No 2 in attitude, No 1 in product

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Maxus India is on the growth streak, no doubt. Right from 2006 till date, the agency has grown in size and stature. It’s new positioning - ‘Creativitis’ has helped in acquiring new businesses, attracting and retaining talent and now becoming a formidable player as far as awards are concerned. Work on Vodafone launch brought instant fame for the agency – the first-of-its kind roadblock activity that ever graced television screens in India. This year at GoaFest, Maxus won the maximum metals.

For Group M India Chief Vikram Sakhuja, Maxus is the No 2 agency after Mindshare among the media services brands in India (in size). And a lot of the credit, he says, goes to Managing Director Ajit Varghese who scripted the Maxus growth story post the exit of ex-CEO CVL Srinivas.

“Maxus has always been perceived to be a challenger brand. The image and attitude of brand Maxus seems to be one of those young and nimble, challenger brands. For it to be No 2 in size is a huge achievement and to a certain extent that’s a big tribute to Ajit. The agency is still very lean, hungry and innovative. Sometimes larger agencies have the potential baggage of trying to become heavy under size but that’s not the case with Maxus,” states Sakhuja.

It was under Varghese’s astute leadership that the agency won many accounts like the Viacom Group, L’Oreal, Parle, Google, Kerala Tourism to name a few, in 2010. A testimony of Ajit’s brilliance is shared by marketers who think of Maxus as partners in their long journey of brand building. Anuradha Aggarwal, Vice President – Marketing, Vodafone explains why Maxus has been an ideal partner. “In Vodafone, we pride ourselves in the great partnerships we keep. Our association with Maxus as our Media AOR since our inception; from Orange to Hutch to Vodafone has been one such successful partnership. Maxus has added a lot of value in maximising the returns on our media investments through effective media planning and buying skills right from the start. In this competitive and often chaotic world of telecom, Maxus’s efforts have been excellent in ensuring that we as a brand make a mark not only by making the brand salient through effective media choices but also through innovative media solutions and out of the box thinking.”

Varghese is also credited for getting the other practices right apart from conventional media – starting the digital practice, the activation business and the content business. The agency is also looking at advanced analytics.

In a recent development Varghese has been entrusted with the additional responsibility of handling the South Asian markets of Maxus. “It’s an exciting time for me and Maxus. I’m looking forward to taking the learnings of Maxus India to the neighboring countries. It’s a reflection of Maxus India’s success,” he says.

Varghese speaks to IMPACT on the success story of Maxus and the road ahead. Interview on next page.

Q] Congratulations Ajit! Apart from heading Maxus and Motivator in India, you now have the mandate to run the South Asian market for Maxus.

Thank you.

Q] How did this come along?

Well, Maxus as you know in the last four years has grown very well. And it’s a known fact that Maxus India is a big part of Maxus’ global network. So to me sharing our success and learnings to our neighbouring countries, is a natural extension. It just goes to show how successful Maxus India has been that it is now taking the responsibility in Bangladesh, Pakistan and Sri Lanka. We want to continue evolving our product in a similar way in the other countries.

Q] Did you see it coming?

Honestly, I was looking forward to more challenges. Handling Motivator and Maxus under the Group M stable was one of the challenges and then this additional responsibility of handling a few more countries. It’s going to be an exciting journey from here.

Q] Maxus has been fairly successful in terms of growth, businesses won and also the awards. What’s your secret recipe?

Maxus is successful, that’s good to hear. I would look at it as glass half full. We still have some way to go. I would actually put three-four factors on why we are here where we are. We charted out a10-year plan in 2005-06. We had ambitious growth targets. Our aim was to get the profile clients first and then consolidate those clients by contributing to their media product, delivering on the communication strategy, 360 degree media etc. Also, a very important part of the plan was: talent. We brought in a solid base of second line leadership that has the ability to lead clients to the growth trajectory besides their role of managing them. We changed our vision and positioning of the  company. We went in with the mindset of being a different agency. ‘Creativitis’, our new positioning helped us in becoming a ‘creative’ media agency as against the traditional media agency. We challenged the norms of the industry; brought in fresh ideas, so that brands could be more visible. So that was the phase from 2006 to 2010.

We wanted to be the best creative media agency in the country. Till 2006 we weren’t even  nominated at award shows, we’re now a consistent No 2 and more often than not No 1. That’s the reason why clients love to work with us; more number of clients want to work with us because they know we’ve created a distinct identity in a crowded market.

Q] The philosophy of Creativitis – the idea of being the ‘creative’ media agency is a positioning uniquely created for Maxus India, right?

Yes. Maxus globally is designed to be the local agency in each country. So we don’t want to replicate the same structure, same philosophy of the large agencies. Maxus is not a ‘me too’ agency. It’s a local agency of Group M in each country. Bigger agencies focus on global clients, multi countries. We want to focus on good brands and all the big brands of the local country – Indian MNCs. We don’t focus on size and getting volumes.

Q] Perhaps that’s the reason why you’ve been able to retain both Vodafone and Nokia accounts when globally the two majors aligned their media duties with other agencies.

Absolutely! If you look at Maxus’ client list in India, we probably have 95 per cent plus Indian clients. We don’t have global alignments at all. Not that we don’t want to, we would love to. But it’s just the attitude – we want to be the experts in the media industry in that particular country. So if you’re  best in that country, you will automatically have the best of the brands, best of the companies wanting to work with you in a very very local market like India.

Nokia and Vodafone have been an interesting retention for us. It’s a reflection of a combination of factors: great team – very passionate and committed to the business. Consistently if you look at three to five years, whether it’s planning, buying or strategic thinking or is expertise across new media, traditional media, or the integration of media across, innovations… all these factors have contributed. The Group M clout too helped. Last but not the least, the leadership team. So if a client is seeing what he’s getting – a partner who is willing to deliver consistently over a period of time, why change?

Q] Probably having a new agency which is not complete in terms of infrastructure or resources is a risky affair. That might have gone in your favour.

I don’t think that’s the case. If you look at what led to the changes at the global level, they’re very different reasons. So those reasons don’t apply to large markets like India. Great partnerships are about understanding each other’s needs. And we’ve been learning from our clients as much as the expertise we put on to their brands. So if it’s a good long partnership, why break it.

Q] In 2010, you won a fair number of businesses?

Yes, in 2010 we got a great set of new clients such as L’Oreal, Parle, Google, the Viacom Group, Kerala Tourism etc. From 2006-2010, consistently, except for the slowdown in 2009, we’ve been going at 30 per cent plus growth rate. We grew by 30 per cent last year. It’s a reflection of what we did right in the process and the product. The other bit I think that worked for us in 2010 is we acquired the No 1 status in all the awards, except Emvies where we were the No 2 agency. We’ve won awards across a spectrum of clients. It just goes to say that our product is consistent across regions, across clients.

Q] Do you believe that awards can get you more business?

No. We don’t look at awards as contribution to great new business and stuff like that. Awards is a reflection of the fact that the industry recognises you; that there is something right about the things you do. It’s a good way of building morale in the team. It’s a representation of your work in the industry where clients can see, you can see and you feel satisfied and recognised. It encourages you to think more, think creatively.

Q] But you didn’t win anything at Cannes in 2010.

Yes, we didn’t. In 2009, we won three Shortlists and two Bronzes.

Q] Is it tough competing with Mindshare? Within the Group M stable, it’s an agency that is No 1 in the industry in terms of size.

Technically, there is no competition. We almost don’t pitch together for the same client. Both are at different life stages of establishment, processes and work culture. Both are completely different agencies. Mindshare is a global agency with large clients across various countries. Maxus has been positioned as the local agency of Group M. Both work on the strength on Group M house of media concept. Both agencies want to deliver the best for their clients. Where competition or a bit of friendly enemy comes in, is to do the best work. And that is healthy competition. It’s good for both the agencies – Mindshare and Maxus because No 1 status helps create new benchmarks. If we (Maxus) keep challenging them (Mindshare) and pushing the boundaries a bit more, it makes us a clear No 2 player. And it keeps inspiring us, challenges us to try to be the best.

Q] Are you eying to be No 1?

(Long pause) We want to be clearly No 2 in attitude. If that gives us No 1 in product, No 1 set of clients, No 1 in growth, so be it. We want to be No 2 in attitude and culture because that will really will make us strive harder and go that extra mile. That will clearly help us differentiate the product  and help us challenge the norms in the industry.

Our positioning of Creativitis and the communication architecture – Relationship Media - setting up the systems and processes which can satisfy big MNCs, so that they feel their business is in safe hands.

Q] Is there much focus on specific verticals?

Digital is something you’ve been talking about for a while. We’ve set up the activation team, content team, the trading team and the digital team. These teams are in place. As we move in 2012- 2013, we want to focus on the use of technology in our products. We want to be the experts in new age media. In a high growth, high fragmented market, how can we focus on our consumers better so that brands can do even better. The entire use of technology, the new age medium –we are going to make our systems and processes better equipped to handle that… lot of automation so that people can actually focus on discussions, understanding the consumers more. Those are the kind of things we want to do in the future. Integrating digital with traditional media is what we will look to do.

It’s a stage where we’re growing. So by 2013-2015 we should actually be seen as the apple among oranges. Clients, people, the whole industry should say ‘here is a different agency’. Also, we want to concentrate less on specific platforms and more on the consumer and how to reach him through an integrated media approach. So the biggest USP for any agency is today to embrace channel neutral planning, ability to integrate multiple media for a common objective and looking at getting ROI. Obviously, that has to be coupled by your expertise and your ability to execute on each of the platforms.

So we’ve invested in our digital team; we have almost 24 people in digital today and its growing 50 per cent every year. Few of our biggest clients are biggest in the industry as far as digital is concerned – Nokia, Vodafone, Google, Fiat. If you have the best brands, people would actually cut their little finger to work on these brands. And in digital for example, we’re investing behind not just display, we’re investing in creative, mobile, social, search… to me our biggest focus is how all of this is getting integrated to the communication architecture, focus on reaching to the consumer in the best integrated way, reducing wastage and not looking at individual platforms. That’s our biggest focus - to invest on the three verticals.

Q] Have you managed to attract and retain your talent?

For Maxus what we did is we actually targeted the kind of people we wanted. So clearly it was about getting the right person at the right job. We got the second line right. In some of the cases we had to wait for six to eight months to get that person in but we didn’t compromise on taking another person. If you look at the pyramid of media agencies in India, it is a low paid job. It is in the last leg of hierarchy both in terms of fame and money that you earn. We instilled that culture of media creativity, absolute passion in the business. Each person should believe that this is my company. The whole ‘my company’ attitude, the whole culture of fun and creativity, the whole culture of independence, less hierarchy has attracted and retained talent. So the culture makes people believe it’s their company. It’s not about money but about the passion for the business and the work they do. In our leadership team, there is an attrition less than 10 per cent.

Q] And overall?

In the last three years, it has been consistently below 15 per cent.

Q] Do you think there is a need to get in fresh talent from outside of the media industry?

You’re extremely right, we need to bring in fresh talent and that could come from marketing companies, digital houses, new media houses and technology houses. We’re actually relooking at the entire scenario for the next three years at this point in time and we’re completely going to open up a fresh talent and not necessarily from agencies.

Q] What is your view on this percentage model vis-à-vis the fee based remuneration model? The former gives you more stability while the latter is a risky affair.

If you look at growing markets, commission basis will always be better. And especially in India where media is the cheapest today. The industry is growing at 15 per cent and that is almost assured for the next few years. Brands will grow, investments will grow...so you’re not worried about failures in a growing market.

Q] What is your revenue split between commission and the fee based model?

Currently we’re 50:50. Half of our clients are on fee based and half on percentage. We are open to both structures. We encourage more and more incentive led remuneration because it is in our attitude to go that extra mile. And if there is a reward to go that extra mile we would be more than happy to do it. So we encourage lot of our clients to have an incentive structure where we actually get the push to deliver more.

Q] The whole thing about by-passing the media agency, you think is fair?

It doesn’t matter. If the agency is able to neutrally advise a client and that’s what they’re recruited for, this will all be one off cases. And to me if it helps you lower the rates or if something is happening directly and if that helps in bringing down the rates, and both - the channel partner and the client are happy, why should the agency have a botheration. It’s only helping the cause. If somebody is losing out in the equation, all three parties should be worried about it. We’re not bothered. We continue to deliver the best to our clients; we continue to be channel neutral. We advise our clients the best, and we don’t worry about the deal happing directly or indirectly. Is it really happening? I’m not sure.

Q] With hyper competition, do you feel the industry has lost track of ethics in the rat race of chasing businesses?

I wouldn’t be the best person to comment on ethics but what I would say is that in the short sightedness of our competition, we’re losing focus from our larger agenda. I think all of us can exist and co-exist. All of us have enough clients to work for, what probably is happening is in the short sightedness, in this quarterly and six monthly thinking is that you’re chasing the same clients, trying to do the same kind of work. Of the 10,000 clients that exist in India, we’re only focusing on the Top 200 or Top 500. So everybody is trying to chase the same cat. And there are enough cats in the market and we’re not able to focus on clients. We need to stop chasing the Top 2 or Top 10 clients and focus on what we have.

Q] Speaking of Goafest and the Media Abby, you were quoted saying that there was a lot of stinginess in the way awards were given away.

That happened at two levels. I was part of the jury and I felt there was some stinginess. This was the Goafest where maximum number of shortlists got announced. Almost more than 120 shortlists got announced. And if the maximum number of shortlists got announced, maximum number of metals should have been given away. And to me it sounded like least number of metals were given away. If you look at last three years, wherever we’ve won a lot of shortlists, we’ve almost converted 70 per cent of our shortlists into awards and this time out of 33 we only won 10. It’s not about losing to others; it’s about the absolute number itself was too low. And not giving Bronzes in certain award categories, I thought we could have been more liberal in celebrating success and rewarding good work in the industry.

Q] Coming back to Maxus. What is the one thing that keeps the agency going?

The ‘my company’ attitude which we’ve built. Each individual in this agency comes every morning to office thinking that it’s his company. With that comes the entire entrepreneurial spirit, the go-get-it done attitude. Other things such as the product, success, growth, retention of talent all are an outcome of this ‘my company’ spirit.

Q] So moving forward, the focus would be investments in three verticals – Content, Digital and Brand Activation.

Yes, these are going to be increasingly very important in the new age. It’s not about passive targeting of audiences where you’re going to put in on TV, Radio etc and assuming his attention is grabbed, but it’s about actually looking forward and engaging him, interacting with him; it’s about trying to get him to take that purchase decision. 

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