Playing the 'India' card: Sons of the soil fight back

By Devina Joshi , afaqs!, Mumbai | In Advertising | November 03, 2010
Over the last few years, several agencies of Indian origin seem to be winning multi-national businesses, often from under the noses of internationally networked agencies. A look at what's cooking in the India pot.

It's a bit like the David-Goliath story.

In a landscape dominated by multinational network agencies until a few years ago, there has been a resurgence of sorts. The new breed of independent, home-grown agencies is winning big battles - read multinational businesses - and contrary to expectations, is posing a challenge to its seemingly unshakeable competition.

Whether it is Creativeland Asia winning Audi in a pitch involving agencies such as BBH; Law & Kenneth clinching the Renault win; Saints & Warriors being awarded Skoda; TapRoot India winning Pepsi's World Cup campaign; or even Black Swan Life becoming the direct marketing AOR for Domino's in India - the new set of small and independent agencies seems to be holding its own against larger networks when it comes to international brands.

Interestingly, many of these agencies came up in the past three to five years and have had humble beginnings - almost on the lines of creative hot shops.

It's not that Indian agencies haven't scored with international clients in the past. Names such as ANC (Alok Nanda Company), VGC (Vyas Giannetti Creative), Triton and Capital (which was later bought over by Publicis Groupe) have always been around and they all have handled large businesses (Indian and international) in the past.

What has changed is that the new breed of independents has managed to corner away many iconic global brands, which till recently was considered to be the forte of only large network agencies. So what is making MNC clients move out of their comfort zone and increasingly try out Indian independents?

Once upon a time in India

Usually, MNC-agency matches are made in the Western world. This relationship was so airtight for as long as one can remember that it was virtually impossible for local shops to penetrate.

As such, 10 years ago, if a marketer was dissatisfied with his network agency in a particular region, he would sit and vent - but not know what to do! Indian independents were rarely seen as an option because their expertise was supposed to be in handling Indian brands. The import of global ideas was much higher then, so a network agency made more sense for international brands.

The formula seems to have lost its rigidness now. Firstly, over the years, global brands have woken up to new economic truths that are India and China. As Anil Nair, chief executive officer and managing partner, Law & Kenneth, puts it, "Just in the way homogenous brand messages don't work across markets, MNCs have realised that traditional relationships made abroad to cater to the West may not work in the Indian market any longer."

While this realisation on the marketers' end has occurred, Indian independents have also made enough efforts to change their image globally. These Indian independents are increasingly positioning themselves as 'globally ready'.

Many of these agencies, such as the Aggi-Paddy run venture TapRoot India, or Raj Kurup founded Creativeland Asia, are much more visible at the international award shows such as Cannes - a sure-shot way to create recall and catch the eye of an MNC client with interests in India. "But while awards do help us get picked up, our work has to speak beyond that and help maintain such relationships, if we are to command any respect," Kurup adds.

Having said that, the fact that the person running his own outfit today has probably done enough time at a network agency and has cartloads of experience of handling global brands in local contexts has also helped change perceptions. Creativeland Asia goes a step further and even has the term 'Asia' in its name to show to the world that it is Asia-focused, and not simply India-focused. All of these help the company's marketing representative in India make a better case to his bosses abroad about hiring a local shop.

There are those who try out Indian independents with a 'let's see what happens' approach, in a bid for experimentation when the brand itself is fairly new in the market. Audi (handled globally by BBH and Grey) is a relatively newer advertiser in India and has gone in for a local shop.

"There isn't too much experimentation happening out of global tie ups and network agencies. We are approached when radical thinking is needed," says Sukumar Menon, founder, Black Swan Life.

Raj Kurup has a different theory - it isn't so much about how long one has stayed in a market; it's about how much autonomy they have in that nation - and who holds the decision making power - the local arm, or the headquarters.

In cases where an MNC brand's networked agency does not have a presence in India, the business might go to a local shop here. Skoda, for instance, is handled by Leagas Delaney globally. However, as this worldwide agency isn't in India, Skoda works with local independents who understand the market.

A small setup comes with its benefits to the international clientele. For one, such a client feels more reassured about the dedication, flexibility and personalised attention provided in a local shop - a bigger network would have 50 such MNC clients and attention gets divided. "For a long time, they might have felt that big agencies don't do justice to them, despite huge spends," says Santosh Padhi aka Paddy, co-founder and chief creative officer, TapRoot India.

This can be punctuated with the following. If a network agency is known by the big guy running it in a region, then this person can't possibly be present for every pitch/client meeting. "This is an advantage for small guys like us because the client knows that every time he comes in, the ones who head the agency will be present personally. This gives him a feeling of familiarity, comfort and reassurance," Paddy adds.

On the flip side

However, not all international brands go the local way. "Any brand that doesn't require brand management on a daily basis will be comfortable with a local shop," muses Suman Srivastava, chief executive officer, Euro RSCG. "For instance, I can't see a telecom or FMCG client working with a boutique for too long. That is because there is so much work to be done on such a brand that boutiques don't have the structure to support it."

There are some other categories of advertisers who are comfortable hiring local shops as their AORs. Creatives for luxury brands, for instance, have always been centralised. Their creatives aren't "touched" by the Indian arm and go directly to the media agency for release. Similarly, some luxury brands might look for independents simply for release work.

Another category which goes well with a local agency is tourism. "Such categories need not require large agencies as they do not need to scale up, unlike big brands," deduces Srivastava.

Besides, today, independents are often given business by international brands on a project basis. However, experts suggest an agency ought to look for a potential marriage partner - and not a 'one night stand'. A project should be a gateway to a long term business acquisition and not just the means to make a quick buck.

Some independents are individuals who end up becoming freelancers for MNCs, which again is a bit of the 'Ek campaign karna hai' trap. Undercutting is another game that some local agencies play to outdo biggies in a pitch. Typically, such alliances don't last long.

However, there are those who propagate another argument: In some deals, the network agency allows its client to use a boutique agency, in case it is unable to crack some marketing problem; and in return, takes a fee cut. A client would obviously be happy with such an arrangement. The truth is probably somewhere in between.

Interestingly, creative boutiques are more expensive than networked agencies - as creative resources are limited, the 'per hour' rates are higher. It is the same thing as visiting a specialist doctor as opposed to a general physician - the former costing more any given day. So, for a client, achieving a big idea on one campaign is the ideal scenario for bringing independents aboard.

Experts agree that the current developments may not signify a complete shift. They indicate inclusion - having independents in the roster, which may translate into the possibility of shifting the business. However, independents would have to work doubly hard to please MNC clients (as opposed to local clients) if that complete shift is to happen anytime soon. And scale could pose a problem here.

"That is also a blessing in disguise: not having scale gives us more scope for experimentation," Menon of Black Swan Life shrugs. "We prefer it this way; that is the structure and functioning of independents."

Pushpinder Singh, founder, Saints & Warriors (in charge of MNC brands such as Danone and Skoda), is realistic when he says that not all independents have made inroads into the MNC client's mindset. "The reason for the poor show of most independents is that they lean too much on one individual, which is perceived, rightly or wrongly, as a risk by multinationals," he states frankly. "Also, a certain process level comfort is much desired by MNCs."

Arvind Sharma, chairperson and chief executive officer, Leo Burnett India, echoes his views somewhat and profiles the three types of clients that have always existed - the ones with very firm global alignments, the ones where global alignments are preferable but not necessarily enforced in all markets, and lastly, those who go by local dictations completely. As he puts it, a lot of MNC clients continue to work with different network agencies across markets, even if there is no global alignment diktat. "Indian agencies tend to pick clients who don't have global alignments with network agencies. There is no rocket science here," he says.

Dev Amritesh, senior vice-president, marketing, Domino's Pizza India (which works with Black Swan Life for direct marketing), offers the client's take. "We don't look at a 'network' as a prerequisite before hiring an agency. We look at the team and the people in it. We prefer evaluating performance over heritage for our final decision." This is clearly in cases where a global diktat is absent.

"For most clients, the most important thing is their own brand's performance in the region," he remarks, adding, "A network agency is more about a global diktat. I think the bigger argument here is small versus large agencies."

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