We want to be India’s own WPP.

Shailendra Singh might be the perfect example of living life to the fullest. His sprawling office is an extension of his flamboyant personality. At the same time, he treats business associations like human relationships and cherishes each one of them.

Percept Holdings has been launching a new initiative almost every week of late, and this has had the whole industry sit up and take notice. Singh loves all the action and attention. He believes that to be successful, one has to let go. When not overseeing the company’s many divisions, Singh indulges in sports. In a chat with Prajjal Saha and Sapna Nair of agencyfaqs!, Singh talks candidly about failed business relationships, and the strengths and weaknesses of his company. Shailendra Singh, joint managing director, Percept Holdings, in the spotlight.

Edited Excerpts

Our aim is to be India’s largest communications, media and entertainment company. Currently, communications has been a large platform for us, but in times to come, the proportion will tilt towards media and entertainment as the profit margins are extremely competitive in the communications portfolio. This is why media and entertainment become really significant for us in the growing economy.

Percept venturing into different segments has been fuelled by our clients’ requirements. For instance, if an existing client of our creative agency needs a below the line service, we would launch one ourselves instead of outsourcing the product offering. Similarly, whenever a client has needed other services within the communication space, we have launched it, be it celebrity management, content creation or ad film production.

But in the course of expansion, we made sure we did not lose our core competence, which is in the communication, media and entertainment space. We are presumed to be an aggressive group now because the domains that we are present in are all in a hyper space, be it media, sports management or celebrity management.

But the fact is that we have been in the celebrity endorsement space for the last 10 years; in the sports marketing space, we started off 14 years ago. Today, Percept Holding as a group has around 640 clients, whom all our divisions have access to. Moreover, today, clients look forward to one-window interaction for all their needs rather than deal with 10 different agencies, and this is working for us.

Your point is bang on. For the last three years, we have advocated that companies within our group must present only individual profiles. We keep the prime introduction as short as two minutes to brief clients about the group. Those two minutes allow the client to understand what the group is capable of, but does not hard sell the offering. We don’t strategically offer all of our services to our media clients or advertising clients.

The good part is that we have worked hard in the last couple of years and, quite honestly, courtesy the individual brands, be it PPC, PDM or P9, all have found their individual glory. Now, the tide is turning and the clients are demanding services from us.

Let me give you a very honest and mean answer to that. We strongly believe that anyone can fight us individually in the respective domains, but collectively, no one can. For instance, Wizcraft can compete with us in the entertainment domain the same way IMG can in the sports domain. But collectively, who can fight Percept D’Mark?

From the outside, it may look like there’s a lot of activity happening, but there is also a lot of method in the madness.

We have discussed this often. We believe that when you want to grow, you let go. When you are grown, you bring it back. We are just about growing now. We have to reach a certain stage before we consolidate. Sometimes, one has to demolish everything one has created to grow further. That’s the harsh reality of business.

To be specific, we are still two years away from that stage. Right now, we are going crazy with so many initiatives, so we have to let go.

In fact, we have acquired another agency now called By Design and we have merged it with Imageads.

Every agency in our group has a unique identity. While AMO was supposed to be a creative-led boutique, Imageads specialises in dealing with public sector clients. Creating these niche services within the space was an effort to gain momentum. It would have taken 10 years for Percept H alone to do that.

Strategically, one day, we may combine all of them together to create critical mass.

Why not? Of course, we are. Fortunately, then somebody will export something out of India, unlike the trend in the past. That’s our vision; we will be India’s own WPP. If you study it, WPP has grown through acquisitions, while we have both created as well as acquired. There’s a huge difference between both these models. Like we created PDM as India’s IMG, and that too with their help.

Actually, when we launched PDM, we approached IMG and offered them a stake at par because we thought they knew the job better than us. But they refused. Then when we thought, we will create our own IMG in India with PDM, we outsourced most of our works to IMG and they helped us.

That’s both true and untrue. Harinder (Singh) and I are super confident individuals. And we have the same confidence in our professionals. But the issue is much larger.

As Indians, we have everything, be it technology or knowhow, but we are also emotional and at times bound by our culture and history. I will give a small example.

There is this ice cream brand in Mumbai called Naturals, which is unique in itself as it is a totally chemical free brand in a world that is full of synthetic products. But the irony is that though it has immense potential to grow, Naturals has only four outlets in Mumbai, while the other international brands are spread across the country with close to a hundred outlets. So, it’s all in the mindset.

Our out partnerships till date have been strategic. In the advertising space, we partnered with Hakuhudo because it had certain tools and a knowledge base that we needed. Besides, it is Japan’s number two agency and the world’s number six. And the truth is that we don’t have its expanse and we aren’t the world’s number six.

We will continue to partner with people. And, of course, our recent relationship with Lachlan Murdoch, which is a cause for great pride. He brings with him extensive knowledge and contacts.

The idea was that we wanted to partner Hakuhodo in all the advertising work we do in this country, whether it is one or 10 agencies. Hakuhudo Percept was there to target Japanese clients in India, while Percept H is supposed to service domestic clients. There is great synergy between the two agencies. Our partnership with Hakuhudo will continue and is here to stay. There’s a strategic fit of minds also, other than talents and business here.

It’s because we believe in buying into relationships rather than balance sheets. We strongly believe that it is people who take businesses far and forward. And our job is to share the vision and provide finances.

So, we try to build relationships with people in the industry. While, on one hand, we had full faith in Shripad that he could deliver, on the other, he liked the idea that he had the backing of a large organisation. And the relationship worked.

We were going through a transition. And it wasn’t fair at that time to let the client suffer, when we ourselves were in a fragile state. We will win back that business. Today, we have the size, scale and professionals; I can guarantee on record that we will win that business back. I am not going to let it go. In the next one year, we will be among the top five media and entertainment companies in India, we are super confident about it.

All our partnerships have been strategic, and whenever it hasn’t been so, we have paid them the money and bid them goodbye. Aegis was one such example. There was no value addition coming from Aegis. We liked the people there, but there were just so many changes in the management at Aegis, and Carat over the years, that Percept couldn’t get any value addition other than the money. The graph of growth was not steady and wasn’t contributing to the growth of the industry at large.

We thought we could lean on them to take PDM global. But nothing like that happened. Neither of us was gaining anything from the venture. We waited patiently for more than five years before deciding that there was no strategic fit there.

Of course! Web Percept is nobody’s brand. We wouldn’t want to comment on what Amit did in his capacity. The brand cannot be used by either party. We are launching our own brand in this space very soon. We are just putting the team in place. Web Percept, the brand, has been dissolved. We are entitled to use it after a year, but it doesn’t make sense for us to do so.

We have a couple of common friends who got us together. Traditionally, we believe in friendship first and business after that, because in business, things can go wrong. We have had a great relationship with him (Lachlan) and he realised that our group was fantastic, had the right ingredients and was growing.

Right now, PPC is of keen interest to both parties. And, of course, we can look at other things that we can do together for sure. This is definitely not the end of the road.

About broadcasting, we have been great broadcasting managers. We ran SaharaOne for some time and have experience of the broadcast business. First of all, I don’t think that the broadcasting business is a very paying industry. If you see the numbers, this industry will lose about Rs 400-800 crore this year. He may be keen to do it, but right now, we aren’t ready for it.

Harry and I are not keen to own a broadcasting business. Our plate is full right now. However, we would love to manage it, provide strategic inputs, content and such things. We will contribute to his vision for sure if he wishes to take a plunge in it.

It was always a client relationship. At one stage of his life, Subroto Roy felt that we were competent and suggested to us that we take over the network. The first objective he wanted us to achieve was to create an image to suit the upwardly mobile youth. He wanted us to run his broadcasting business for a while, as at that time, they were busy with the airline and real estate projects.

Our relationship dates back 13 years. We took it up for reasons best known to us. Those 18-20 months taught us how to run a broadcasting business. Here, on somebody else’s resources, we were to effectively contribute to his business and learn the business.

The journey was good. Roy achieved the image that he wanted to from SaharaOne. But we had to leave it there because I was getting labeled as the CEO of SaharaOne, when Shantonu Aditya was the CEO. I was also losing ground on Percept; my clients were running away thinking I had lost my focus. But that period was worth it because Roy’s business gained and we gained knowledge.

I think it has got to do with scaling. The focus of Sahara as a corporate is not to dominate the media and entertainment space, but to better what they are doing. This business is like a tap, money flows like water, and the gestation period can be as long as 10-15 years.

One has to have that vision in broadcasting. So, the task given to us or them is to dominate the business, but is actually to package it better and run it efficiently.

I was ambitious enough to launch Filmy. Next in the list was a music channel called Hit. There was an entire plan of launching seven channels in the bouquet because that was the only way we could have leveraged the market. One can’t do it with a two channel network – it’s a big game now. It is not easy to succeed in the general entertainment space without a network. Media and entertainment is not the prime focus for them. It has a lot to do with how a promoter wants to plan his business.

The entertainment business will be crucial and fuel growth. Advertising will always be a challenge. The margins are very tight there. But that’s our core business, and we will do all that we can for it. But the focus, as I said, will be media and entertainment because that’s where the numbers are and where the excitement is.

If you see the chart of PPC, we make films for all audiences. There’s a reason behind it. In 2010, I want the entire family (kid, dad, grandfather) to say that it’s a PPC film.

I want to evoke this trust among the audience. So, we have made films for kids and adults, social films, animation movies, movies for villagers, middle-class audiences, the rich, and corporates. We are careful that we do not make violent movies because the acceptance level is still very low in India. Strategically, we focus on all audiences. ‘Spiderman 3’ was a strategic move. We could have taken a ‘Harry Potter’ or a ‘Casino Royale’, but we did not. While the former is known to be a movie for kids, the latter is tagged as an adult male movie. ‘Spiderman’ is for the family.

We have virtually tackled all verticals, despite the fact that the size of each vertical varies significantly. For instance, the size of the thriller movie genre is extremely small. So, one has to consider the size of the segment before putting in the money. What’s the point in spending so much in such dodgy areas? We might get into fragmenting in the future, but not before we build that notion around PPC.

You work in a fee system or on a commission basis and the cash component is increasing gradually. There are intelligent people in the in-film placement business now, whereas in the past, people indulged in it as a trading transaction. They just picked a client and put them in the film. An example was ‘Taal’, which was a disaster tie-up!

Now, clients and agencies see a logical and psychological fit of brands for the consumer. They understand the value and are willing to pay the cash component. There can also be a barter, where there’s a clear understanding that P9 or whichever agency charges a flat fee on the transaction, to service the transaction. P9 has evolved into a fantastic creative shop, which does media buying for brands and syndication and barter with producers, monetising both platforms to a great extent. It is a large business and will only grow in the future because India is still a two-platform country: cricket and Bollywood.

Most of the advertising and PR companies of Percept are in a domain where the work speaks for itself. I don’t think we are media shy. By default, PTM, PPC and PDM are in domains which are more glamorous and, hence, you will find them more in the news more often. Everything else pales in comparison, I guess. But we are definitely making a concerted effort to reach out to all our journalist friends and keep them updated on what we are doing at Percept!

The Bollywood Theme Park will provide a totally novel experience for a visitor. It’s a concept that we have been contemplating and planning for quite some time and we feel we are now in a position to get into this arena. Bollywood accounts for more than 40 per cent of the total revenues of the overall Indian film industry. Bollywood is what the Indian masses turn to for entertainment, but there is no organised format or means to consume this experience. This is an opportunity for the Indian audiences to live and breathe Bollywood under one roof!

The Bollywood experience will aim to provide Bollywood cafes, walk-throughs, a hall of fame, Bollywood museums, Bollywood rides, sets, shoot tickets, Bollywood tours, memorabilia, lounge, events arena, simulator experiences, 3D virtual gaming booths, merchandising and a host of other experiential offerings for visitors in what will be 1,00,000-1,50,000 square feet of pure unadulterated infotainment related to Bollywood.

The project envisages the first such model to be set up in Mumbai, followed by a roll-out on a national and global scale. Bollywood Corporation Pvt. Ltd has already been registered by Percept Holdings and Percept is currently in the process of acquiring space in Central/North Mumbai. The blueprint and concept plan for the Bollywood theme park is also in place.

The core management team and strategic partners and vendors have been identified and will be announced in due course. The initial investments could be somewhere in the range of US$ 100-200 million. A professional global consulting agency will be employed as a process partner to oversee the entire process.