‘Media agencies need to open up their businesses to accommodate other investors’

Steve Babaeko, the CEO of X3M Ideas who works for Etisalat, Diamond Bank among other clients does not believe in luck but hard work. This is secret of his forte in the creative industry in addition to his workforce and discipline. Most of his works have inspirational, powerful and meaningful messages delivered in ways that touch their audiences. Steve who spoke to BusinessDay recently on a number of advertising issues said starting a business is not as important as sustaining it. Excerpts

Would you say creative agencies are feeling the fall in oil price and how does a revolutionary agency obviate the effects

Yes, we are feeling the effect. If your client is feeling the pinch, automatically you are also feeling it. It is not a situation that will be there forever; this is the time to rally round our clients to see how we can be more creative and future in our thinking to help us ameliorate the challenges. As an agency, to get out of the situation is to be more creative. At this period, clients are giving you more challenges with fewer budgets. This is the time to differentiate agencies who know their onions from those who want to make money.

How would you describe the relationship between politics and advertising?

Advertising operates within a polity. Also political system is intertwined with economic policy. If a party comes in to power, it comes with a plan for the economy and how they want to push the plan forward. If the political party is conservative, it will affect the macro economy and if they are adventurous and much future forward in their thinking, it will also open the economy. Therefore anybody that operates within such economy, the business will be affected by the government policies.

Did you work for any political party during and after the elections?

We did not have the opportunity. We are like surgeons, we are marketing experts. If there are marketing challenge and you come to us, we can proffer marketing solution. I have nothing against the agencies working for political parties.

How would you assess the jobs of the agencies that worked in the last election?

It is a difficult position to assess the jobs of your colleagues but what I see as general trend that looks like most of the communication were created by brief case agencies or one man outfit. They were not too professional.  This showed in total package of the jobs. There was a difference in some instances where professional agencies worked on some campaigns.  Going forward, it is important that political parties talk to professional outfits to work on their campaigns.

Most agencies hide their identity when working for politicians, why?

There are so many things we do as Nigerians and we do them because some of them are belligerent to our social cultural values as a people. For instance you don’t reply an elderly man and if you must do it, it should not be in public. The way politics works in Nigeria is still winner takes all.  Once there is a level playing field and when you are in opposition it does not matter and there will not be repercussion and blow-back for supporting somebody that lost election, then people will be able to identify with their works. In advanced countries, nobody will threaten to shut down your business because you worked for opposition. In our case, we need to sanitize our socio-cultural system to allow those who believe in the ideals of any party to be free from any harassment.

Are you worried that most agencies in Nigeria are one-man business, what does this portent for the future of the industry?

There is a saying that nature abhors vacuum. There is no vacuum in nature. Remember that a time all Zambian national team players died in an air crash but today there is still Zambian national team. A new crop of people will emerge and take the business forward from where we stopped. Even by the definition of one man agency, it does not matter to the structure most agencies have in place. For instance, the guys who are supposedly the leading lights in those agencies sometimes embark on trips and the business goes on. If the business can run when you travel, it can also run any time. My ambition is that when I am 50, I will vacate the seat and let somebody else run the agency.  Who thought that a bank MD would be told to vacate his/her seat after 10 years? Before it gets to that stage when such regulation will come into advertising the operators need to start regulating themselves.

Without an academy and other learning institutions for talent build up, what would you say is driving the industry?

The passion of key individuals and institutions within the business are still driving new talents. Until a few years ago when some us brought panache to it, there were not so many young people who preferred to work in the advertising industry. But now there is passion for advertising. This is due to a few individuals who are passionate and spreading the gospel about creativity and brands. Can we do better than we are presently doing, I will say yes.

Affiliation seems to be waning while equity partnership appears to be in vogue. What is the future of equity partnership in Nigeria?

The APCON law says foreign agency would own not more than 25 percent equity in local firm. As long as you a member of Association of Advertising Agencies of Nigeria, AAAN and by implication you are registered by APCON and licensed to practice, you must adhere to that law. May be by tomorrow it can be increased but when we get there we will cross the bridge.

Would you let go 25 percent equity in X3M

If you had asked me this question last year I would have probably said no, but with unfolding realities I may consider it. It may not be dependent on money, equity participation; I also want to see the value the partner is bringing to the table is valuable. This is like a marriage. You cannot see a beautiful woman and marry her but it is about the value system, the culture.

Are you worried that all the media agencies are not listed on Stock exchange

I can throw that question back to the media houses. How many publishing houses have built a structure to outlive them? In the private sector today, this is one challenge we all still struggling with. Most agencies in their heart want the businesses to live for generations. I believe time has come for us to take active steps to open up our business.

If you can’t go to stock exchange, we can do private equity placement, open it and let more people participate. The owner will be richer for it because corporate governance will become more enforced and the management will be accountable to some people. I am sure we will get to that point and it is not far away. In Nairobi, an agency is quoted on the stock exchange. We have plans and I don’t mind to be the first agency to be quoted.

Today, 3XM creative works are attracting attention, how do you feel

This is why we started the business in the first place; to create innovative works. When a creative entrepreneur sees his works helping the brand to grow and growing awareness and growing all the key brands’ health indicators no amount of money will pay for the joy.