What does the Trans-Pacific Partnership mean for the Malaysian ad industry?

As strategists we are taught to live life with both the glass half full and half empty in order to see the world in bright lights and in darkness.

With the issues surrounding TPP (Trans-Pacific Partnership), my views straddled more towards the half empty glass, but I decided to take my personal concerns out of the equation and view it through my professional lens, to see if any goodness exist within it.

To set some expectations, we’ve primarily been shown in the media the disadvantages and the pressure of TPP especially around open competition.

Before we jump into the nitty-gritty,  it is worthwhile to take a minute and break down this agreement to its simplest form and understand what this whole damn thing is about. Why is this agreement being placed under such a heavy spotlight?

This trade agreement with its twelve key country members, (US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru) will gained access to a combined population of 809 million with a market size US$ 2.7 trillion which accounts for 40% of the global GDP. In essence, this enhances the shared benefits of trade by eliminating barriers to expanded international commerce thus further strengthen a country’s economic growth especially those who are still developing.

On the other side, there’s been significant pushback from the public with criticism around governments not developing local enterprises but giving precedence to foreign companies instead. This agreement will allow foreign corporations the power to sue the governments over policies that impact their bottom-line, which leave some to believe this will open the country up to foreign colonisation.

So how is this trade agreement different from others Malaysia has participated in?

This agreement puts a larger emphasis on transparency. Now without having to veer too far off track, Malaysia on a governmental level is not known for their ‘openness,' which means there’s an opportunity to make Malaysia’s current administration much more accountable than previously.

The other thing worth mentioning is that this agreement will put Malaysia in a very uncomfortable position in terms of having to future proof itself. The Malaysian mindset especially among enterprises, bar some of the more forward thinking but, for the majority has always been of ‘comfort’, doing enough to get-by, where’s innovating is seen as wasting resources and time.

As a strategist, I naturally look for growth opportunities, identifying market and consumer opportunities for my clients. The TPP agreement gives Malaysian brands (corporate and SMEs) permission to evolve to embrace competition, and to think outside the ‘four walls’ of Malaysia, where a slice of a lucrative customer base is up for grabs.

Critics of TPP say this agreement will only benefit those with bigger and deeper pockets, yes this opens them up to larger revenue pipelines, but it also gives similar opportunities to the smaller players. Those with growth ambitions and who want to stay competitive, this agreement, will be beneficial regardless of one’s Business size to be TPP ready, essentially placing all businesses on a level playing field.

Also, let’s not forget we live in a heavily digitalised world right now. Under the e-commerce chapter, businesses who are purely online-based can also operate in all partnered countries without the need to have localised servers or a brick and mortar location.

Before we go and pick up the phone and share the good news with our clients, the reality is our clients must be market ready.

Here’s an example of an international company being market ready: Japanese global logistics company called Nippon Express is looking to expand their services into Malaysia. They are currently in the process of improving their halal credentials to be market ready when TPP kicks off so they can export food related products from Japan into Malaysia.

Here’s an example of a local brand with an emerging global presence: F&B franchise, PapaRich recently expanded its brand into the US market with its first outlet in Los Angeles and second in New York City. Now granite, you might say PapaRich had time and the resources to get to where they are today, but with the TPP agreement a Malaysian brand with big ambition has the same opportunity to play on a similar level, no longer confining themselves to the four walls of Malaysia.

In essence, what I’ve gathered so far, the TPP agreement holds no biases. It gives opportunities to large, medium and small enterprises to think about the next phase of their business growth whether it’s through traditional or digital platforms

So how can an agency take advantage of this?

To get the ball rolling a shift will need to happen within agencies first, a shift away from just ‘execution’ and back towards a business advisor role and partnership with our clients. We need to change the current conversation that we’re having with our clients and lead them by example.

It is only then that we can we work together as partners to prepare for the new wave of competition and opportunity TPP will bring in 2017. So consider this: TPP will allow agencies to play a far greater economic role than ever before, a responsibility in which many agencies may find quite daunting.

But take for instance the statement Datuk Azih Muda of CUEPACS (The Congress of Unions Employees in the Public and Civil Services) recently made regarding the main economic driver in Malaysia:

“Malaysia is a capitalist economy which depends on oil and gas”.

So here’s a thought, although it may seem like a far-reaching goal, with TPP there’s opportunity to create new economic drivers with our clients, taking pressure off Malaysia’s dependence on oil and gas. Now wouldn’t that be something?

In conclusion, hopefully the Trans-Pacific Partnership agreement will give those in the industry a sense of renewal and optimism, for me, I am looking forward to be that trusted advisor to the brands I work with and prepare them for a whole new type of competition.

The plus side, for those working in the industry we have twelve months to get our stuff together.

The writer is John Lai, strategist at TBWA Malaysia.

(Photo courtesy: Shutterstock)