over the advertising agencies.

During the late 90’s and the third millennium, the global advertising industry faced many changes. The classical advertising agency that contained different departments, transformed into separate companies including, classical advertising agencies that specialize in brand strategy and in creative, media investment agencies, and various PR companies as well as activation, digital, and so forth.

In a way, it is an atomization of the classical advertising agency. A governing body of a field or industry will regularly follow the potential trends and developments of that particular industry. Being in the advertising industry, I could see that the AAA did not ideally represent the industry in Lebanon.

When did you join the Advertising Agencies Association?

I took over as President of the AAA in February 2011. Initially, my task was to revolutionize the Advertising Agencies Association into a representative body of the advertising industry in Lebanon. As a result, we successfully accomplished all of the adjustments and were finally able to amend the by-laws. Hence, we have a body that can regroup all the fields of the advertising industry in Lebanon.

On September 24th, 2012 the AAA was renamed and going forward will be known as Syndicate of Advertising, نقابة الاعلان/Nakabat 2al 2e3lan, or le Syndicat de la Publicité. As of now, any company that deals with advertising in Lebanon will be able to join the Syndicate of Advertising.

Isn’t the Syndicate of Advertising just for agencies?

No, the Syndicate of Advertising is not solely for advertising agencies. It is for any institution in any communication field, be it a PR agency, communication agency, research company, media investment company, media representative or digital company.

All of these companies are dealing with advertising products. Today and probably for the first time in the Middle East, we have adapted the AAA to be an official body with a vision, integrating all the companies that belong to the advertising industry. We were not reactive but proactive. We reacted to something that may be the case in the coming 10 or 20 years. I consider the change to be a major one for the advertising industry.

What about your personal objectives for the AAA?

The problem was that the AAA didn’t represent the advertising agency, thus we had to put the legal representation of the industry into order. The first step is now complete. Our next plan is to reinforce the ethics in the industry. In addition to the required regulations, more work and effort should be put into the image of the advertising and communication industry as a whole – not only in Lebanon but also in the MENA region. The new board’s aim will be to expand the work of the Syndicate and achieve all of the objectives included in our plan.

What is the situation in the marketing industry and advertising industry in the Middle East and particularly in Lebanon?

Our industry is currently facing numerous issues. Today the communication industry, including advertising, is facing a global problem. This global problem is not related only to the MENA region. It’s not only in Lebanon, it’s not only in the Arab world, it’s not only in Europe, and it’s not only in the Far East or in America. It’s present all across the globe. The main issues are the atomization of the communication industry, a commercial drive in advertising agencies, and a redefined role of the communication industry as a whole.

How do you structure your strategy vis-à-vis the global problems?

First of all, we have a problem of atomization. In the past, we had one big agency that handled everything. Now, there is the media, the PR, the digital, and so on.

Secondly, the passion of creating and the passion for communication used to be the drive of advertising agencies. It used to be both a science and an art. Today, advertising companies are becoming companies that just want to achieve their bottom line. It is a big difference to be financially driven and to be driven by passion; isn’t it?

We were also facing another issue; we had to globally redefine the role of an advertising agency or a communication agency. Unfortunately, it happened at the same time as the world – including our region – was facing an economic crisis. In tough times, changes are and improvements are not so simple. If you know a little about the Middle East, you would know that the current situation in the region is not one to envy. Each country in the MENA region – including Lebanon – is facing a political problem, an economic difficulty, or a war; the crisis is everywhere. Unfortunately in Lebanon, everything is related to the political situation.

We are paying the price. We can still minimize the effects, but it requires more efforts to promote more communication and advertising in this country, to fight for our rights and to rationalize our costs. I don’t think we can change the situation in Lebanon ourselves.

What about the revenues? The revenues in the US have been hammered by the crisis, what is the situation in Lebanon?

Twenty years ago, agencies used to be making more money than today, so the trend was to reduce the agency fees. As a result of reducing agency fees, the service from the agency’s side had to be reduced. Today, we are turning into a vicious circle: a client asks for a reduction in the fees and the agency is obliged to reduce the fees, and no agency that is able to refuse.

So we say, “Yes, okay we will reduce the fees”. Reducing the fees means reducing the quantity or quality of the people working within a communication company, thus lowering the caliber of the people in the company. Reducing the fees means a decrease in revenues followed by a cost reduction in the agencies. We have to stop this vicious cycle. I have spoken before about redefining the role of the agency. The role of the agency can be redefined by allowing the client to feel that we are his/her “indispensable partner”. Being an indispensable partner means that you are required to have highly qualified and skilled people, therefore higher wages are needed and so you need to increase your costs. Increasing your costs will require an increase in revenue; it’s like the egg and the chicken story – which one comes first?

This vicious circle needs to be broken so that the value of advertising can return to its high level. Many clients today do not really view advertising agencies as their indispensable partners. On the contrary, clients today may ask themselves, “Why do I need an advertising agency? I can do this alone – I can book the media and I can go to the hot shops – so why do I have to pay the fees for an agency?”. This is definitely wrong thinking.

How much differentiation can be offered to the market?

There is a challenge today coming from a new type of media – the online media. We are witnessing a communication revolution of some sort. First, we had the press. Then, we had the radio which was followed by the television that killed the radio star. And today, it’s the Internet. Internet is not a trend anymore; it has become an essential part of our daily life.

I did not witness the introduction of television to our society. My parents did. Today we witness how the online element is molding the society as a whole and everything related to our daily life is drastically changing as a result.

It was probably a big revolution.

Yes, it was a revolution and the television was there – or the radio was there. According to reports, people from a village would gather into a house that had a radio and just sit there and listen to it.. The same thing happened when the television was introduced. Not everybody had a television, so the whole neighborhood was coming to one room just to watch the news or a certain program.

It’s a social-demographic change in any society, country, market, or field. Communication has existed since time immemorial. The difference today is that you are able to communicate with a huge amount of people at the same time. The challenge of the communication industry today is how to use this new media in order to communicate better.

We are adapting our understanding of communication in the classical media (the press, TV, and radio) and are copying them on the net. In the near future, we will see how the net will be integrated in the whole communication ecosystem. I remember the days when there used to be just ‘panels’ on TV. We have a come a long way from then.

The ads were like press ads – you put the panel on TV and you add the text. You literally write it down and you put it up on TV. People used their knowledge of advertising and copied it on TV. Then TV commercials started appearing and later became an art form in itself. Today the net is witnessing an introductory period like that of the TV and step by step we will notice that things will significantly change and the whole new media will be integrated into our daily communication.

How does FP7 differentiate itself from all these other agencies and where is it leading?

I head MCN, Middle East Communication Network, the holding company of several companies including FP7 the creative agency. From the perspective I can tell you that FP7 today has a new identity. Our slogan is “Truth and dare”. “Truth” is admitting your faults while “dare” is reveling in them. In terms of FP7, we are currently trying to implement a new philosophy.

Also, FP7 is part of the McCann World group. McCann’s slogan is “Truth well told”. The truth is the nature of our work. Innovation is one of the major strengths that we keep reinforcing every day by hiring talented, highly qualified and creative people, who set the standards internally first and then externally when it comes to clients.

Worth mentioning that FP7 has the international expertise with a local touch, because we are after all part of this MENA region. Our people have international experience yet are local in every market, so we have the attitude “Think global, act local” in a way. Our offices are everywhere in the region: Morocco, Algeria, Tunisia, Egypt, Lebanon, KSA, Qatar and Oman, etc. The head office is located in Dubai.

Today we belong to a group of multi-national companies which are respectable corporations. We have a list of clients who have been with us for many years and we take pride in our role as their communications partners. We have been successful together and continue to be so.