French communications giant Publicis Groupe?s digital company Razorfish finds place in Advertising Age?s A-List top ten of 2013 and is one of the leading interactive marketing and technology companies in the world. Razorfish helps its clients build better brands by delivering business results through customer experiences. The company has 2800 digital professionals, with offices in the UK, Australia Brazil, China, France, Germany, Hong Kong, Japan and the United States. Its clients include Audi, Delta, DHL, McDonald?s, Nike, Samsung and Unilever. Publicis has recently acquired Bangalore based Neev Technologies in order to launch Razorfish into India. In a conversation with FE Brandwagon?s Anushree Chandran, Razorfish?s chief technology officer Raymond Velez and president, Asia Pacific, Vincent Digonnet share their plans on establishing India as a center for excellence for the rest of Asia. Edited excerpts.
What kind of a company is Razorfish? Is it a technology company or is it an advertising company?
Vincent Digonnet: I would like to call it a business transformation agency. It is at the convergence of technology, media and creativity. What we produce is a consumer experience in stores and airports through communication in a more non- traditional way. One example is Audi city near Piccadilly in London, where we created a revolutionary showroom experience for the brand. We created a showroom in a place where you cannot have cars and through surfaces, generated the experience of a car without the car being present. Another example is the work we did for Kellogg?s. We took the brand which offers cereals and offered services on how to monitor weight and diet with an application. I think that we have a difference in positioning. We are about selling services, not selling problems. When we were a part of Microsoft, it was mostly about ad serving. We were bought by Publicis Groupe and then marketing came into it. We went from being a sheer technology company to a marketing company. This is how we are different from other Publicis companies such as Digitas. Digitas is a marketing services company that became digital, as the world of direct marketing and communication became digital. We are a technology company that entered marketing as technology started to improve and transform the marketing business. Razorfish is now launching in a big way in India through a combination of acquisition and organic growth. We are going to spin off some of the people from Digitas in order to launch in a very big way in India.
Why has Razorfish taken such a long time to come to India?
RayMOND Velez: That?s one question that people ask us all the time. But to be fair, we are not late. Razorfish has global brands and they?ve been executing in India and we?ve been part of it. Being part of the Publicis Groupe already gives us a leg-up and a network of connections across our sister agencies to deliver here. Between organic and acquisitions, we are going to have a huge presence here and India is going to be a pivotal piece in the Razorfish network. We are going to have 300-plus people for the Indian market with the acquisition. Razorfish India will act as a hub for Asia and in time, possibly Europe and the US.
Digonnet: The difference, I suppose, between a marketing led organisation and a technology led organisation is that you can start an agency with a few people and grow it organically when your core business is just marketing. But when you are at the convergence of technology, media and creativity, things are slightly different. When technology is the lynchpin, you cannot launch the brand unless you have the technological capability of developing what you are talking about. We could not launch in India unless we had a solid technological backbone to launch it on. Now we have that. Razorfish is very strong in China. In Japan, we are present through a joint venture with Dentsu. Australia serves as a worldwide excellence centre for Razorfish. We could not have had a formal launch earlier in India, because India was not digitised then. It was late in embracing digital technologies, in comparison to, say, China. But we believe India is at a tipping point now. There will be huge developments on the back of technology in advertising, marketing and trade.
Who are your competitors?
Velez: There are two ways in which competition is coming at us. There?s traditional advertising competition and then technology companies – guys who write software. I have folks in Razorfish who don?t consider themselves as advertising people. They don?t like it when we call them an ad agency. Gartner has predicted that by 2017, the marketing organisation is going to own more of the IT budget than the CIO (chief information officer) and the CTO (chief technological officer). So the guys who have been selling their services to the CIO and the CTO will eventually start selling to the CMO and the marketing organisations. One competitor that I look up to is SapientNitro. They are coming at us from the tech side. They are more like us and have a big presence in India. The Nitro part of it brings them the advertising piece. But I don?t think that they are moving very quickly in order to put the consumer at the centre. That?s the problem with technology teams and enterprise IT.
Digonnet: I don?t think that many of the traditional advertising agencies qualify as competition. If you look at China, my biggest competitor is not an advertising company, but Accenture. The commerce part of marketing is growing tremendously and is breaking down the barriers between communications, trade, sales and social media. And all of a sudden, it?s more complex than running a campaign. It?s about platform development, systems integration, warehousing, logistics ? it?s a whole new world. Accenture puts out all this capability that we do, but what they are lacking is the consumer experience and the marketing experience that we have. The way we are structured, we are a couple of years ahead of the market.
In India, what?s your competition like?
Digonnet: I can confidently say that we don?t have competition in the Indian market. I have been in and out of here for 15 years now. I have seen the development of ad agencies. Most digital agencies in India are basically ad agencies online. But this is not where the market is going. This is not about advertising anymore. It?s not about creating banners. You need a merger of media, technology and creativity and there is no company here that has that mix. You have yet to change the goalpost.
Velez: If you are shooting at metrics that?s part of the old world, then you are not going to be part of the new world?are you?
Do you think metrics is the reason that many of us are stuck in the old world?
Velez: Absolutely. If you are not measuring how people are talking about their brand, you are missing out. There?s a technology in the US from a company called Bluefin. What Bluefin does is– it aligns the time of the programme, when the commercials are aired and then examines that in relation to activity on Twitter and Facebook. And from that, it can get information on what net promoter scores they are achieving and what is the sentiment about the brand. The old metric of Nielsen in the US?as to how many people saw the commercial ? that?s ineffective without understanding how people are talking about the brand or the programme.
Is it true that the digital business has been insulated from the slowdown?
Velez: We certainly saw things in digital which did not slow down.. The growth of e-commerce globally has not stopped. So this is a brand experience you should be shifting money to, because it helps actually grow your business. Retail across the world is changing. This could also happen in India, but your distribution system is still mom-and-pop stores, which is only now moving to larger retail formats. In the US, all of the retailers and organisations which have to compete with Amazon are afraid of Amazon because it has introduced a new offering that?s driving closer and closer to same day shipping. But then Google just announced a new capability and there are a couple of very interesting start-ups in the same area which allow consumers to connect with their local store. And then get the same day delivery from the local store. What?s a better distribution network than the store down the street? That will help save retail. If these small retailers understand that they have to come together. They have to have a digital commerce experience. That is what they are going to be forced into. You see that pressure very strong in the US and it will be the same in India.