Arc Worldwide connects with Asia Pacific for ‘practical magic’

When you go to the supermarket to buy a bag of chips, do you have a preconceived idea of what kind of chips you will be buying? When you get to the aisle of snack goods, you are bombarded with more than a handful kinds and brands of chips to choose from, not to mention flavor varieties and pack sizes, as well as promotions that could affect your final choice. What to choose? Natural, barbecue, sour cream, cheesy or spicy hot? Corn chips, potato crisps or corn snack? Snack size or value pack? Buy-one, take-one, with a dip add-on, or a collectible figure? And don’t forget the price. Will a pack that costs less than P10 be just as good as a P25 or an P80 pack?

These are the factors that affect consumers daily around the world. While the act of purchasing any good often requires advance planning or brand loyalty, the actual decision to buy is made in-store.

Details like these fuel a new field of marketing that is slowly making an in-road in Asia. Called shopper marketing, it has been defined to mean "the art and science of leveraging retail opportunities to convert shoppers into profitable brand buyers." Simply put, it studies how and why people buy.

Arc Worldwide, the marketing services company aligned with the creative powerhouse Leo Burnett Worldwide, is using this new field of marketing in realizing its vision of offering its clients "practical magic," a catchphrase to describe innovative holistic solutions that will work to the advantage of business.

Arc Worldwide launched recently its Asia Pacific arm in Kuala Lumpur, completing the global Arc Worldwide network of world-class marketing services agencies.

Formed last year, Arc Worldwide united all Leo Burnett’s marketing disciplines to establish a new breed of marketing agency, delivering integrated marketing solutions that drive clients’ businesses.

The key disciplines within Arc Worldwide are direct marketing, interactive, promotions, shopper marketing, and public relations (Southeast Asia only).

Nick Brien, chief executive officer of Arc Worldwide, celebrated the launch of the Asia-Pacific network with over 150 regional and local clients, along with Arc and Leo Burnett discipline and regional heads from around the world.

During the launch, Brien said, "Today’s clients require a truly integrated approach to engaging customers that is focused on driving sales. Arc Worldwide is the only global network that can deliver this approach by creating truly inspired solutions across the complete range of marketing disciplines."

"The Arc business model is based on one clear and guiding principle – to deliver ‘practical magic’ – our expression for inspired marketing solutions created through the fusion of creativity and accountability. Our close partnership with Leo Burnett enables us to jointly create and deliver holistic marketing communications to our shared clients."

Speaking at the launch, Arc Worldwide Asia Pacific regional managing director Charles Cadell gave his perspective on the Asia Pacific environment, saying, "Sound economic growth, rising population and changing lifestyles have resulted in a new Asian marketplace that is dynamic and diverse. Therefore, it is critical that we harness this trend by providing flexible, innovative and integrated marketing approaches that adapt seamlessly to local needs."

"By recognizing niche markets that are carved by emerging consumer trends, we believe that with Arc’s five key disciplines, we will be able to tailor-make marketing solutions to build meaningful connections between the brand, the channel and the consumer," adds Cadell.

Arc Worldwide’s logo is the arc, representing a continuum. Brien says the image of the arc reflects the firm’s "connectivity."

Speaking on Arc Worldwide’s shopper marketing discipline, the new approach that is being introduced in the region, Cadell says Arc will be able to help marketers turn shoppers into profitable brand buyers.

"Insights on consumer behavior tell us that on average 75 percent of consumers make their buying decisions in-store. Meanwhile, the average FMCG (fast moving consumer goods) will spend 65 percent of their marketing budget at trade level – the majority against trade discounting. Against the measures of advertising, direct marketing, interactive or public relations, there is very little understanding or measure of how effective this money is being utilized," he adds. "With shopper marketing, we bring the art and science of leveraging retail opportunities to convert shoppers into profitable brand buyers."

Arc Worldwide North America president and chief executive officer Dick Thomas explains that many of today’s consumers have closed minds because of information overload. The development of communication innovations such as TiVo and spam block indicates the desire of consumers to block off advertising-related material. While consumers have a 50 to 85 percent awareness of products, traditional advertising influences only five to 15 percent of their purchase decisions.

"As much as 60 to 90 percent of purchase decisions are made in the store," Thomas says. That’s why there is a need to harness these opportunities when a consumer goes to the store.

"Shopper marketing is based on a deep understanding of the shopper’s mindset and behavior," he adds.

Apart from shopper marketing, Arc Worldwide is maximizing the use of interactive marketing within the Asia Pacific region.

Arc Worldwide Southeast Asia head of interactive Mark Renshaw says marketers are finding a unique experience in Asia when it comes to interactive marketing. In countries like Japan and South Korea, where broadband Internet access is widely available, e-commerce is on an upwing. In the Philippines where there is a maximal mobile phone exposure, there is much movement when it comes to innovative marketing via cell phones.

"There is much more response to these things in Asia," Renshaw explains. "Consumers engage or interact positively to promotions or games online that many marketers have to find ways to make their innovations more compelling. Online marketing is attracting people. It is very acceptable to them. And in many instances, marketing does not just go online, but also through mobile phones."

E-commerce is now in its third or fourth generation since it was first introduced in 1995-1996. Since then, the level of security online has advanced to offer consumers secure transactions.

"And yet online sales in the United States is now just at five percent," Renshaw says. "Many American consumers use the Internet purely for information. They may study a product they are interested in buying online, but they still go to the retail store when they do decide to buy it."

He attributes acceptance of both e-commerce and m-commerce as a cultural thing.

"For many Americans, they still want to personally buy the product with cash. It’s a cultural thing to pay in person."

For Malaysia Airlines, Arc Worldwide created an integrated site that not only offers a booking engine and information on the carrier’s fleet, but as well as tourism-related material on Malaysia. The site offers browsers travel tips, information on Malaysia as a destination and important maps on key tourism destinations in the country.

A month after the site was launched on Aug. 17, 2004, the MAS site registered four million hits, a 15 percent increase from its previous monthly total. Likewise, online bookings rose by 268 percent.

Arc holds a roster of blue-chip clients for whom they produce business-building and award-winning work, including longtime clients General Motors, McDonald’s, Visa, Procter & Gamble, Kellogg’s and The Coca-Cola Company. With headquarters in Chicago, Arc Worldwide is a new marketing services agency delivering holistic solutions by using innovation to drive growth. It has more than 1,100 employees covering 42 offices in 36 countries.