Havas ceo calls for agency changes

25 January 2011

PARIS: Traditional ad agencies are falling behind tech giants such as Google and Facebook in providing certain marketing services, Havas ceo Fernando Rodés Vilà has warned.

In an interview with the Wall Street Journal, the executive said tech firms offering services such as online data tracking "don't call themselves ad agencies but they build brands".

"Clients are demanding things that we are not yet able to do, things others are doing," he added.

"We were so successful in the '60s, '70s and '80s that when the internet came, we didn't react. We were very slow in embracing that new technology. We allowed all other elements in the chain to embrace it for us."

According to figures cited by the Havas ceo, around 20% of the holding company's 2010 revenues were derived from digital, up from 9% in 2006.

Generally, digital media spend is almost certain to grow in future, and Rodés Vilà said that some larger clients should be spending more than 50% of their marketing budgets on digital.

Rodés Vilà also recommended that agencies build "social capital" around brands by engaging in dialogue with consumers, rather than following the traditional top-down mass communication model.

Addressing last year's WFA Global Advertiser conference, Rodés Vilà said brands should reflect "sustainability", and show themselves as producing "meaningful" goods in order to gain social capital.

A global Havas study conducted in 2009 showed that topics indirectly or directly related to sustainability - such as pollution, crime and inequality - came second, third, fourth and fifth on the list of things people were "very concerned" about.

According to Havas' latest financial results, the holding company's revenue returned to growth early last year, and rose by almost 7% year on year over January-September 2010.

Revenues reached €1.1bn ($1.5bn, £940m) for the nine-month period.

Data sourced from Wall Street Journal/Havas/Warc; additional content by Warc staff