GroupM: We expect advertising industry to grow 11.6% in 2014

Written by Lalitha Srinivasan | Updated: Feb 22 2014, 02:39am hrs
GroupM, a leading media investment planning conglomerate in India, is putting in place fresh strategic plans to sustain the firms leadership in the Indian media buying industry. GroupM currently serves as the parent company to WPP media agencies, including Mindshare, Maxus, MEC, MediaCom, and Motivator, in India. At present, GroupM Indias agencies handle media accounts of Hindustan Unilever, PepsiCo India, Vodafone, LOreal India and Mercedes Benz, among others. GroupM India has recently released its ad forecast for the current year. CVL Srinivas, chief executive officer, South Asia, GroupM, says,We estimate a 11.6% growth of advertising in 2014. In an exclusive interview with FEs Lalitha Srinivasan, he talks about the firms growth plans.

What were your key priorities when you took charge as CEO of GroupM India last year

As a key priority, we simplified our organisational structure to bring more focus and accountability, to start with. Over the years, GroupM has scaled up its offerings in digital, content, experiential marketing, analytics and trading. These units, which were earlier referred to as the non-core, have now become the new core of our product, philosophy and strategy. At the heart of the new core is digital.

Another focus area was aligning our talent initiatives with our new core vision. We launched the Y-Co (Youth Executive Committee) to compliment the Exco (Senior leadership team). The Y-Co is a committee of 15 young stars all in their twenties.

How significant is GroupM Indias role in the groups global operations Has GroupM set up any hubs in India to serve global clients

India is one of the key markets for GroupM worldwide, not just because of its size and growth but the fact that a lot of best practices have been coming out of India. We have a few practices in India that work for clients in other markets as well. Meritus, our analytics unit headed by Sunder Muthuraman, is providing cutting-edge solutions to clients across geographies. We have 90 people in Meritus.

Dialogue Factory, our experiential marketing unit, not only works with a range of clients in India, including top FMCG players, but has spread its wings to other Asian markets

What are your inorganic growth plans for GroupM India Are you looking for acquisitions or partner ships

We work with many partners, some of which are joint ventures, some are acquisitions and others are alliances. Going forward, we will continue to explore partnerships that will benefit our clients by improving our product. Will will not acquire just for scale.

How do you plan to sustain your leadership in the Indian media buying industry

While we continue to build on a strong core product of media investment management, we are shifting gears and moving at a much more rapid pace in areas of our new core. We believe that our industry is commoditised to a large extent and agencies need to build tangible differentiators that go beyond regular media planning and buying. Each of the GroupM agencies is today upping the game in terms of their solutions and this is evident from the success all have achieved. We won 82 new clients in the last 12 months. These wins have come across all agencies and offices.

Are you planning to introduce media services from your global company here

We are expanding our presence in mobile marketing, digital content, analytics and experiential marketing in the coming year. Some of these will be driven by external partnerships and others by introducing new products and services.

What are GroupMs cost-cutting measures in India Are you still recruiting

We continue to recruit for key positions across levels, including entry levels, given the growth in our client base and business in the last one year. We are introducing several new staff-welfare measures this year, which we are prioritising over other areas of investment.

What about cost-cutting measures that you are recommending to your clients

Clients are demanding a lot more accountability given the pressures they are under. As business partners, we are engaging with our clients and media partners to ensure hey get better ROI for their investments.

Media firms today face headwinds as advertisers cut back on ad and media budget. How do you plan to tide over this

We estimate a 11.6% growth of advertising in 2014, of which if one were to take away election-related spend, the growth comes down to 9% lower than last years 10%. As an agency network, we are less reliant on core media spends today, given our diversified offerings, especially our strong presence in digital, content, activation, and experiential marketing. We are well poised to face the challenges in the short term and ride wave once the economy is back on track.