Ugo Geri-Robert is the head, Kantar Millward Brown Nigeria. Millward Brown is one of the top marketing research consultancies in the world and a part of the Kantar Group and the WPP System. In this interview, she acknowledges that times are hard for companies but warns against certain actions including budget cutting for marketing research as this would amount to cutting the nose to spice the face. She looks at massive sacking in various companies and says that some of these actions are not mark of creativity to solutions. Excerpts
How would you describe the impact of the economic recession on your business and your clients?
We are in the recession. At the beginning of last year we were all thinking that it would just blow away but by all indications, we are experiencing it deeper than we thought. Many countries have also gone through economic recessions and many of those countries that survived, a lot of good came out of it. In a recession, what you usually see is that the home brands begin to get the opportunity they never had. This is because consumers are now looking at how to stretch the available funds and what is relegated first are the premium brands. In the case of Nigeria, many premium brands are imported products. It is true that Nigerians like imported brands but when the money is not there, and you need to survive, then the consumer would do the needful. This means down-trading. In Nigeria, there are cases of down-trading to discount brands/local brands from cosmetics to clothes and shoes. Some local brands are already picking up.
How would say the economic hardship has also affected the multinationals in Nigeria
When our clients sell, we also sell. When our clients are doing well, it means that they should have available funds for ideation works. But when there is no money to invest in outside the box thinking, the client would put all their concentration and their efforts on just selling, making sure the production is going on. In 2016, our clients were hit due to the short supply of the foreign currency for raw materials and equipment. When our clients are not doing business, research and other marketing communication budgets are usually the first to be cut. For many of our clients, either the budget for research was cut to 50 percent or for some of them there was not research at all.
Companies need research to move forward and now they are abandoning the exercise due to recession, where does this lead the companies?
We have reiterated it that our mission in Nigeria, as Kantar Millward Brown is not just to struggle for existing business, but we want to grow the marketing research business which is still a gray area. In Nigeria it’s just the multinationals who are investing in it, however the mid level companies are just coming up. They still do not have the full grasp of the impact of marketing research in their business. This is because they are still looking at research as a commodity but not at big picture for long term. When some face economic difficulty, they quickly turn to expenditure to see where they could cut. We are still preaching to organizations that it is in time of recession that they need marketing research because in every disadvantage there is a silver lining. As companies are pressed, this is the time for creativity. Recession is not all bad, it is a time to sit back and see where the opportunities are.
Why is the marketing research budget usually the first target for cutting during hard times?
It is the board who does not usually understand the import of those areas on business. In time of economic recession, every board is looking at profit and anything that seems to be eating the profit is usually axed.
In recession, companies who still want to test the market provide little funds for research activity, how do you cope with it?
Every year, we try to find out from our major clients the budget they have for the year for marketing research and the projects they want to embark on. If there is the case of little or limited budget, we would first understand where the company wants to go in the year and understand the goals, target and opportunities the client wants to pursue, and based on that we would offer our advice. So it is not just the money for us but a desire to make our clients business grow because when they grow we also do well and grow along side.
In this period, what do clients want to find out through marketing research?
Recession comes with some change in consumer behavior. Right now, clients want to feel the pulse of the consumer, they want to know the impact of recession on their consumers and what has it caused them to do, that they were not doing before. This is because the clients want to understand how it has impacted where the companies play. During recession is the time to find the white spaces and what more can a client do. It is not all about increasing or decreasing the price or reducing the quantity. It is about what more can a client do and what more can it offer. This is a moment of innovation and a moment the home grown brands are doing a little bit better. Recession is a moment of discoveries even at homes in our various families.
In a moment of discoveries, Kantar Millward Brown as a marketing research consultancy is pivotal, how would you say you have been playing that role
We don’t see ourselves as research agency but as partners to our clients. What we discuss is how to add value to our clients because when they sell, we sell. Right at the onset of the recession, we knew that clients would need to understand the consumer changing behavior. Therefore, it was not enough to sit down and wait for the client to call us for a brief, but we took it as a challenge to understand the impact of recession as it pertains to our clients. So, upfront, we could actually help them in directing their path and remaining profitable. Time of recession is also a time of exams conducted and marked by consumers. At the end of recession, some clients would have made enemies and some would make friends. So we position ourselves to help our clients remain as friends.
Nigeria is a big market and in spite of recession, foreign firms are still coming and as they come what is uppermost in their minds?
Nigerians are a peculiar people and the foreign firms have all along known about the Nigerian market. Nigerians are resilient people and they are determined in spite of the recession. Foreign firms who are coming in know that the recession is temporary and they are positioning themselves now.
Could you talk about your recent research which found that child pester power and TV watch rate are declining?
Recession is also survival time. Again, end of recession is in sight but companies need to be alive to see the end of recession. During recession, the focus is survival for every company and individual. During this time, families for instance begin to think more volume than value. Before now, children had the pester power but now, pester power is still there but the parents are not acting it out because of the lean purse and times
How does this affect marketing research by firms?
Firms are concerned with letting the consumers know that they understand how they feel and that they genuinely feel for them but both the consumers and the companies are in it together. For those that don’t want their quality to be touched, they allow consumers to pay a little more but for those that are looking for the volume, that is where the thinking is coming in. They now play in re-packaging with cheaper packages. For those who are sacking, I must say that there is no creativity in sacking workforce. That is the easiest way out in a turbulent time and the companies call it the last resort. But I tell you that because the times are difficult, if we are thinking more as a team, we could actually give a time in trying to find a way out before we get to the ultimate point of retrenching. My advice to companies is to seek investment in creativity, in discovery and trying to harness the opportunity in recession first as there is no opportunity in sacking. Once a company downsizes, it continues like that without any changes and sometimes it could be status quo. But if the company hangs on and call the team and tell them that this is the time to think outside the box, and create teams and give them tasks of thinking, this is more engaging, more vibrant. Sacking is a lazy approach to managing situations.