IPG mediabrands’ big bet on india is playing out and the company, helmed by Shashi Sinha, now commands 18-19% marketshare. It also plans to chart unexplored terrain in an attempt to grow this number further
In February 2012, when IPG Mediabrands announced its decision to formally launch in India, not many would have predicted that the company was set to make changes to its structure that would have repercussions on the industry itself. Not that the consequent media-holdingcompany- clout is new to India – GroupM, Aegis Media and even VivaKi Exchange (for buying) are some examples that are already working on leveraging advantages that come with consolidation. GroupM, leader by a significant margin, commands nearly 38- 40% marketshare. Madison Media, at around 12% marketshare with its agency brands Madison and Platinum, followed. But IPG Mediabrands’ decision to consolidate the might of Lodestar UM, Initiative and later BPN apart from Lintas Outdoor and Reprise catapulted it to second spot in the domain. India would be one of the few markets where IPG Mediabrands commands a leadership position of this kind, given the tough competition it faces from Omnicom Media Group and Publicis Groupe agencies in some of the other markets.
IPG Mediabrands corners 18-19% marketshare at present, and the clear task mandated to Shashi Sinha, the recently appointed CEO of IPG Mediabrands in India, is to grow this number further. Sinha, who believes that this consolidation brings great opportunities, is gearing up for the challenge.
VALUE-DRIVEN, NOT VOLUME-DRIVEN
IPG Mediabrands follows different structures for different markets. Some markets have rotating chairpersons from its operating companies UM and Initiative. Some keep the brands separate and in some markets, Mediabrands is the stronger entity. In an earlier conversation with IMPACT, Matt Seiler, CEO, IPG Mediabrands Worldwide had explained that a market’s dynamics and the strength of individual Mediabrands entities in that market eventually decided what avatar it took. But irrespective of the form, Mediabrands’ role essentially is of a facilitator and enabler. A role that now Sinha has to execute. He observes, “The structures have their own merits and it is important to exercise care on which structure to adopt, because one has to be sure that the brand identity and sanctity is protected. But another important fact is that now IPG Mediabrands is the clear No. 2 player in India. This can really help the company leverage benefits that not only come with scale, but also decisions such as how and where to invest.”
No plan is cast in stone, says Sinha, as he explains that while he has already crafted a way forward, it would take at least six months before the company’s best laid plans become apparent to the industry. The one thing he is clear about is that IPG Mediabrands’ way forward would be valuedriven and not volume-driven. Perhaps this is the reason why Sinha is not yet keen to grow IPG Mediabrands’ buying unit Magna’s power beyond intelligence to negotiations, as done by both GroupM and VivaKi Exchange. Instead, Sinha opts to first focus on areas that are otherwise difficult to invest in, in a volume-driven ecosystem.
PAY FOR PERFORMANCE, WITH A DIFFERENCE
In a market such as India, where volume matters, it is near impossible for operating units to invest in developing softer skills where return on investments is difficult to measure. IPG Mediabrands’ India agenda now allows such a skillset – analytics – to be on its immediate area of focus. Another area that is related and equally important for the company is CRM. “There is abundant data out there but very few people are leveraging it. Indian media is cheap today and many find it easier to invest in it for their communication plans, but this can change in the future given the advent of digitization and other changes the government has brought in. When that happens, micro-targeting will make a big difference. And if we are in a position to do that well, it will make all the difference,” remarks Sinha.
IPG Mediabrands is also upping its attention on branded content. While a final way forward is still to be agreed on, the company may have one branded content entity at a group level. The company will work to hone its Communication Planning Practice as well. But the trick would not be to master any one of this, but find a way of making all of this work together.
At an individual brand level, IPG Mediabrands has done its share of experiments already to be more confident about the differentiated offer it wants to make to marketers. Sinha divulges, “Matt (Seiler) has guided us on the pay for performance mantra and we executed a few pilots and other projects with some existing clients where we applied the principle with a twist, keeping the market nuance in mind. Clients want delivery and we told them that for a certain aspect of our service, they can pay us on the basis of outcome. This needed skillsets coming from analytics, CRM and the like. But unlike specialists, we wanted to roll it all into one and offer end-to-end solutions. We have done this very selectively and have been successful. This may not work across verticals but it requires investment and till we get the model right, it implies investing in the learning curve. But this is value addition and the one big thing I am going to put my energy into, is this.”
AREAS OF FOCUS
Sinha is working closely with a core team of five – Nandini Dias (COO, Lodestar UM), Anamika Mehta (COO, Lodestar UM), Suresh Balakrishna (President - BPN), Premjeet Sodhi (BPN) and Manas Mishra (President - Initiative) – to first understand the brands that he has not worked on such as Initiative and BPN. These executives will work with him to identify the right route for the market. There is a thought towards rebranding Lintas Initiative Outdoor as well, but that again is a decision that will be discussed and finalized in the near future. “My instinct is to be in the larger fold and bring our global OOH brand Rapport to India. But these are only thoughts so far,” says Sinha. Reprise is another brand that will see some aggressive action in India. While Reprise and Lintas Initiative Outdoor will work as standalone P&Ls, the other four areas of focus would be more like functions the profits of which would be given to the relevant media agency.
Sinha has to soon announce the Lodestar UM CEO so that his IPG Mediabrands role is functional in its truest sense. The challenge initially would be to achieve the fine balance between strengthening IPG Mediabrands without diluting the individual brand offer. “In the short run, we have to gain leverage but in the long run, you cannot compromise on the value of the brand and its identity,” he summarizes.
‘I believe in getting people to work together’
Shashi Sinha did not grow up within the agency side of the business. He only moved to Advertising in 1986, to set up the accounts planning function for DraftFCB Ulka. In the early ‘90s, he set up Lodestar Media, leading it from strength to strength, but the real tipping point came in 2004, when he was appointed the CEO of Lodestar UM, the merged entity with Universal McCann. Since then, Sinha ensured that UM stayed amongst the agencies to reckon with in India. For UM globally, India kept becoming not only an important market, but also a market that delivered. Coming full circle earlier this year, Sinha was appointed CEO of IPG Mediabrands, India. Excited with the mandate chalked out for him, Sinha talks to Noor Fathima Warsia and Priyanka Mehra about the future of Mediabrands in India and more.
Q] What are some of the things that you will have to unlearn as you gear up to a much larger role as IPG Mediabrands India CEO?
I enjoy spending time working on clients, so in a manner of speaking, I feel unhappy if I am unable to do this as I used to. There are certain clients for whom I literally get into everything, but now with limited bandwidth, I will have to ruthlessly prioritize where I focus my energy. Unfortunately, I am not a very process-oriented person, so we need to get the right people because in the new avatar, it would be important to have the right processes in place if we intend to harness synergies. The scale of things is much larger now and there would be many aspects I would have to redefine for myself, to better understand how to approach this scale. One big thing I need to remember is that there is no scope for going wrong, I am pretty fast in decision-making, but in quick decisions you can also go wrong.
Q] From the Lodestar Media days to now, how has the journey been?
I never thought we could come this far. We were at the right place at the right time and took many right decisions. Most importantly, we have good teams. Even people like Arpita (Menon) and Apurva (Purohit) who have left have contributed immensely for it to become what it is today. What drives me now is the objective of making this model a success. It is a challenge since this is a number-driven ecosystem, and there are various external factors that will affect the business anyway. At the moment, my focus is on IPG Mediabrands and how we leverage brands such as UM, Initiative and BPN.
Q] Will the agencies be allowed to compete in the same pitch going forward?
It is not an ideal situation, but we will deliberate on this at the combined meeting of the five members of our core team, which will happen soon. Until now, we have competed freely but from now on, I would think there should be one company going and it should utilize our common resources. The tricky part would be defining which agency should go for a pitch!
Q] Why this six-month wait to announce the final game plan for IPG Mediabrands India?
Every decision we take right now would have a role to play in how IPG Mediabrands shapes up in India. The most important area of focus for me has been the people working with us. I am presently building relationships with my core team (Nandini Dias, Anamika Mehta, Manas Mishra, Suresh Balakrishna, Premjeet Sodhi and Anjali Hegde) to build confidence. I have to sell myself to the teams. My philosophy is ‘Play up people’s strengths and work on their weaknesses’. My thought process on this is simple – see if the team is aligned to your values. If yes, then I want to build and strengthen my core team with my values in a talentshort industry.
Q] Do you think you are at a disadvantage since you know two members of the team well and need to know the Lintas Initiative side better?
I don’t know about disadvantage, but it is important for me to know the others as well as I know Nandini and Anamika. Hence I am spending significant time with Suresh, Manas and Premjeet, so that we get used to each other’s comfort levels and working style. I am a great believer in getting people to work together, so I am also looking to build individual relationships at their level. Everyone should get a fair chance. I have not come in with any preconceived notions, but my first priority is to make my core team comfortable with one another.
Q] And what about clients?
I am already meeting a lot of clients. I am very aware that they would have a point of view on these changes. But I look forward to meeting all of them and getting their feedback. As we move forward, some of the approaches taken – both for the businesses and for people – will evolve.
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