Wed, 07 Oct 2020 10:57:50 GMT
Since establishing its first overseas branch in Malaysia in 1973, Hakuhodo’s international network has grown to encompass over 105 offices in 19 countries abroad. In this new interview series, leaders from various domains share their insights on how Hakuhodo is rising to meet new challenges, along with the strategies that will take Hakuhodo to the next level on the international stage.
Leading off the series is Nobuaki Kondo, president and CEO of Hakuhodo International, who is responsible for overseeing the entire overseas business.
Stepping up to meet new global standards
In step with an increasingly borderless age, the past two years have seen the expansion of Hakuhodo’s global network. These have included the acquisition of the Winter Egency in Thailand in November 2019 and AdGlobal360 in India in March 2020, as well as the opening of Hakuhodo Digital Vietnam in January 2020.
Kondo points out that the parameters for operating as a world-class agency network have changed over the past few decades. In the past, there was a strong perception that advertising was closely connected to a country’s language and culture. Prior to 1980, Hakuhodo did not place priority on overseas expansion, and the main function of its overseas offices was to support the international activities of Japanese clients.
“However, the situation is completely different now due to the rapid growth of the Asian market and the maturation of the domestic market. Hakuhodo has decided to focus on the overseas market for its management strategy. The acquisition of overseas agencies and alliances are part of this effort,” Kondo explains.
One country, one management
Reflecting contemporary thinking in the advertising industry, Hakuhodo is introducing a new system for its international offices. Kondo describes it as the “one country, one management” system. “Hakuhodo currently has multiple offices in one country and responds to each client’s needs. Going forward, we’ll also establish an organisation to oversee each area and manage resources, drawing on our collective strengths for speedy decision-making. Thus, the aim of the system is to improve our competitiveness and efficiency,” he says.
Hakuhodo International Thailand (HIT) was established in January 2020 as the first example of the “one country, one management” system in action. In bringing together 12 offices in Thailand, HIT has been able to acquire local clients, along with a strong foundation and experienced team members. New business inquiries can be handled through a single point of contact, while functions such as HR and accounting are also streamlined, leading to increased efficiency. Plans are underway to roll out this management style in other countries and regions in the future.
What are our strengths in the international market?
In terms of raising its global profile, one of Hakuhodo International’s key strengths is the depth of its knowledge about people and the amount of data that has been accumulated. Kondo says this has become a valuable asset not only in Japan, but overseas, too. No other company in the world is so invested in the collection and analysis of data about people, which connects to one of Hakuhodo’s core philosophies, Sei-katsu-sha Insight. Sei-katsu-sha means ‘living people,’ and the philosophy behind it views customers as true individuals with unique lives.
“We invariably get a positive response from decision makers at overseas clients when we talk about the philosophy of sei-katsu-sha and the concept of our Hakuhodo Institute of Life and Living, a think tank specialising in people,” Kondo notes. “We currently have Hakuhodo Institute of Life and Living locations in China (Shanghai) and Thailand (ASEAN), with plans to expand it to Taiwan, India, and other countries in the future. By continuing to invest in this field, I think we can differentiate ourselves from other global agencies, and provide more convincing solutions based on a deeper understanding of people.”
Kondo also touches on Hakuhodo’s ‘power to integrate.’ “Since this is so ingrained in the company’s domestic corporate culture, employees may not think of it as a strength, but it is one of our key assets as an integrated marketing solutions company.
While any company can claim to be a ‘one-stop agency,’ Kondo points out the importance of having realistic expectations about the extent to which you can truly meet the needs of the client. “Our strength lies in our ability to optimally integrate our internal resources with those of our external partners and to take responsibility for everything from planning to execution.”
“This will definitely be a strength overseas as well. However, it’s difficult to see this from the outside. I think we’ll need to come up with ways to help people overseas understand our capabilities, which are a matter of course in Japan: The power to design the market while planning how to connect with our sei-katsu-sha from all touchpoints, and the resulting high-quality services we can provide,” Kondo says.
Building an even stronger Hakuhodo network
Hakuhodo already has 11 digital agencies in Asia, and there are plans to increase this number in the near future. The Hakuhodo Digital Network was conceived in 2019 as the centre of this reform in this completely digitalised era.
Kondo points out that no matter how good an organisation may be, there is no growth potential when each office operates as a stand-alone, and thus Hakuhodo’s aim is to build a network for collaboration and sharing of knowledge. “Furthermore, if we accumulate survey data obtained through the digital agencies in each country, we can build a network with the strongest data on Asian people.”
Hakuhodo is not only expanding its global network through the digitalisation realm, but also through activation, empowered by the acquisition of Taiwanese advertising agency group Growww Media in April 2020. In terms of activation, Hakuhodo Products is already well respected for its capabilities in Asia, too. Going forward, Growww Media and Hakuhodo Products will combine their strengths with other leading players in the ASEAN region, such as Square Communications and PMG, enhancing business opportunities and producing results in each market within Asia.
While acknowledging Hakuhodo’s strengths in Asia, Kondo says it is essential to develop the North American and European markets, too. “In January 2019, we formed business partnerships with Unlimited Group in the UK and Serviceplan Group in Germany. Both companies have the same orientation as Hakuhodo in the areas of data marketing and activation, so we plan on raising our profile in the European market through collaboration with our alliance partners. With the help of Serviceplan Group, plans are also underway to establish Hakuhodo International Europe in Munich, Germany, to oversee the entire European region,” he says.
Working in partnership with clients
According to Kondo, Hakuhodo’s philosophy of ‘Partnership’ is an excellent strategy for expanding Hakuhodo’s global business. The company has built a strong reputation for utilizing a deep understanding of clients’ business to support Japanese companies in their international activities. Now it’s time to take this knowhow and experience as a business partner to the world stage.
“When a brand is standing in the international spotlight, Hakuhodo should be there to support it at the core. I think that’s the essence of a global agency—understanding the brand at the deepest level and supporting it in the optimal way when it is launched into the world,” Kondo says. “Our ‘Partnership’ philosophy has the potential to generate significant global business opportunities going forward.”