Interview: Dheeraj Sinha, CEO and CSO, Leo Burnett, South Asia

By: |
July 16, 2021 6:42 AM

‘Fragmentation of agencies has not helped marketers’

Over the past year, we have trained about 450 staffers on various aspects of the digital medium, says SinhaOver the past year, we have trained about 450 staffers on various aspects of the digital medium, says Sinha

Leo Burnett managed to stay afloat in 2020 by winning new businesses, even as existing clients tightened their purse strings. Dheeraj Sinha talks to Venkata Susmita Biswas about restructuring the agency to beat the pandemic blues, the benefits of a hybrid agency model, and leveraging audio for advertising.

How severely did the pandemic dent your revenues?

Our business was badly hit in 2020. Several clients lowered their fee and put projects on hold. However, we compensated that loss by winning new businesses — we won 20 last year. We were only about 5-6% short of our 2019 revenue in 2020, because of which we did not have to let anyone go during the pandemic. In fact, we have been able to give increments and bonuses this year. In 2021, the performance in the first half has been good. We have our fingers crossed about the rest of the year, and are hoping to exceed our 2019 numbers.

Most of your new business wins seem to be integrated mandates. How did that come about?

The fragmentation of agencies that has led to the creation of agencies for social media, digital, influencers, mainline advertising, etc, has not done any good to marketers. Marketers have become the integrators, trying to get multiple agencies to talk to each other. This has created a need gap in the market. Therefore, our ability to deliver a full-funnel solution with a specialisation at every step of the funnel is making us win accounts.

Clients prefer this hybrid model. The issue is that, while a mainline agency may masquerade as a digital agency, they do not have the specialisation and the skill set to deliver such a specific solution. Over the past year, we have trained about 450 staffers on various aspects of the digital medium. We are rolling out a course on behaviour economics for our leaders. We have tied up with platform partners like Facebook, Google, Twitter, and IVM Podcasts, to offer training.

Turning objectives into programmes has helped us. We spend time coming up with format-specific concepts that can be presented to clients. For instance, we have a platform week coming up this month. During this time, we will brainstorm several platform-based ideas that can be taken to clients for execution.

What, then, was the idea behind launching three separate divisions — design, consult and digital — last year?

Classically, agencies have been built by creating silos. Having seen that model play out across multiple agencies and across my career, I do not wish to make those mistakes. We are building one structure and making horizontal specialisations. So, it is the same team that has expertise across different areas. We have a node of specialists that is powering the team.

What are your thoughts on project-based work for brands? Is this trend picking up?

The bulk of our revenue comes from mainline advertising, where we build big brands and execute TV and print campaigns. A significant chunk of that business is also project-based. In fact, a good 20-30% of our revenue comes from projects. We are open to this kind of work. I prefer to call these project-based relationships, where a client returns to us for more projects after the first one.

This model works for those with specific requirements that don’t span the whole year. Naturally, the pricing for a short-term intervention is higher than that of a long-term retainer due to economies of scale. We do advise some of our clients that, perhaps, they will not get the maximum benefit by putting us on retainer. Instead, we could do a concentrated six-month project and re-engage when they need us again.

Audio content became popular during the pandemic. You, too, are hosting a podcast on IVM Podcasts. But are the ad dollars coming in?

I felt that if I must evangelise this format, I must learn about it by hosting one myself. It is early days for podcasts in India; however, there is ad money flowing into this format. For instance, finance brands are sponsoring or getting involved in the creation of podcasts. While advertising is not taking place on a big scale, the rate at which interest is increasing is surely promising. We have two clients with whom we are actively exploring podcast-based solutions. In the future, I expect podcasts to be applicable to brands across categories, and not be limited to finance brands.

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