Primož Pusar: The Future Is in Digital Marketing

Following the departure of Pristop’s founder Franci Zavrl, Primož Pusar took over this consulting and communications company.

Although he considers himself more a financier than an adman, he has been part of the advertising business for a number of years. He has worked on the development of the company’s strategic business cooperation, producing positive results even during the crisis.

You are the largest consulting and communications company in Slovenia. How are you coping with the gravest crisis to date?
Through all this time, Pristop has managed to sustain growth in its business activity, both in terms of the amount of revenue and profit, which will reach the 2008 level this year.
Marketing communications have been hit hard by the crisis, even more so in Slovenia. The main reason is the effect of the economic crisis on the companies’ business activity and amount of trade. The liquidity crisis is an additional problem in Slovenia as companies have been forced to cut down on their operating expenses. For most companies, these expenses mainly consist of advertising. This has brought about harsh conditions on the agency market.

As early as in 2006, Pristop started focusing heavily on the development of strategic business consultancy, thus adding a new dimension of integrated knowledge to the company’s development in the areas of marketing, corporate and digital communications management. We assumed that companies would need expert external assistance with a client that is good at their business and good at marketing but is not proficient in big data and the transition from business aims through marketing and communications aims to the final execution. We determined that efficiency must be the key to success in our line of business. In six years, being so far ahead of the competition, we have managed to build a team of employees with a wide range of knowledge and skills. We sign contracts with clients, focusing mainly on business aims, which is of key importance in these times. Using our approach, we thus reduce transaction costs, enable risk sharing and, finally, result sharing.

How is the payment practice?
Poor. Liquidity is currently the greatest problem in doing business in Slovenia. For instance, our Serbian branch has only two clients that are more than 60 days behind in their payments. This situation is comparable to that of my Swiss colleagues. In Slovenia, the average client settles their liabilities in 100 to 170 days.

Last year, you entered into a strategic partnership with the Swiss corporation Goldbach Group and established the joint regional company Goldbach Adriatic. How did this connection come about?
Goldbach had decided to establish their presence on three markets. The German-speaking area (Switzerland, Austria, Germany), Central and Eastern Europe (Romania, Bulgaria, Poland, the Czech Republic, Slovakia, Ukraine, Russia) and the Adriatic region. In the case of the latter, they decided to form a partnership with the Pristop Group that is already present in the territory of the former Yugoslavia. This resulted in the biggest digital marketing operation in the region.

Are the first results of the partnership already visible? Your plans were quite ambitious. How are they coming along? You mentioned explosive growth.
The first results of this cooperation are excellent. Goldbach Adriatic has recorded a 60-percent growth in revenue this year and the total revenue will amount to around eight million euros at the end of the year, as predicted.

You are establishing a regional digital services centre in Serbia. Can you tell us a bit more about this project?
This is going to be a centre for the entire Goldbach Group. The Group has heaps of development projects that are extremely expensive in terms of the Swiss salary level. It is therefore difficult for Goldbach to afford to run several projects at the same time and development is one of the key factors in staying ahead in digital marketing. Furthermore, the majority of global players in production, i.e. design, programming and development, are moving to countries where the ratio between the qualified workforce and labour costs is more favourable than on the markets where we operate. The goal is to create the leading digital marketing agency on the Serbian market that will also offer its development services to the entire Goldbach Group, as well as perform certain business operations for individual companies, particularly Goldbach companies in Switzerland, Austria and Germany.

How many people from Slovenia will take part in setting up the regional centre?
Slovenians will assume the leading role in Serbia. I run Goldbach Adriatic so I have chosen co-workers that I trust. The chief engineer, the COO and all the major developers will be Slovenians. At the beginning, we will have around 25 employees and by 2017, we are planning to employ around 60 people. Around 25 percent of employees in Belgrade will be Slovenians.

What does this mean for the Slovenian advertising market? Why Serbia?
It would not make sense to do this in Slovenia for two reasons. We have trouble finding suitably educated and experienced people with our existing scope of business. Luckily, we Slovenians also have a number of successful start-ups that have picked up quite a few experienced people in this field. We believe that the Slovenian market has exhausted these profiles and this is why we have chosen the Serbian market. The Slovenian advertising market will not be affected as a result.

What are your predictions for the future of digital and mobile marketing in the region?
This forecast is rather easy for us to make since it is based on similar patterns in developed markets. Scandinavia, Great Britain and the USA lead the way, followed by the German-speaking area in two to three years, Slovenia soon after, Croatia in one year, Serbia in a few years etc. Mobile and digital marketing represent 30 to 50 percent of the entire advertising pie in the developed markets. In Slovenia, it is well below 10 percent, while it represents four percent in Croatia and a good two percent in Serbia. These forecasts were taken into account in our plans, which show that the markets in the region will continue to have impressive growth rates for at least four years.

Why has the share of digital and mobile marketing in Slovenia come to a standstill?
For two reasons. The first reason is connected to the dire economic situation, as a result of which companies resort to time-tested recipes and do not take risks with new approaches. This is clearly reflected in the results of television advertising. The second reason is a lack of knowledge. Most Slovenian advertisers and advertising agencies have significantly more knowledge of classic media. Accordingly, digital media are being neglected or continue to play merely a supporting role.

The reasons for the recent departure of Pristop’s founder Franci Zanrl reported in the media were rather scant. Why?
It is a long-term affair that progresses over time. The fact is that things coincided rather unfortunately. The process of ownership restructuring and the transfer of active management to the younger generation at Pristop began in 2008. As part of this process, Dejan Verčič, PhD, was the first natural person to leave, followed by Andrej Drapal. Zavrl’s departure is thus part of the company’s strategy. However, he is still connected with the company through ownership. There is no big story.

What did last year’s criminal investigation at Pristop’s headquarters reveal? The subject of the investigation was said to have been alleged irregularities in relation to the implementation of the Law on Development Support to the Pomurje Region.
As far as I am aware, none of Pristop’s employees are suspected of or charged with anything. If they were, the company would consider whether the accused could still be part of Pristop. Pristop itself was never under investigation, as was reported by some of the media.

Author: David Kos