At a conclave titled 'The Change That Cometh', The Free Press Journal addressed India's small-sized advertising agencies. Sam Balsara, chairman and managing director, Madison World, Punitha Arumugam, director, agency business, Google India and Bharat Kapadia, founder, firstname.lastname@example.org, addressed the audience, comprising owners of these very small agencies.
Madison's Balsara made a presentation titled 'How to make the leap to the next level?' He shared tips on how small agencies can scale up and take their businesses to the next level of success.
Balsara started with some facts. Advertising, he noted, is a booming business in India and though the current year may not have been that great for the industry, prospects certainly are. This is true for India, especially because it is a growing economy and advertising, as a percentage of the country's GNP, is still only 0.35 per cent; this is significant because the global average is 8 per cent. Thus, as India westernises and modernises, the industry will grow for sure.
He then went on to speak about some of the winning strategies that small-sized agency heads can apply. According to him, an entrepreneur always implements a mix of strategy and intuition in order to succeed. Giving the example of Madison, Balsara said that contrary to popular belief, it is important to think small. In order to beat the biggies, he explained, "One must think small and focus on the next step."
Also, he reminded the audience that it is not possible to be the agency of choice for every client out there. "Remember that you can be the agency of choice only for some advertisers," he said.
He advised against getting bogged down by the thought of other big agencies and suggested, "Rather, focus on what you can do for your client. That's what I mean by 'think small'."
Balsara then shared his favourite definition of 'advertising', one by Stephen Leacock: Advertising is the science of arresting the human intelligence long enough to get money from it. In light of this definition, Balsara urged small-sized agencies to focus on developing core competences in advertising. "An agency grows if it creates advertising that makes its clients grow," he said.
Drawing inspiration from Al Ries and Laura Ries' book, 'The 22 Immutable Laws of Branding', Balsara shared what he calls 'The 10 Laws of Madison'. Each law is basically a lesson for small agency heads that can help them grow and prosper like Madison has over the years.
The first law, he said, is the Law of Disadvantage. "It is an advantage to know that because you are small you are at a disadvantage when it comes to pitching against big agencies," Balsara explained, adding, "This will ensure you never get complacent and work that much harder than a big agency."
The second law is the Law of Service. As per this law, an agency must service its clients well enough for them to stay loyal to the agency for years. This, he added, is a reassuring factor for new clients, too. "As you grow bigger, don't stop working the way you did when you were small. Keep working as hard as you did when you started," he said. Balsara cautioned against getting alarmed in the face of diminishing 'percentage profitability' and urged small agencies to keep an eye on their 'absolute profitability' instead. As long as the latter grows, one shouldn't worry too much even if the former falls, he said.
The third law is the Law of Technology, Resource and Data. All these, according to Balsara, are 'enablers' in the agency business. The fourth and fifth laws are the Laws of Specialisation and Focus, respectively. While the former points towards the benefits of separate media channels, the latter urges agency owners to have one core competency and stick to it.
The next law is the Law of Organisation Building. Indian entrepreneurial ventures, Balsara opined, are not as good as western ones when it comes to this, because they tend to be too individual-led and owner-led, rather than process-led. It is crucial for any organisation to focus on scaling up without the entrepreneur's personal involvement, said Balsara.
The other laws are the Law of Conservation, the Law of Perception and the Law of Patience. About the last one, Balsara said, "Remember that success doesn't come overnight."