Diversify revenue streams to cushion economic impact Okafor tells agencies
By Oghale Mafuru
Multiple competency is a veritable avenue to be strategically positioned to harness opportunities in a fast-paced world. As the economic devastation weighs on every sector of the Integrated Marketing Communications Industry, Dozie Okafor, Managing Director of PHD media has urged agencies to diversify their revenue sources through the expansion of portfolios and development of technological expertise.
The PHD Managing Director gave this advice in a webinar recently organized by the Advertising Regulatory Council of Nigeria, ARCON to evaluate the impact of the economy on the business of advertising and marketing communications in Nigeria.
The PHD boss who affirmed that the massive migration of talents and the soaring inflation is drastically affecting every facet of the industry, stated that agencies should develop competencies in other areas of growth and optimize investment portfolios to survive the economic headwinds.
He said: “In terms of future-proofing your business, there are lot of new roles agencies needs to start thinking about doing. Content development is one. Organizational consultancy is another and technology consultancy. You have to show your clients you are better at technology especially the latest.
They been hearing about it but when you become the expert at using it, the client then see why he needs you. You need to show that you are the expert in using that tool and can get the client to understand it”.
He urged agencies to invest in data and technological tools to give valuable and resulted oriented solutions to clients.
“You have got invest in data and analytics that can give you the insights that is needed to drive that client’s business forward. I think it makes for a lot more intriguing conversation with my clients when I come to the table with insights and those insights were borne out the data and analysis that we have invested in to bring it forward” he said.
On inflation, Mr. Dozie advised agencies to reduce operational costs as well as review renumeration structures with clients as marketing budget declines rapidly to cushion its impact on their businesses.
“As for inflation, I think agencies and people in marketing communications need to start to relook their cost structures especially when you have any cost within your business that is rising ahead of inflation. all those things really have to be reconsidered. You also have to look at the investment portfolio that you have.
“The elephant in the room is declining in investments. Clients will reduce the amount of money that they will spend. The first thing I would say is that agencies must start to review their remuneration structures with clients. It is all well and good if the client is spending billions and you are charging a percentage on that but when those billions stop coming and you are now spending 100 million, you have to move from a structure where you can charge the client per head, put an overhead on that so that you can protect yourself from that shock that comes with a decline in investments”
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