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Deloitte Digital’s regional launch: What does this mean for the industry?

Deloitte Digital, offering end-to-end digital services from strategy to delivery has launched in Southeast Asia, at a time competitors are ramping up operations in the region as well.

Led by Jonathan Rees, executive director and leader of Deloitte Digital in Southeast Asia, it works with clients across multiple sectors such as banking, finance, telco and government.

“Digital is part of an evolutionary journey and only one disruptor in a sea of disruptors,” he said.

“The business landscape is more complex and businesses must face a tension between the realities of operating a business and responding to disruptive forces.”

It offers strategy, mobile, social, web, cloud and digital content management solutions to brands.

The move comes at a time with the likes of Accenture Interactive, McKinsey Digital and other direct competitors upping the ante.

Most recently, Accenture acquired Australian digital agency Reactive Media. Having newly launched its digital marketing services, consultancy Accenture has already executed several digital projects for brands.

For example, it partnered with Philips to create the proof of concept for delivering vital patient data via Google Glass, potentially providing physicians with hands-free access to critical clinical information. It also built a digital social platform for Unilever’s global marketing to connect its marketers, brand managers and partners in 190 countries in 12 weeks.

McKinsey also recently acquired Lunar, a design firm that has been in operation for more than 30 years. It’s McKinsey’s first acquisition of a design firm. McKinsey Digital is now eyeing Asia Pacific as one of its next growth areas.

The promises all three giants of the professional services firms are making look similar. While time will tell what the real differentiator is, Frank Farrall, lead partner of Deloitte Digital in APAC, believes the strength for Deloitte Digital lies in its complete integration of “left and right brain offerings”.

The company recently hired a team of designers to offer clients the complete suite of services. “We have the ability to offer the full spectrum of services as opposed to our competitors,” he told Marketing.

A red flag for agencies?

Meanwhile, this move also implies even tougher competition for marketing and advertising agencies in the market offering digital services.

In a previous interview on the impact of such developments on agencies, Darren Woolley, managing director and founder of TrinityP3, said: “It’s interesting to watch how media agencies will often have data analytics offered as an additional service to their core offering. Analysts and data management capabilities are what the media agencies are only just beginning to build.

“The agencies need to become more results-focused and less cost-focused.”

According to Richard Bleasdale, regional managing partner at The Observatory Asia Pacific, the marketing agency industry has been trying to move “up the food chain” to regain the business-focused strategic role at the top table that it used to enjoy, but hasn’t for a long time.

This has had limited success, largely because most fail to have the depth of understanding of a marketer’s business that is required, and “focus on being ‘creative providers’ with work being bought by the metre, rather than having deep insight into a marketer’s challenges”, he said.

Why Southeast Asia?

Countries in Southeast Asia are in a different playing field – the digital capabilities and know-how are ripe and ready to be harnessed – and they need not and/or cannot follow in the digital footsteps of the mature markets.

A recent Deloitte paper states that smartphone penetration in Southeast Asia is expected to grow at a CAGR of more than 20% to reach an overall 38% of mobile subscriptions, a projection that translates into about 200 million smartphones.

“With this changing reality, companies in the region are faced with a rapidly evolving consumer profile, and are in danger of lagging behind in their consumer engagement efforts,” Rees said.

Digital is the CEO’s next battleground.

“It is the speed and thoughtfulness with which businesses respond in the digital age that determines their future.

“Whether companies prosper in Southeast Asia over the coming decade will depend on their CEO’s willingness to embrace digital. As the engine room for growth in emerging markets, responsibility for digital cannot be delegated. It must start at the top.”

Deloitte Digital is also confident of Singapore, given the launch of initiatives such as Singapore’s IDA Smart Nation and the recent boom in local technology start-ups.

In particular, for countries such as Singapore, Indonesia, Malaysia and Thailand, it believes there is an impetus for industries such as financial services, technology, media and telecommunications and the public sector to embrace digital.

“The converging of trends such as analytics, mobile, collaborative consumption, social and wearables in a hyper-connected world is creating endless possibilities. And that’s not talking about the emerging trends,” Rees said.

“Already, our clients are finding that while the cost base can be compressed, customer expectations are skyrocketing. Only by embracing digital can they compete and win.”

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