This Q&A first appeared in DNA Money edition on Monday, Mar 25, 2013.
Agnello Dias, co-founder and chief creative officer, Taproot India, one of the most promising creative agencies in India, says 2013 will be an exciting year for his company. In conversation, he spoke about the industry trends and company's plans... Excerpts from the interview:
On key trends in advertising especially on the creative side.
The most striking trend I see in the Indian advertising industry is that there is a great focus on realistic portrayal of people’s lives, emotions, etc as opposed to a fantasy release. This approach is only getting bigger by the day and advertising will become more raw and hardcore like in the real world as compared with advertising earlier, which was very glossy.
Impact on creativity due to increase business pressures
I think the quantity of work some agencies take up is actually much more than is possible to be done in that time and things get rushed, as a result there is less time to execute the work. This leads to creativity suffering and that’s not good for the Indian advertising industry. The fraternity is not taking a note of it and is just carrying on with their approach to business.
On campaigns being currently worked on
Current projects include a few campaigns for Pepsi and 7UP in addition to working on a series of campaigns for clients for the upcoming IPL series.
On billings and growth expected in 2013
I cannot disclose financial details pertaining to billing and growth. Having said that, we are hoping to do some exciting work this year and add new categories to our portfolio of clients. For instance, India’s leading cables and wires company Polycab has recently released their first television commercial (TVC) campaign that was conceptualised by us. Home appliances is another category that we will be involved in.
On rolling out of NourishCo campaign
Yes that has started rolling out but since the product is being initially made available in Tamil Nadu and Andhra Pradesh, the campaign will first break in these two states some time next month and will eventually go national.
On traditional and new media debate
I think that change will certainly happen eventually but India has a very vast and varied mindset unlike the West where it is very homogeneous. So the change will not happen overnight and the upper end will move first, which is already happening. So while it would take one year for the change to take place in a homogeneous mindset market, my understanding is it will take 7-8 years for the entire industry in a market like India.
As for mobile advertising, people who are more technically inclined or technologically friendly would lean towards those products before actual conceptual creativity comes in play. That will be the generation when the technical side of it will be specified and genuine creativity will follow. Like in case of print to television, initially there were not so much of the creative people doing film or television but people who understood the medium better and not necessary creative. Now it has completely moved to creative people actually working in that area.
On sweeping awards year after year
We try and do our best every year and sometimes we do well. At our stage every year is a big year. So there are times when our best works are perceived by everyone in the fraternity as good and sometimes they are not.
On the impact of slowdown on business
When the storm hits the sea, the bigger ships get impacted first. Same is the case with the advertising industry. The larger agencies get impacted first by the slowdown and we are too small in size to get affected.
Follow Ashish K Tiwari on twitter @ashishktiwari
Sunday, 14 April 2013
Clients are getting comfortable with smaller ad agencies: Santosh Padhi
This Q&A first appeared in DNA Money edition on Saturday, Mar 23, 2013.
At the recent Adfest 2013 event in Pattaya, Thailand, advertising agency Taproot India (now part of Dentsu India Group) won 11 ‘metals’, the most-awarded among the 33 offices from 16 Asian countries. Santosh Padhi, Taproot’s chief creative officer, feels although success is second nature to the agency, being adjudged the ‘Creative Agency of the Year’ was still 'a big surprise'. Excerpts from the interview:
You reaped a bumper harvest at Adfest 2013.Yes, we bagged 11 metals. That is a huge number for us. We always thought we have a great body of work and will do fairly well at Adfest which applauds Asian work, unlike Cannes and a few other festivals. But we never thought we will be adjudged one of the best offices in Asia. That’s really a big surprise for us and we are all under tremendous pressure now to ensure we are able to retain the market credibility. I think it’s a good pressure to have.
How have things changed at Taproot after Dentsu’s entry?
To be frank, nothing really has changed in the way Taproot is operating. They are doing their own stuff and so are we. The only exception is in the reporting structure, in terms of finances, where we are doing it every quarter now. Dentsu has given us a free hand and the management feels we are running the business fantastically, so there is really no need for them to dictate terms.
Besides, the Dentsu management has assured us of all the support we would need to deliver the best possible results for our clients. While we have been doing well on our own, NourishCo (the Tata Global Beverages and PepsiCo India joint venture) is one incident wherein a joint pitch was made with Dentsu. NourishCo wanted more than a creative thing, so we leveraged on Dentsu’s expertise in other areas like activation, research, so on. I think we will have many more such opportunities to work together in future and deliver something that’s more solid.
One-stop solutions providers are in. Is there enough scope for creative-focused entities now?
There is a need for every sort of service in the industry. While some clients believe in agencies that are an end-to-end service or solutions provider, there are others that believe in going to the specialist agencies for solutions. This approach, in my opinion, is the new-age thinking from the client’s side. From what I see, there is enough business for all formats and clients will choose based on what it is that they are really looking for, in terms of delivery. Clients these days are very matured and know who is delivering what. In fact, clients are getting more and more comfortable with smaller agencies as they know that the guy sitting across the table is also the guy who will be working on the campaign.
Has there been a change in the client’s perception about Taproot now that it’s part of a global advertising giant?
We’d taken our clients into confidence when doing the deal with Dentsu and they knew we’d continue to work and service them the same way as before. So, no significant change in perception there. From Taproot’s perspective, I think we were lucky to get assignments from the likes of Pepsi, Airtel, Marico. But if you want more bigger brands like these in the portfolio, you’d either have to be extremely lucky again and again and again or partner somebody and by default you get the big canvas. One of the reasons we partnered Dentsu is that they have some really big clients who will launch products and brands in the Indian market and we will get to work on their campaigns
Follow Ashish K Tiwari on twitter @ashishktiwari
At the recent Adfest 2013 event in Pattaya, Thailand, advertising agency Taproot India (now part of Dentsu India Group) won 11 ‘metals’, the most-awarded among the 33 offices from 16 Asian countries. Santosh Padhi, Taproot’s chief creative officer, feels although success is second nature to the agency, being adjudged the ‘Creative Agency of the Year’ was still 'a big surprise'. Excerpts from the interview:
You reaped a bumper harvest at Adfest 2013.Yes, we bagged 11 metals. That is a huge number for us. We always thought we have a great body of work and will do fairly well at Adfest which applauds Asian work, unlike Cannes and a few other festivals. But we never thought we will be adjudged one of the best offices in Asia. That’s really a big surprise for us and we are all under tremendous pressure now to ensure we are able to retain the market credibility. I think it’s a good pressure to have.
How have things changed at Taproot after Dentsu’s entry?
To be frank, nothing really has changed in the way Taproot is operating. They are doing their own stuff and so are we. The only exception is in the reporting structure, in terms of finances, where we are doing it every quarter now. Dentsu has given us a free hand and the management feels we are running the business fantastically, so there is really no need for them to dictate terms.
Besides, the Dentsu management has assured us of all the support we would need to deliver the best possible results for our clients. While we have been doing well on our own, NourishCo (the Tata Global Beverages and PepsiCo India joint venture) is one incident wherein a joint pitch was made with Dentsu. NourishCo wanted more than a creative thing, so we leveraged on Dentsu’s expertise in other areas like activation, research, so on. I think we will have many more such opportunities to work together in future and deliver something that’s more solid.
One-stop solutions providers are in. Is there enough scope for creative-focused entities now?
There is a need for every sort of service in the industry. While some clients believe in agencies that are an end-to-end service or solutions provider, there are others that believe in going to the specialist agencies for solutions. This approach, in my opinion, is the new-age thinking from the client’s side. From what I see, there is enough business for all formats and clients will choose based on what it is that they are really looking for, in terms of delivery. Clients these days are very matured and know who is delivering what. In fact, clients are getting more and more comfortable with smaller agencies as they know that the guy sitting across the table is also the guy who will be working on the campaign.
Has there been a change in the client’s perception about Taproot now that it’s part of a global advertising giant?
We’d taken our clients into confidence when doing the deal with Dentsu and they knew we’d continue to work and service them the same way as before. So, no significant change in perception there. From Taproot’s perspective, I think we were lucky to get assignments from the likes of Pepsi, Airtel, Marico. But if you want more bigger brands like these in the portfolio, you’d either have to be extremely lucky again and again and again or partner somebody and by default you get the big canvas. One of the reasons we partnered Dentsu is that they have some really big clients who will launch products and brands in the Indian market and we will get to work on their campaigns
Follow Ashish K Tiwari on twitter @ashishktiwari
Kanakia to exit Ahmedabad hotel
This story first appeared in DNA Money edition on Tuesday, Mar 19, 2013.
The promoters of Kanakia Group have begun the process of divesting their stakes in four hotel projects by putting the upcoming Novotel branded five-star hotel in Ahmedabad on the block.
Private equity firm Sun Apollo, which owns the land on which the project is coming up, will also exit the project. “Offer for sale has been floated in the market for the mixed-use development comprising the hotel and commercial components,” said a source.
Rasesh B Kanakia, chairman of the eponymous group, confirmed the selloff plan. “The hotel, now in the final stage of construction, is expected to get operational by June. We will exit the development at the right price.”
Kanakia has mandated the Indian arm of an international property consultant (IPC) to find a buyer.
Located off the Sarkhej-Gandhinagar highway, the mixed-use development features 176 hotel rooms, eight serviced apartments, food and beverage courts, meeting and banqueting facilities, a business centre and office space spread across two floors.
The hotel will be managed by Accor Group, the international hotel chain.
Kanakia did not share details about the money spent on developing the project. A 2011 environment clearance proposal submitted by the asset holding company, Atithya Inn, had estimated the project cost to be Rs124.44 crore, and said it will feature 235 guest rooms in all and 43 offices.
Typically, prospective buyers look for either a pre-operation or three-year-old hotels that have already settled in the market, said Kanakia. “We are developers. We will build hotels and sell them if the right opportunity comes by.”
Kanakia has one operational hotel (Courtyard by Marriott) in north Mumbai while another three projects are under various stages of development, including an Ibis (location unknown) and a Hyatt Place (Goa).
Kanakia has already sold the Cinemax multiplex chain to PVR earlier this year.
Follow Ashish K Tiwari on twitter @ashishktiwari
The promoters of Kanakia Group have begun the process of divesting their stakes in four hotel projects by putting the upcoming Novotel branded five-star hotel in Ahmedabad on the block.
Private equity firm Sun Apollo, which owns the land on which the project is coming up, will also exit the project. “Offer for sale has been floated in the market for the mixed-use development comprising the hotel and commercial components,” said a source.
Rasesh B Kanakia, chairman of the eponymous group, confirmed the selloff plan. “The hotel, now in the final stage of construction, is expected to get operational by June. We will exit the development at the right price.”
Kanakia has mandated the Indian arm of an international property consultant (IPC) to find a buyer.
Located off the Sarkhej-Gandhinagar highway, the mixed-use development features 176 hotel rooms, eight serviced apartments, food and beverage courts, meeting and banqueting facilities, a business centre and office space spread across two floors.
The hotel will be managed by Accor Group, the international hotel chain.
Kanakia did not share details about the money spent on developing the project. A 2011 environment clearance proposal submitted by the asset holding company, Atithya Inn, had estimated the project cost to be Rs124.44 crore, and said it will feature 235 guest rooms in all and 43 offices.
Typically, prospective buyers look for either a pre-operation or three-year-old hotels that have already settled in the market, said Kanakia. “We are developers. We will build hotels and sell them if the right opportunity comes by.”
Kanakia has one operational hotel (Courtyard by Marriott) in north Mumbai while another three projects are under various stages of development, including an Ibis (location unknown) and a Hyatt Place (Goa).
Kanakia has already sold the Cinemax multiplex chain to PVR earlier this year.
Follow Ashish K Tiwari on twitter @ashishktiwari
'International architects are attracted to India's strengths'
This Q&A first appeared in DNA Money edition on Sunday, Mar 17, 2013.
Starting with designing luxury boutique Blakes Hotel in London, Anouska Hempel, promoter of international design and architectural practice Anouska Hempel Design (AHD), went on to design critically-acclaimed luxury hotels, restaurants, private residences, yachts, retail and products throughout the world.
One of world’s most celebrated designers, Hempel was in Mumbai recently to participate at the India Design Forum 2013. In conversation, she shared views about the design market in India and work AHD is doing for Indian clients. Here are some excerpts...
What are your views on the design market in India?
The market is most extraordinary and going from strength to strength. India is refining and redeveloping itself. A lot of architects from developed economies are attracted to the strengths of India, especially on the commercial level. In fact, I think there are a host of other people coming to India all the time to create things and be influenced by the country.
Are you working on any project in India?
Nothing at the moment sadly.
What about any international project that’s owned by an Indian?
Yes , I am doing a city hotel project in Santiago. This development is owned by an Indian client based out of Jaipur. I’m are also designing their house in Singapore.
Why haven’t you taken up a project in India as yet?
I have been approached from time to time but haven’t had the proper opportunity to conclude anything here. While there are a host of designers doing similar stuff, I don’t and hence, tend to be a risky bet.
What would be your dream project in India?
I’d love to do a boutique hotel with a proper Indian flavour. It could be a certain period like the turn of the century, going back to the Maharaja era or something that gives a museum like quality to my work.
We have had the likes of Giorgio Armani being signed up for landmark developments by Indian companies. Are you considering such associations as well?
Yes, I’ve heard about it. I like such partnerships and I think they do quite well. I am not that commercially structured, so, an Indian company will have to take me on board for their projects and I’d come willingly. I’d really like to do something that’s an important landmark development here.
Follow Ashish K Tiwari on twitter @ashishktiwari
Starting with designing luxury boutique Blakes Hotel in London, Anouska Hempel, promoter of international design and architectural practice Anouska Hempel Design (AHD), went on to design critically-acclaimed luxury hotels, restaurants, private residences, yachts, retail and products throughout the world.
One of world’s most celebrated designers, Hempel was in Mumbai recently to participate at the India Design Forum 2013. In conversation, she shared views about the design market in India and work AHD is doing for Indian clients. Here are some excerpts...
What are your views on the design market in India?
The market is most extraordinary and going from strength to strength. India is refining and redeveloping itself. A lot of architects from developed economies are attracted to the strengths of India, especially on the commercial level. In fact, I think there are a host of other people coming to India all the time to create things and be influenced by the country.
Are you working on any project in India?
Nothing at the moment sadly.
What about any international project that’s owned by an Indian?
Yes , I am doing a city hotel project in Santiago. This development is owned by an Indian client based out of Jaipur. I’m are also designing their house in Singapore.
Why haven’t you taken up a project in India as yet?
I have been approached from time to time but haven’t had the proper opportunity to conclude anything here. While there are a host of designers doing similar stuff, I don’t and hence, tend to be a risky bet.
What would be your dream project in India?
I’d love to do a boutique hotel with a proper Indian flavour. It could be a certain period like the turn of the century, going back to the Maharaja era or something that gives a museum like quality to my work.
We have had the likes of Giorgio Armani being signed up for landmark developments by Indian companies. Are you considering such associations as well?
Yes, I’ve heard about it. I like such partnerships and I think they do quite well. I am not that commercially structured, so, an Indian company will have to take me on board for their projects and I’d come willingly. I’d really like to do something that’s an important landmark development here.
Follow Ashish K Tiwari on twitter @ashishktiwari
GroupM top boss says India is a good short- and long-term bet
This Q&A first appeared in DNA Money edition on Thursday, Mar 14, 2013.
GroupM, WPP's consolidated media investment management operation, has a 40% market share in India and expects a double-digit growth to top that this year, Dominic Proctor, president, GroupM Global, told in an interaction.
It’s been a little over a year since you took over as president. Can you share some highlights?
We have been concentrating mainly on 2-3 things. First of all, we are putting a lot of emphasis behind our digital practice around the world and in India. As the whole business changes from an analogue to digital, it requires a lot of investment in people, technology, infrastructure etc. So we are paying a lot of attention there. On the trading side, we are optimising the clients’ expenditures, finding the right media to spend it on and making sure they are getting value for money. So, ensuring proper return on investment (RoI) is another area of focus. We buy approximately 30% of the global media. This gives us a strong market positioning and we are also working on developing our leadership positioning in some of the other markets globally.
How does India fare in your focus areas?
India is developing and strong market for GroupM with over 40% market share. Of the $90 billion global billings, India contributes around 6%, or $5.6 billion. We are very optimistic, and expect double-digit growth this year as well. Overall, I think India is a good short- and long-term bet.
How do you view the Indian advertising, media and entertainment sectors?
We are very bullish about India. We think that the marketing or media and entertainment (M&E) sector in the country is growing and will continue to grow ahead of the general economy. The government’s general economy forecast is round about 5% growth this year, over 2012, and we think the M&E sector would double in 2013, growing round about 10% in 2013 on a cautious note and I wouldn’t be surprised if the growth exceeded that number.
What is the key challenge for Indian M&E players?
I think, in a financial sense, India is fairly strong and growing ahead of the global averages, which is very great for the media business here. One of the challenges with content in the Indian media business is that it’s quite introspective. By that I mean, if you look at the strength of the film business here it’s wonderfully strong. As a proportion of GDP, it is the strongest in the world. But it is very much focussed in the Indian population or the diaspora. The same is probably true with the music business and sports, which is dominated by cricket.
How is GroupM dealing with challenges of digital media?
We are bringing in talent that’s very focused on the mobile. We have business called Madhouse, which is a joint venture with our Chinese business. And the challenges Madhouse and our agencies have is how to take the vast numbers of hours being spent eyeballing mobile devices but the dollars or rupees haven’t yet followed. So basically the way we tackling it is by investing in the talent to bring the clients to the opportunity.
Does GroupM have any plans to look at inorganic growth in India?
Most of our business growth has been organic / internal, which is in some ways is easier to control and culturally consistent. We certainly have a very open mind to looking at acquisitions. Most often it is a question of pricing and because we are the biggest players in the market, we might not have the need to make expensive acquisitions compared to other who have smaller positions in the market and need to spend often over the top to bolster their resources. While we are very careful about that, we are not closed to the idea of making acquisitions in specialist areas like digital, content, mobile, analytics etc.
Follow Ashish K Tiwari on twitter @ashishktiwari
GroupM, WPP's consolidated media investment management operation, has a 40% market share in India and expects a double-digit growth to top that this year, Dominic Proctor, president, GroupM Global, told in an interaction.
It’s been a little over a year since you took over as president. Can you share some highlights?
We have been concentrating mainly on 2-3 things. First of all, we are putting a lot of emphasis behind our digital practice around the world and in India. As the whole business changes from an analogue to digital, it requires a lot of investment in people, technology, infrastructure etc. So we are paying a lot of attention there. On the trading side, we are optimising the clients’ expenditures, finding the right media to spend it on and making sure they are getting value for money. So, ensuring proper return on investment (RoI) is another area of focus. We buy approximately 30% of the global media. This gives us a strong market positioning and we are also working on developing our leadership positioning in some of the other markets globally.
How does India fare in your focus areas?
India is developing and strong market for GroupM with over 40% market share. Of the $90 billion global billings, India contributes around 6%, or $5.6 billion. We are very optimistic, and expect double-digit growth this year as well. Overall, I think India is a good short- and long-term bet.
How do you view the Indian advertising, media and entertainment sectors?
We are very bullish about India. We think that the marketing or media and entertainment (M&E) sector in the country is growing and will continue to grow ahead of the general economy. The government’s general economy forecast is round about 5% growth this year, over 2012, and we think the M&E sector would double in 2013, growing round about 10% in 2013 on a cautious note and I wouldn’t be surprised if the growth exceeded that number.
What is the key challenge for Indian M&E players?
I think, in a financial sense, India is fairly strong and growing ahead of the global averages, which is very great for the media business here. One of the challenges with content in the Indian media business is that it’s quite introspective. By that I mean, if you look at the strength of the film business here it’s wonderfully strong. As a proportion of GDP, it is the strongest in the world. But it is very much focussed in the Indian population or the diaspora. The same is probably true with the music business and sports, which is dominated by cricket.
How is GroupM dealing with challenges of digital media?
We are bringing in talent that’s very focused on the mobile. We have business called Madhouse, which is a joint venture with our Chinese business. And the challenges Madhouse and our agencies have is how to take the vast numbers of hours being spent eyeballing mobile devices but the dollars or rupees haven’t yet followed. So basically the way we tackling it is by investing in the talent to bring the clients to the opportunity.
Does GroupM have any plans to look at inorganic growth in India?
Most of our business growth has been organic / internal, which is in some ways is easier to control and culturally consistent. We certainly have a very open mind to looking at acquisitions. Most often it is a question of pricing and because we are the biggest players in the market, we might not have the need to make expensive acquisitions compared to other who have smaller positions in the market and need to spend often over the top to bolster their resources. While we are very careful about that, we are not closed to the idea of making acquisitions in specialist areas like digital, content, mobile, analytics etc.
Follow Ashish K Tiwari on twitter @ashishktiwari
Publicis beefs up digital ops with Convonix buy
This story first appeared in DNA Money edition on Tuesday, Mar 12, 2013.
Publicis Groupe, the world’s third-largest communications firm, has acquired Convonix, a marketing and consultancy firm, as part of its plan to beef up its digital presence in India.
The company plans to make more buyouts in the coming months.
Srikant Sastri, country chair, VivaKi India, a Publicis Groupe company, told DNA Money, “We have some more acquisitions in the pipeline. Hopefully, in the next 4-6 weeks we will have more announcements to make. Once completed, these will be aligned with some of our other agencies in the group.”
Last year Publicis acquired four companies – Indigo Consulting, Resultrix, iStrat and MarketGate.
Sastri said, “When we acquired Resultrix in August 2012, the company got aligned to Zenith Optimedia. Similarly, Convonix has now been aligned to Starcom MediaVest Group (SMG). This acquisition makes it a fairly formidable digital operation for SMG now.”
Post acquisition, Convonix will operate as SMG Convonix, with two market-facing brands: SMG Digital and Convonix.
Convonix offers a range of skills in the digital media space including search engine optimisation, search engine marketing, social media marketing, online reputation management, web analytics and conversion rate improvement.
It also recently developed a proprietary in-house brand monitoring and social listening platform called IrisTrack, which enables clients to gather market insight on their products and competitors and also engage customers online to improve their customer service.
Publicis has put together its strategy to build digital leadership about 18 months ago and was looking for both scale and full range of capabilities.
“What really attracted us was Convonix’s scale of 200-odd people breadth of skills/capabilities and quality of people,” said Sastri without disclosing financial details.
Though digital forms only Rs2,000 crore of the Rs30,000 crore Indian media market, the segment is one of the fastest growing at 30-35% annually.
“We have ourselves witnessed 98% growth in the digital space last year, which clearly indicates that it is a high growth market. Clients are increasingly focusing on and diverting a lot of spends in the digital space. We believe this is one area where we will achieve very quick leadership -- that’s an objective we have set for ourselves,” said Sastri.
Publicis has about 800 people in digital operations, largest in the country.
On mobile space, the company feels that mobile is still 18-24 months away from becoming a big part of the marketing spend of its clients.
“All agencies are experimenting and innovating with mobile, but the market is very small right now at Rs150 crore. As a result, it’s way below in terms of priority for clients. The mobile space is certainly going to be important in the future, but currently no one really has a big play here,” said Sastri.
Follow Ashish K Tiwari on twitter @ashishktiwari
Publicis Groupe, the world’s third-largest communications firm, has acquired Convonix, a marketing and consultancy firm, as part of its plan to beef up its digital presence in India.
The company plans to make more buyouts in the coming months.
Srikant Sastri, country chair, VivaKi India, a Publicis Groupe company, told DNA Money, “We have some more acquisitions in the pipeline. Hopefully, in the next 4-6 weeks we will have more announcements to make. Once completed, these will be aligned with some of our other agencies in the group.”
Last year Publicis acquired four companies – Indigo Consulting, Resultrix, iStrat and MarketGate.
Sastri said, “When we acquired Resultrix in August 2012, the company got aligned to Zenith Optimedia. Similarly, Convonix has now been aligned to Starcom MediaVest Group (SMG). This acquisition makes it a fairly formidable digital operation for SMG now.”
Post acquisition, Convonix will operate as SMG Convonix, with two market-facing brands: SMG Digital and Convonix.
Convonix offers a range of skills in the digital media space including search engine optimisation, search engine marketing, social media marketing, online reputation management, web analytics and conversion rate improvement.
It also recently developed a proprietary in-house brand monitoring and social listening platform called IrisTrack, which enables clients to gather market insight on their products and competitors and also engage customers online to improve their customer service.
Publicis has put together its strategy to build digital leadership about 18 months ago and was looking for both scale and full range of capabilities.
“What really attracted us was Convonix’s scale of 200-odd people breadth of skills/capabilities and quality of people,” said Sastri without disclosing financial details.
Though digital forms only Rs2,000 crore of the Rs30,000 crore Indian media market, the segment is one of the fastest growing at 30-35% annually.
“We have ourselves witnessed 98% growth in the digital space last year, which clearly indicates that it is a high growth market. Clients are increasingly focusing on and diverting a lot of spends in the digital space. We believe this is one area where we will achieve very quick leadership -- that’s an objective we have set for ourselves,” said Sastri.
Publicis has about 800 people in digital operations, largest in the country.
On mobile space, the company feels that mobile is still 18-24 months away from becoming a big part of the marketing spend of its clients.
“All agencies are experimenting and innovating with mobile, but the market is very small right now at Rs150 crore. As a result, it’s way below in terms of priority for clients. The mobile space is certainly going to be important in the future, but currently no one really has a big play here,” said Sastri.
Follow Ashish K Tiwari on twitter @ashishktiwari
JWT sees a game-changer in digital space
This Q&A first appeared in DNA Money edition on Monday, Mar 11, 2013.
Colvyn J Harris, chief executive officer, JWT, feels this is the best time for advertising agencies in India and that there is no other place he'd be at this point of time. In conversation, he spoke about the advertising agency's approach to business, organic and inorganic growth and business outlook for 2013. Edited excerpts...
Could you give us a sense of JWT’s business performance in the last few years?
The last three years have been very exciting and the rate of change of our growth has been much greater than it has been in say 2008 to 2009. In fact, I think India business is in a fabulous position when compared with say Europe, the US and the UK. There is no other place I’d rather be at this point of time than where we are currently. Unfortunately, we cannot share specific financial details, but I can tell you that we have had great recovery 2010 onward, clocking double-digit growth on a consistent basis. We have been able to get our growth trajectory in line with expectations and continue to look at a very steady growth in terms of topline.
What factors led to this growth?
While having our eyes on growth, we wanted it to come from certain business elements. This new changed focus as to how we look at our business is where we are seeing growth coming in. In the earlier days it was always the mainstream (print and television) advertising that ruled, however we are now focusing at a full 360 degree, seamless, end-to-end solution delivery to our clients. The approach is to put the brand/idea at the centre and do everything to deliver the idea effectively and efficiently. While the 90:10 ratio (between mainstream and digital) in terms of contribution to business growth still works, we are investing disproportionately in the digital world.
Was acquisition of Hungama part of the disproportionate investment exercise?
We were seeking to change from doing what the company always did to doing something very new. One of the approaches to do things differently was to try and digitise the entire company so that everyone starts to think digital. To bring in the change process we looked at the digital world in our search for a partner, which led to acquisition of Hungama.
We have invested significantly towards giving high quality digital exposure to our employees, and bringing Hungama into the fold is only helping make a significant impact in this space. With this acquisition, we have now created a full digital entity that may not be delivering in terms of revenues for now but it will certainly give us the experience and in-depth understanding of the digital space, thereby making ourselves future-ready. Anywhere in the global world a lot of decisions are being taken based on the digital space and we wanted to be ready to deliver the best for this new media space.
Are there more such opportunities in the pipeline?
Yes, we are looking at various spaces and will definitely pursue it.
Given the changing communications requirement of companies, are you looking to bring in new global intellectual property (IP) into the Indian market?
We have a global game plan in digital. There is a concept called ‘dot JWT’, which is basically a bouquet of large and admired digital companies that we’ve bought around the world. Based on the client’s needs in India, they can technically access the ‘dot JWT’ skills and capabilities in a seamless manner. A paid for service, the technology resides in the cloud and there is nothing stopping us from acquiring, accessing a global team to work on a client’s issue. If the client can dream it we will help deliver that dream.
How are the next 12 months looking like for JWT in terms of business?
While there is some anxiety on meeting the numbers, our ambition is growth and we are bullish about business.
Follow Ashish K Tiwari on twitter @ashishktiwari
Colvyn J Harris, chief executive officer, JWT, feels this is the best time for advertising agencies in India and that there is no other place he'd be at this point of time. In conversation, he spoke about the advertising agency's approach to business, organic and inorganic growth and business outlook for 2013. Edited excerpts...
Could you give us a sense of JWT’s business performance in the last few years?
The last three years have been very exciting and the rate of change of our growth has been much greater than it has been in say 2008 to 2009. In fact, I think India business is in a fabulous position when compared with say Europe, the US and the UK. There is no other place I’d rather be at this point of time than where we are currently. Unfortunately, we cannot share specific financial details, but I can tell you that we have had great recovery 2010 onward, clocking double-digit growth on a consistent basis. We have been able to get our growth trajectory in line with expectations and continue to look at a very steady growth in terms of topline.
What factors led to this growth?
While having our eyes on growth, we wanted it to come from certain business elements. This new changed focus as to how we look at our business is where we are seeing growth coming in. In the earlier days it was always the mainstream (print and television) advertising that ruled, however we are now focusing at a full 360 degree, seamless, end-to-end solution delivery to our clients. The approach is to put the brand/idea at the centre and do everything to deliver the idea effectively and efficiently. While the 90:10 ratio (between mainstream and digital) in terms of contribution to business growth still works, we are investing disproportionately in the digital world.
Was acquisition of Hungama part of the disproportionate investment exercise?
We were seeking to change from doing what the company always did to doing something very new. One of the approaches to do things differently was to try and digitise the entire company so that everyone starts to think digital. To bring in the change process we looked at the digital world in our search for a partner, which led to acquisition of Hungama.
We have invested significantly towards giving high quality digital exposure to our employees, and bringing Hungama into the fold is only helping make a significant impact in this space. With this acquisition, we have now created a full digital entity that may not be delivering in terms of revenues for now but it will certainly give us the experience and in-depth understanding of the digital space, thereby making ourselves future-ready. Anywhere in the global world a lot of decisions are being taken based on the digital space and we wanted to be ready to deliver the best for this new media space.
Are there more such opportunities in the pipeline?
Yes, we are looking at various spaces and will definitely pursue it.
Given the changing communications requirement of companies, are you looking to bring in new global intellectual property (IP) into the Indian market?
We have a global game plan in digital. There is a concept called ‘dot JWT’, which is basically a bouquet of large and admired digital companies that we’ve bought around the world. Based on the client’s needs in India, they can technically access the ‘dot JWT’ skills and capabilities in a seamless manner. A paid for service, the technology resides in the cloud and there is nothing stopping us from acquiring, accessing a global team to work on a client’s issue. If the client can dream it we will help deliver that dream.
How are the next 12 months looking like for JWT in terms of business?
While there is some anxiety on meeting the numbers, our ambition is growth and we are bullish about business.
Follow Ashish K Tiwari on twitter @ashishktiwari
Lintas expects uptick in client spends
This Q&A first appeared in DNA Money edition on Tuesday, Mar 5, 2013.
Joseph George, chief executive officer, Lowe Lintas & Partners, considers himself lucky to have handled a host of clients, categories and brands in the last over two decades. George’s first job was of a planner in 1990 when planning as a function did not exist in most agencies. “I remember, Arvind Sharma (chairman-India Subcontinent at Leo Burnett) was trying to launch something called Consumer Insight Based Strategy and I was among the first planners ever hired. In fact, I first came across the word consumer insight from him,” he reminisces. George spoke about his journey with the company, industry developments and future plans. Excerpts:
Working on Hindustan Unilever account must have been very exciting and insightful for you in terms of the overall business...
Yes it has. I’ve been hands-on with Unilever’s business for almost 18 years. It’s just that in the last couple of years I had to move into a larger role in the agency handling other things as well. While I’ve spent more time on HUL, there have been other interesting companies like Tanishq, Cadbury and, Johnson & Johnson.
After taking over as CEO early 2011, you went aggressively about increasing new business. Is that exercise over?
Not at all. My reason for doing it is very simple. I have been in this industry for long and I know the equity Lintas has in the market place. The equity is a lot larger than size of the company and I want to bridge that gap. We are not there yet, which is why it’s not getting over in a hurry and I will keep adding to it till we reach a certain point. That’s something I’m quite driven by, may be because I’ve been in this system and clearly know the brand’s potential. Many people think that only big clients come to us, that’s incorrect because we have made them big, and there are a few exceptions. You take any of our clients and I’ll be able tell you how many units they were selling before and after they came to us. In fact, most of clients we have started with us.
Brands these days appear to be trying their best to make a connection with the audience and act as catalysts in driving change...
A lot of brands are trying to bring about some positive change or make people think. Some of our communications for Tata Tea, Idea, and the recent Axis Bank commercial are being done to deliver that message of changing things for better. I was telling Balki (R Balakrishnan, chairman and chief creative officer, Lowe Lintas & Partners) the other day, if you look at most ads, they look like running a consumer promotion. He said, what do you mean by that? I said, with every ad we give the consumer something to think about for free. As in, Yeh ad hai... and we just leave a little thought...
In your observation, is this approach by brands a recent phenomenon?
It’s not that people have changed suddenly, but people’s orientation on how you want to proposition a brand has changed. There is a lot of difference when you are buying a brand and buying into a brand. When you buy into a brand, you want to buy everything that the brand stands for and which is why marketers try to infuse that little more about the brand than just the fact that it washes whitest or works the fastest. I see that happening more and more down the line especially with the advent of digital advertising that enables conversation and buzz around a brand. And in today’s competitive environment brands are creating a differentiation by working towards being more meaningful than the other one.
Any specific plans for 2013?
I am hoping that a lot of our clients who were holding back start spending a lot more. Our new business drive will continue with as much passion. We have some plans in our marketing services vertical that should unfold in the due course. We will expand our network by adding an office in the northern region. We will be focusing on some of the new divisions and re-focus on the existing verticals, for example public relations, which is doing well and I think we can do a lot better. We have film production business which should grow significantly as well. 2011 was a good year, 2012 was a bit of a disappointment, but I am hoping 2013 will be a much better year.
Is sports management an area of interest for you?
To me I think that’s the next big thing to happen. I think it offers a huge business potential. Getting into this area is inevitable because money in sports is only going to go up, it is not going to come down.
Follow Ashish K Tiwari on twitter @ashishktiwari
Joseph George, chief executive officer, Lowe Lintas & Partners, considers himself lucky to have handled a host of clients, categories and brands in the last over two decades. George’s first job was of a planner in 1990 when planning as a function did not exist in most agencies. “I remember, Arvind Sharma (chairman-India Subcontinent at Leo Burnett) was trying to launch something called Consumer Insight Based Strategy and I was among the first planners ever hired. In fact, I first came across the word consumer insight from him,” he reminisces. George spoke about his journey with the company, industry developments and future plans. Excerpts:
Working on Hindustan Unilever account must have been very exciting and insightful for you in terms of the overall business...
Yes it has. I’ve been hands-on with Unilever’s business for almost 18 years. It’s just that in the last couple of years I had to move into a larger role in the agency handling other things as well. While I’ve spent more time on HUL, there have been other interesting companies like Tanishq, Cadbury and, Johnson & Johnson.
After taking over as CEO early 2011, you went aggressively about increasing new business. Is that exercise over?
Not at all. My reason for doing it is very simple. I have been in this industry for long and I know the equity Lintas has in the market place. The equity is a lot larger than size of the company and I want to bridge that gap. We are not there yet, which is why it’s not getting over in a hurry and I will keep adding to it till we reach a certain point. That’s something I’m quite driven by, may be because I’ve been in this system and clearly know the brand’s potential. Many people think that only big clients come to us, that’s incorrect because we have made them big, and there are a few exceptions. You take any of our clients and I’ll be able tell you how many units they were selling before and after they came to us. In fact, most of clients we have started with us.
Brands these days appear to be trying their best to make a connection with the audience and act as catalysts in driving change...
A lot of brands are trying to bring about some positive change or make people think. Some of our communications for Tata Tea, Idea, and the recent Axis Bank commercial are being done to deliver that message of changing things for better. I was telling Balki (R Balakrishnan, chairman and chief creative officer, Lowe Lintas & Partners) the other day, if you look at most ads, they look like running a consumer promotion. He said, what do you mean by that? I said, with every ad we give the consumer something to think about for free. As in, Yeh ad hai... and we just leave a little thought...
In your observation, is this approach by brands a recent phenomenon?
It’s not that people have changed suddenly, but people’s orientation on how you want to proposition a brand has changed. There is a lot of difference when you are buying a brand and buying into a brand. When you buy into a brand, you want to buy everything that the brand stands for and which is why marketers try to infuse that little more about the brand than just the fact that it washes whitest or works the fastest. I see that happening more and more down the line especially with the advent of digital advertising that enables conversation and buzz around a brand. And in today’s competitive environment brands are creating a differentiation by working towards being more meaningful than the other one.
Any specific plans for 2013?
I am hoping that a lot of our clients who were holding back start spending a lot more. Our new business drive will continue with as much passion. We have some plans in our marketing services vertical that should unfold in the due course. We will expand our network by adding an office in the northern region. We will be focusing on some of the new divisions and re-focus on the existing verticals, for example public relations, which is doing well and I think we can do a lot better. We have film production business which should grow significantly as well. 2011 was a good year, 2012 was a bit of a disappointment, but I am hoping 2013 will be a much better year.
Is sports management an area of interest for you?
To me I think that’s the next big thing to happen. I think it offers a huge business potential. Getting into this area is inevitable because money in sports is only going to go up, it is not going to come down.
Follow Ashish K Tiwari on twitter @ashishktiwari
Frenemy format: Will McDonald's, CCD share table?
My colleague Nupur Anand co-authored this story appearing in DNA Money edition on Tuesday, Feb 26, 2013.
Imagine walking into a McDonald’s outlet for a McSpicy Paneer burger and also getting to pick up a cup of cappuccino from a Cafe Coffee Day (CCD) counter inside.
Going by a buzz, McDonald’s and CCD operators in India could very well team up to create co-located stores.
Officials of both companies denied the move.
“There has been no move to tie up with or create associations with Café Coffee Day or any other brand in India presently,” said Smita Jatia, managing director, Hardcastle Restaurants Pvt Ltd (McDonald’s west & south India operations).
K Ramakrishnan, president – marketing, Café Coffee Day, also refuted any such collaboration being worked out with McDonald’s.
Industry sources, however, say it makes sense for quick service restaurants (QSRs) to operate in a co-location format with rival brands that offer complementary product lines.
Call it the ‘frenemy format’, if you please. The least it can do for the players is help exploit synergies and increase footfalls and conversions by building on each other’s strengths and creating a fulfilling experience for customers.
“This may be for sharing property and floor space, for better supply chain management or for other franchisee synergies,” said Arvind Singhal, chairman, Technopak Advisors.
A recent collaboration between cafe chain Braista Lavazza and Mumbai based ice-cream chain Hokey Pokey is a case in point.
Under the tie-up, those visiting Barista outlets can also savour ice cream flavours specifically launched for the cafe chain, said Rohan Mirchandani, co-founder, Hokey Pokey.
It is akin to food courts, albeit on a much smaller scale, say experts.
“The only difference is that two complementing brands are coming together to jointly take up retail real estate and a launch co-located store,” said Harminder Sahni, founder and managing director, Wazir Advisors.
But there’s a caveat, said Devangshu Dutta, chief executive of consulting and advisory firm Third Eyesight. “Such offerings can work in certain catchment areas... But in case there is a conflict between what is being offered, then a format like this will not work.”
Follow Ashish K Tiwari on twitter @ashishktiwari
Imagine walking into a McDonald’s outlet for a McSpicy Paneer burger and also getting to pick up a cup of cappuccino from a Cafe Coffee Day (CCD) counter inside.
Going by a buzz, McDonald’s and CCD operators in India could very well team up to create co-located stores.
Officials of both companies denied the move.
“There has been no move to tie up with or create associations with Café Coffee Day or any other brand in India presently,” said Smita Jatia, managing director, Hardcastle Restaurants Pvt Ltd (McDonald’s west & south India operations).
K Ramakrishnan, president – marketing, Café Coffee Day, also refuted any such collaboration being worked out with McDonald’s.
Industry sources, however, say it makes sense for quick service restaurants (QSRs) to operate in a co-location format with rival brands that offer complementary product lines.
Call it the ‘frenemy format’, if you please. The least it can do for the players is help exploit synergies and increase footfalls and conversions by building on each other’s strengths and creating a fulfilling experience for customers.
“This may be for sharing property and floor space, for better supply chain management or for other franchisee synergies,” said Arvind Singhal, chairman, Technopak Advisors.
A recent collaboration between cafe chain Braista Lavazza and Mumbai based ice-cream chain Hokey Pokey is a case in point.
Under the tie-up, those visiting Barista outlets can also savour ice cream flavours specifically launched for the cafe chain, said Rohan Mirchandani, co-founder, Hokey Pokey.
It is akin to food courts, albeit on a much smaller scale, say experts.
“The only difference is that two complementing brands are coming together to jointly take up retail real estate and a launch co-located store,” said Harminder Sahni, founder and managing director, Wazir Advisors.
But there’s a caveat, said Devangshu Dutta, chief executive of consulting and advisory firm Third Eyesight. “Such offerings can work in certain catchment areas... But in case there is a conflict between what is being offered, then a format like this will not work.”
Follow Ashish K Tiwari on twitter @ashishktiwari
Medanta developing cost-efficient model for healthcare
My colleagues Beryl Menezes co-authored this story appearing in DNA Money edition on Monday, Feb 25, 2013.
Medanta - The Medicity, the multi-super specialty hospital chain, is working on a healthcare delivery model that could be made cost-efficient at all levels – village, mid-, secondary care and super-specialty – with a little tweaking.
Dr Naresh Trehan (pictured), chairman and managing director, Medanta, said that the company is conducting a pilot in Haryana, which, if successful, could be replicated based on its efficiency and economics.
“We are experimenting with it in Jhajjar, Haryana. We already have working models in place and will take a year or so to do the analysis,” said Trehan, who was recently awarded Ernst & Young Entrepreneur of the Year 2012 in the startup category.
On the potential of mobile healthcare in the country, Trehan said it could become very huge, going forward.
“IT-based, tele-medicine and mobile health will be the most vital links from ground up. In fact, we have already partnered with Airtel to offer tele-medicine services and will soon be getting into mobile tele-medicine,” he said.
Medanta has been treating 100,000 patients for free in some of the villages every year and is now expecting to connect patients in these villages through tele-medicine to the hospital’s centres for quick diagnostics, early detection, preventive measures and treatments.
While the healthcare delivery model has been self-funded at this stage, the company management will eventually have to look at other funding options once it has been perfected and reaches a particular scale.
Talking about the challenges in the healthcare industry, Trehan said the sector is stressed as human capital cost is on the rise and people want their inflation costs covered.
“As a result, efficiencies of scale will have to kick in,” he said.
To reduce disease burden, Trehan suggests providing five things to every village – clean drinking water, sanitation, garbage disposal, mosquito control and school.
Follow Ashish K Tiwari on twitter @ashishktiwari
Medanta - The Medicity, the multi-super specialty hospital chain, is working on a healthcare delivery model that could be made cost-efficient at all levels – village, mid-, secondary care and super-specialty – with a little tweaking.
Dr Naresh Trehan (pictured), chairman and managing director, Medanta, said that the company is conducting a pilot in Haryana, which, if successful, could be replicated based on its efficiency and economics.
“We are experimenting with it in Jhajjar, Haryana. We already have working models in place and will take a year or so to do the analysis,” said Trehan, who was recently awarded Ernst & Young Entrepreneur of the Year 2012 in the startup category.
On the potential of mobile healthcare in the country, Trehan said it could become very huge, going forward.
“IT-based, tele-medicine and mobile health will be the most vital links from ground up. In fact, we have already partnered with Airtel to offer tele-medicine services and will soon be getting into mobile tele-medicine,” he said.
Medanta has been treating 100,000 patients for free in some of the villages every year and is now expecting to connect patients in these villages through tele-medicine to the hospital’s centres for quick diagnostics, early detection, preventive measures and treatments.
While the healthcare delivery model has been self-funded at this stage, the company management will eventually have to look at other funding options once it has been perfected and reaches a particular scale.
Talking about the challenges in the healthcare industry, Trehan said the sector is stressed as human capital cost is on the rise and people want their inflation costs covered.
“As a result, efficiencies of scale will have to kick in,” he said.
To reduce disease burden, Trehan suggests providing five things to every village – clean drinking water, sanitation, garbage disposal, mosquito control and school.
Follow Ashish K Tiwari on twitter @ashishktiwari
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