Hero Puch dumps Euro RSCG for Foresight

By , agencyfaqs! | In | February 04, 2002
Hero Motors has moved its estimated Rs 8-crore Hero Puch account out of Euro RSCG to Foresight, making it the company's seventh agency shift in the last 13 years

It's been barely a year… roughly 11 months. And Hero Motors has once again moved its estimated Rs 8-crore Hero Puch account, this time to Foresight Marketing and Communication. It may be recalled that last year, in March, Euro RSCG's Delhi office had won the account from SSC&B Lintas, following a multi-agency pitch.

The current move in favour of Foresight, however, is not a result of a pitch. Hero Motors apparently got in touch with the agency and asked it to make a presentation on the overall understanding of the Hero Puch range. Having done this, the agency subsequently made a creative-cum-strategy presentation, and pocketed the account.

So what prompted Hero Motors to pull the plug on its 11-month association with Euro RSCG? If the client is to be believed, it was a lack of involvement on Euro's part. "When we gave the business to Euro RSCG last year, they appeared quite excited," says Pankaj Dubey, general manger - marketing and sales, Hero Motors, "In fact, the agency gave up the Kinetic account because it was competing with our business. But, over a period of time, the Euro officials on the account started losing interest in the business. The relations soured to the extent that we felt we were being taken for granted. Therefore, we started looking for another agency. And Foresight happened."

To get Euro's point of view on the episode, agencyfaqs! got in touch with the agency. And this is what Sanjeev Roy, director, Euro RSCG, had to say: "All I have to say is that there are still a lot matters to be ironed out… issues on brands and business to be resolved, before I can speak to the media about what exactly has happened between Euro RSCG and Hero Motors."

Whatever the true story may be, for Euro, the loss isn't really a 'loss', going by what the ad industry says. Hero Motors has a reputation of "flirting with agencies", as an executive from an ex-Hero agency once put it. And one look at Hero's client-agency equation over the years tells its own tale. When Hero Motors launched Hero Puch in 1989, it first hired Mudra Communications as its agency. Two short months later, the business moved to HTA. In 1994, the account was cleaved into mopeds and scooterettes - mopeds went to Percept, while scooterettes went to National Advertising. In 1997, Enterprise Nexus and FS Advertising came into the picture when FS got the moped account, and Enterprise, the scooterette part. Within a year, scooterettes was back with HTA, and TBWA Anthem had mopeds. Then, in 1999, Hero Puch consolidated the two accounts with SSC&B. And last year, the account moved to Euro… Seven shifts and 10 agencies in 13 years!

Dubey stands up for Hero by saying that somehow, the company's experience with large agencies has not been satisfactory. "Their work on the brand starts with a bang and ends with a whimper. The ads spends have not translated into increased sales. But yes, I have to admit that Euro was still better than SSC&B. Maybe, a Rs 8-crore business is small for these big agencies. Therefore, this time, we have decided to go for a small agency. I believe the level of interaction is far greater, and we feel that Foresight will be able to deliver."

For Foresight, which billed Rs 12 crore this financial year (2001-2002), the win is significant. "For us, the product category is very exciting," says Arun Kapur, CEO, Foresight Marketing and Communication. Exciting it doesn't seem to be. The 40,000-units-per-month moped market is shrinking by 33 per cent. And the 23,000-units-per-month scooterette market is actually stagnating. To top it, the Hero Puch brand has done badly this year. So will Foresight be flogging a dead horse? Kapur doesn't think so. "If TVS has been performing despite the slump in the industry, I see hope for Hero Puch too. In no time we will eat into the market share of TVS."

Confidence, bravado, whatever… but the agency seems to mean business. In fact, a national-level multimedia campaign for mopeds is already underway. The television commercial is currently on, and the print campaign will break in two days' time. The emphasis will apparently be on 'strategic advertising'. The ad campaign for scooterettes will soon follow. Incidentally, the Hero Puch account comprises three step-through or moped brands (Power AXL, Power GXL and Shakti), one scooterette brand (EZ), and a recently launched 2-stroke utility vehicle (Power) in the Mokick category. A 4-stroke 'moped-bike hybrid' is also on the anvil. Foresight assures that each Hero product "will get individual attention".

The agency's and the company's primary objective is to make a dent in the southern market - the biggest market for mopeds - where Hero has a weak presence. Naturally, south-based regional channels will be used extensively, while the company's marketing effort will be geared towards increasing the number of dealers in the south from 45 to 80. Simultaneously, the company will aim to strengthen its presence in the northern belt, including Madhya Pradesh and Rajasthan.

Here's hoping that this relationship clocks some distance.© 2002 agencyfaqs!

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