Riyad Shahir Ahmed Husain is the CEO of Dhaka-based digital marketing company Magnito Digital. Magnito is one of the earliest digital marketing companies in Dhaka and over the past few years, it has grown significantly. In its fifth year now, Mangino eyes further. “Now that we are completing our five years, we think that we have come to a crossroad and that this is the end of phase one,” says Mr. Husain. “The next few years are also very important for us. Now we are investing in a couple of areas which we think is critical for our growth and scale going forward.”
In this immensely insightful interview, Mr. Husain tells us about the current state of Magnito Digital and its ambition, how much it has evolved over the past few years, its growth strategy going forward, talks about changing digital marketing landscape, his take on growing competition and challenges in digital marketing and major digital marketing trends going forward, shares his management philosophy and incredible importance of having good partners, shares his ideas for being an effective CEO, building a sustainable business and dealing with stress and challenges as an entrepreneur.
Future Startup
Please give us an overview of Magnito Digital such as how big is your operation now, services, team, and business etc.
Riyad Shahir Ahmed Husain
This is our fifth year running at Magnito Digital. We will be celebrating our fifth anniversary early next year which we feel is somewhat of an achievement given that it is quite difficult for early-stage companies to survive the first few years.
When we started Magnito, it was a journey into uncertainty. Digital marketing was just getting started and we were among the few earliest companies.
In early 2013 when we first entered into the market, the first challenge was getting into the market, convincing and onboarding clients with what we were offering and then ensuring that we deliver value to our clients.
The other challenge, which is common for an early stage company, was to make sure that we sustain.
Over the last five years, we believe we have been able to do both: deliver value to our clients which helped us to sustain and thrive in the market. We now have a strong ground under our feet. We could have done better but we are content with what we have done so far.
Currently, we are a team of 72 people and growing.
We work with a diverse portfolio of clients starting from large multinationals such as Telenor Digital, Grameenphone, Huawei Mobile to local conglomerates such as PRAN-RFL Group, Meghna Group as well as some projects of the Bangladesh Government.
What we are really proud of is that over the past few years, we have built a generation of digital marketers in Bangladesh. Although, we are currently a team of 72 people, over the past five years at least 200 people worked with us in various capacities. These people are all now contributing to the industry.
We broadly define ourselves as a partner who helps you to manage your digital assets by building digital contents and experiences. Our offering includes a range of services such as social media management, digital content development, digital platform management, media buying, data analysis etc.
Over the last two-three years, we have also developed capabilities around managing digital products. We manage content for some of the largest apps of the country such as WowBox, GP Music, and Bioscope. We have in many ways become the go-to agency for managing digital products in Bangladesh.
In the future, an increasing number of brands will bring new digital products and platforms and they will need services around managing these products. We are thus positioning ourselves as an agency that understands how to manage digital products, understands metrics and help grow your digital products.
With 10 million downloads of WowBox only in Bangladesh, we have been able to build and prove our capability in managing and scaling digital products.
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In early 2013 when we first entered into the market, the first challenge was getting into the market, convincing and onboarding clients with what we were offering and then ensuring that we deliver value to our clients. The other challenge, which is common for an early stage company, was to make sure that we sustain. Over the last five years, we believe we have been able to do both: deliver value to our clients which has helped us to sustain and thrive in the market.
Future Startup
How much has Magnito Digital evolved over the past few years?
Riyad Shahir Ahmed Husain
When you survive for five years as a company, you naturally evolve organizationally. For instance, since we have grown as a team we needed to build our HR structure, put together other pertinent systems and pay greater attention to building a company culture which we have done.
The most important development, however, is that we have developed a deeper understanding of the market and the digital ecosystem in the country. We now better understand the users. We now understand how people react to content and types of content people consume and other nuances of digital marketing.
We have also been able to develop capabilities to deliver better results to our clients. Today, we have a great team. We have built an institutional structure that fits with the demand of the market and enables us to deliver best possible solutions to our clients.
In 2013, our operation was leaner than now. One team member used to perform multiple responsibilities and team collaboration was more close-knit. The good side was that things were more integrated and it was easier to collaborate. But it was also a stretch for people. Consequently, our results suffered in many instances.
When we started to grow, over the years we have built specialized departments and teams. That is one of the major changes that happened. Today, we have separate departments and teams for design, client service, copywriting, content, video production, animation and other functions.
The challenge that comes with growth is the management. You need managers for each of these departments and things get slower. The good side is that you can deliver better result because people get specialized in different areas.
We now have senior and more capable people in the team that we could not afford a few years ago. For instance, our Creative Director Kaushik De is an advertising industry veteran. An Indian by origin, he has decades of experience of working with major advertising agencies both locally and globally. Since he joined us, we have grown manifold.
Growth-wise, over the past few years, we have grown by over 50% year on year!
For any business, building and maintaining relationships is the key thing. It helps you to grow. Now, these relationships are not only with clients or potential clients, but it can also be your relationship with your team, with your vendors and stakeholders who are relevant to your business.
Future Startup
How have you grown Magnito Digital? What has helped you to grow your business?
Riyad Shahir Ahmed Husain
For any business, building and maintaining relationships is the key thing. It helps you to grow. Now, these relationships are not only with clients or potential clients, but it can also be your relationship with your team, with your vendors and stakeholders who are relevant to your business.
Having said that, building and maintaining good relationships require many things. It is not only about saying positive things, you have to act on it and do things to build lasting relationships. We have worked hard throughout our journey to make sure that we build and maintain a positive reputation among our stakeholders.
It is extremely important to be humble. Today, I see many young people with a lot of arrogance, which is detrimental to your growth as a business leader. You can’t thrive in the long run if you are arrogant. You have to be humble if you want to grow. You have to stay grounded on your feet to grow. I think these things ultimately translate into good relationships which I believe helped us to grow Magnito. Our culture is like this. These are the values we maintain within the organization and outside.
The other thing that has contributed to our growth is our relentless push towards the future. We have always tried to evolve and stay ahead of time. We have tried to understand what is going to be the next big thing and develop our capabilities around that and deliver that to our customers before everyone else.
Over the years we have seen that your ability to see and understand the current and future trends is critical in digital. When you can see things ahead of time it gets easier to develop your capabilities and serve your customers better. This forward-thinking approach has helped us to grow the business over the past few years.
Future Startup
When you started in 2013, digital marketing was a relatively small industry. The size of the market was not big. The competition was also not that fierce. Over the past few years, digital has grown significantly. Brands are now spending more on digital marketing than before. At the same time, competition has also grown. Once incumbent advertising agencies did not have any digital operation and many of them are now have strong digital wings. What do you think about the competition in the space?
Riyad Shahir Ahmed Husain
When we started in 2013, the number of companies offering digital marketing services was slim. But after a year, in 2014, the number of companies offering digital marketing services started to grow rapidly.
In the following two years, digital marketing companies sprung up here and there like mushrooms.
The entry barrier to digital is quite low. If you have a small team and some basic skills, you can start offering services.
Having said that, this is not an easy business - low entry barrier does not mean that it is easy to build a sustainable business in this field.
We are in service business which means you have to consistently provide best possible services to your customers. The day you fail to provide it, your client will go somewhere else. Even if you are doing everything right, in our line of business it is not that easy to manage the cash flow due to delays in payment schedules. Overall, while it is relatively easy to start a digital marketing company, it is a tough job to sustain and scale up.
Consequently, in 2016 many digital agencies that started in 2014 and 2015 went out of business. Before 2016, in the first three years, we had to compete a lot. Price competition was a thing. After that, competition in the market has gradually gone down.
In 2016, we decided to apply some strategy around building credibility in the market. In order to build a solid business, you need to have proven track record. What you claim does not matter if you can’t show relevant work. So at that time, we had decided to focus more on doing solid work. In fact, by that time we had been able to build a good portfolio of case studies.
Today, we have case studies of successfully managing reputed brands and products. Now our works speak for itself. At the end of the day, it is all about work.
We don’t get into the price war anymore. Our clients are aware of the standard of our work and they are prepared to pay the premium.
This is a fast-moving industry. Things are changing every day. In order to stay relevant, you have to always stay ahead of the game. If we keep doing the same thing and fail to evolve, we will become irrelevant soon. That is the challenge.
Future Startup
What are the challenges for Magnito Digital now? And what are the challenges for the overall industry?
Riyad Shahir Ahmed Husain
There are some challenges at the policy level. As an agency, we are not that much into media buying. We mostly do strategy and content creation. However, major spending in this domain actually comes from media buying but unfortunately, policies are unfavorable around digital media buying.
For instance, a significant percentage of digital buying budget goes to Google and Facebook but most of it goes through the grey channel. The consequence is that these companies will not be interested to set up direct offices in Bangladesh and if they don’t come to Bangladesh, our ecosystem will not grow.
If you try to remit digital media buying payments officially through the Central Bank, it gets very expensive as there is a high percentage of surcharge on it, which not many companies are willing to pay. These are the policy level challenges. If the Government can review these areas, the industry will grow faster.
As for Magnito Digital, the challenge is always identifying the next big thing, next major trend and deliver to our clients accordingly.
This is a fast-moving industry. Things are changing every day. In order to stay relevant, you have to always stay ahead of the game. If we keep doing the same thing and fail to evolve, we will become irrelevant soon. That is the challenge.
The most important development, however, is that we have developed a deeper understanding of the market and the digital ecosystem in the country. We now better understand the users. We now understand how people react to content and types of content people consume and other nuances of digital marketing.
Future Startup
Please tell about the culture at Magnito Digital. How do people work and collaborate?
Riyad Shahir Ahmed Husain
We maintain a flat organizational structure and there is almost no office politics here. We have a friendly environment. People who leave us for other companies often tell that our culture is distinct than any other company.
In fact, many of our team members who had left our company have returned to Magnito, which proves that we have been able to build a great working culture for people. In the last 18 months, 11 people have returned to Magnito!
Structurally, we have independent departments for almost all the functions that are lead by managers of those departments, who are sufficiently empowered to make decisions.
Above the mid-level management, we have a top management team that includes Vicky Khawar Ahmed and myself. Vicky is our COO, who looks after our entire operations. He has been an amazing resource and works more as a Deputy CEO. We have our Creative Director Kaushik De who takes ownership of our entire creative operation.
Future Startup
You have over a decade of experience in building businesses in Bangladesh in a host of industries including digital and food, what are some of the biggest lessons from all those years?
Riyad Shahir Ahmed Husain
The number one lesson is that teamwork is indispensable if you want to build a good business. I have been very lucky to have very good partners in all my endeavors. It does not always happen to people.
Root Marketing was my first company and during that time we had a printing press business as well. Magnito Digital is my third venture. I started my journey into food business with Wow Burger. After Wow Burger, we launched Tokyo Express along with a few partners. After Tokyo Express we launched another restaurant called Little Korea.
From all these initiatives my key lesson is that having good partners is important. Your success largely depends on it.
The other thing is not being selfish. If you think only about yourself then you would not be able to grow. You have to think about collective good which will help you move forward.
So if you surround yourself with good partners and honest people who work with sincerity and integrity, things get a lot easier.
It sounds obvious and a cliché but business is all about basics. You produce something, sell it and make a profit. That’s business at the end of the day. My focus has always been the numbers. How much I invested, sold and earned. When you start compromising on this, then there is a problem. You have to be very strict about it. When you focus on these basic things, it is easy to build a solid business and your chance of failure goes significantly down.
Future Startup
This is a tricky question but many people want to understand this, how does pricing work in a service business? How do you design your pricing strategy at Magnito?
Riyad Shahir Ahmed Husain
It’s a tricky question for sure! In industries like the food, it is quite simple. You calculate your cost of goods sold and overheads, add a markup on it and then come to a final price.
For us, it is a little tricky since we don’t offer any product. For us, the raw material is the time of our people.
When we take on a project we calculate the amount of involvement different people of the team will have to invest in order to deliver the project and then we calculate the value of their time based on their remuneration and then we add a markup and offer the final price.
Future Startup
What does it take to build a sustainable business?
Riyad Shahir Ahmed Husain
You first need a vision and then you need strong leadership to implement that vision! In order for you to be a strong leader, you need to build good relationships.
As I mentioned earlier, building relationship takes work. You have to have integrity. You have to deliver true value.
The other thing is quite simple. At the end of the day, business is all about sales. I see many companies these days who are more bothered about valuation than sales.
It sounds obvious and a cliché but business is all about basics. You produce something, sell it and make a profit. That’s business at the end of the day.
My focus has always been the numbers. How much I invested, sold and earned. When you start compromising on this, then there is a problem.
You have to be very strict about it. When you focus on these basic things, it is easy to build a solid business and your chance of failure goes significantly down.
Future Startup
How do you think about sales? How do you become a good salesman?
Riyad Shahir Ahmed Husain
Rule number one: understanding the product that you are selling. If you don’t understand the product that you are selling then it is futile to try to convince other people to buy it.
The next step is you should have some success stories of your work which you can use as case studies. It is important to use them as references to prove your ability.
Then you have to offer something different than what is already available in the market. Understanding the market and your competition also helps.
A client usually looks for a few things: whether you understand the industry, the product you are talking about, whether you know your work, whether you have a relevant track record and whether you can offer something different than what is available in the market.
We have invested in an artificial intelligence company called Fox Ai, through which we plan to explore these areas where we believe the next big opportunity lies. That’s one of the major plans. We plan to launch it early next year.
Future Startup
You help other companies with their marketing in the digital space. How does your marketing work?
Riyad Shahir Ahmed Husain
We mostly use social media for our promotional activities. Apart from that, we value the importance of PR very much. Whenever we do something good and newsworthy we don’t feel shy about letting people know about it.
Future Startup
What are the future plans?
Riyad Shahir Ahmed Husain
As I mentioned earlier, every year we try to evolve as a company. Now that we are completing our five years, we think that we have come to a crossroad and that this is the end of phase one.
The next few years are also very important for us. Now we are investing in a couple of areas which we think is critical for our growth and scale going forward.
We have identified that messaging is growing very fast across the world. It is becoming the de facto mode of communication in offices and in many other places.
People now communicate in smaller groups in different platforms such as WhatsApp groups, Viber groups, Facebook Messenger groups etc.
What strategies should brands apply here? How can brands leverage these chat apps to their advantage? We have realized that this is going to be the next big thing and that brands will have to communicate on a constant basis within these communities. Customer service and brand communications will move to chat apps. How do we scale customer service in chat apps? By utilizing artificial intelligence. That’s where our next growth strategy comes in.
We have invested in an artificial intelligence company called Fox Ai, through which we plan to explore these areas where we believe the next big opportunity lies. That’s one of the major plans. We plan to launch it early next year.
The company will solely work in the field of artificial intelligence. We want to start by focusing on customer service and then gradually explore other areas. The idea is to use digital channels to provide customer service by using AI.
Another area we are exploring is producing original content. We believe that the next generation of digital contents will be dominated by branded content or native content. We have invested in an original video content making company called M5 Studios, which will work in the area of producing original video content in collaboration with brands.
There is a lot of need for video content in Bangladesh. There are platforms such as Netflix, Bongo, Bioscope, WowBox, Bangla Flix, who will be needing a large number of local contents. An increasing number of people are now consuming content on small screens which we believe offer a wonderful opportunity.
These will be two separate companies and they will work independently.
The role of technology will be more pervasive in marketing. Digital agencies will need to be more technologically advanced.
Future Startup
What do you think about the future of digital marketing?
Riyad Shahir Ahmed Husain
I think conventional banners are going down in the near future. Consumers already avoid these ad units. Many brands are already looking for alternative ways to engage with their consumers.
User experience is going to be a lot more important in everything you do.
The other major trend is personalization. It will become the driver of digital advertising.
The role of technology will be more pervasive in marketing. Digital agencies will need to be more technologically advanced.
Future Startup
How do you operate as a CEO? What does it take to be an effective CEO?
Riyad Shahir Ahmed Husain
Once upon a time, I used to micro-manage and could not delegate properly, which was always a big challenge for me. Over the years, I have learned to delegate and also learned that without delegation, you can never grow and become an effective manager.
I now empower my team to make decisions which allows me time to think and focus on strategic issues and future growth.
I empower my team when it comes to day to day operations and I get involved only in making major decisions. This has helped us to develop our people and build their capacity while growing our business.
The other thing is communication. The importance of communicating your vision and plans with your team is essential. It helps to keep everyone on the same page.
Future Startup
How do you deal with stress and challenges that come with being an entrepreneur?
Riyad Shahir Ahmed Husain
Stress is a common denominator of being an entrepreneur. It comes with the territory. I feel particularly stressed when I am unable to balance family time with work. I feel there will always be challenges and it is our job to figure it out what works best for us.
Personally, for me, prayer does help to deal with stress.
I think I would have been a more efficient person if I could control my social media usage more effectively! It definitely is distracting and takes up a lot of time. However, given the nature of my business, I still have to have in an “Always-On” mode myself!
Future Startup
What advice would you give to people who are just starting out?
Riyad Shahir Ahmed Husain
Young people these days are very impatient. You cannot build anything meaningful overnight, which is, unfortunately, a tendency we see prevalent among our youth. It may even take up to decades to do something big.
The second thing that I feel is that young people should dig deeper into things and go more into the depth of things. They should explore problems and opportunities more rigorously.
There may be a reason behind this. Growing up in the early 90’s, we were not exposed to these much distractions. When I was in university, there was nothing called a smartphone. So we had a rather calm and “no-distraction” upbringing. These days, it is much harder to focus, even for myself!
I strongly feel that young people should focus more on what they are doing and be patient.
Future Startup
How do you use social media and other technology in your personal life?
Riyad Shahir Ahmed Husain
I think I would have been a more efficient person if I could control my social media usage more effectively! It definitely is distracting and takes up a lot of time.
However, given the nature of my business, I still have to have in an “Always-On” mode myself!
However, I think we should be more responsible and mindful of how we use technology.
Young people these days are very impatient. You cannot build anything meaningful overnight, which is, unfortunately, a tendency we see prevalent among our youth. It may even take up to decades to do something big.
