While most of us had a lazy Sunday, top guns of select advertising agencies were pitching hard for the Rs 100 crore creative-media buying-public relations account of Life Insurance Corporation of India.
According to sources in the know of things, more than 40 ad agencies had pitched for LIC's advertising account. It was hardly surprising as LIC, with an ad budget of Rs 100 crore for 2004-05, is the second largest public sector ad account in the country. Only Indian Oil Corporation's ad budget exceeds this figure.
On the creative side, the short-listed agencies which were invited to make presentations to the LIC top brass were JWT, Mudra, RK Swamy/BBDO, Redifussion Y&R and Pressman. Some of these - RK Swamy/BBDO and Mudra - are currently empanelled with LIC.
The reason for inviting the pitch is pretty simple: LIC has had enough dealing with some 45 agencies across India for more than a decade. Both Deloitte & Touche, and Booz, Allen & Hamilton - LIC's current and former consultants - had recommended the dropping of a plethora of agencies and sign up only a few. This time, the insurance monolith wants to sign up just four agencies for its countrywide operations.
On the media-buying side, agencies which were invited - included: GroupM, Carat-Percept and Initiative. For the uninitiated, Carat-Percept is the joint venture between Carat and Percept Communications; the latter handled some of LIC's media-buying operations. Initiative is, of course, part of the Lowe group.
For the public relations part of the business, three agencies were shortlisted and subsequently invited for the pitch. These were Perfect Relations, Adfactors and O&M PR.
What's interesting that certain well-known names in the advertising fraternity did not figure in LIC's scheme of things. Some, of course, had their reasons. For example, O&M and Lowe had to opt out of the race since they handle competition in the form of SBI Life Insurance and ICICI Prudential, respectively. Others must have got waylaid by LIC's 'barriers'.
Sources said LIC had put certain clauses to keep second-rung agencies at bay. One of the criteria to get short-listed was agencies must have a gross income of over Rs 25 crore. Additionally, LIC specified that such agencies must have dealings with large corporations with an all-India network and also have in-house facilities to make creatives. Further, prospective agencies must have a minimum 10 per cent of their billings from the PSU sector. According to sources, another reason for putting these pre-conditions was to keep the selection process above-board and free from political manoeuvres.
Meanwhile, LIC is serious about improving its image through communications. LIC executive director (PR & publicity) A K Shukla was recently quoted as saying: "We should move on from promoting just the brand to product branding. Customers should identify the product with LIC."
LIC's move to call for a pitch was also on account of its unhappiness with the current flock of agencies. A senior LIC executive said, quite a few of the agencies have been on the pay-roll for more than 15 years now. Unfortunately, their work have either become "stale" or "politely arrogant" out of either complacency, or, lack of motivation, he added.
There's also a feeling within LIC that the corporation must follow the global example of having two to three agencies on its panel. Campaigns, the LIC top management feels, can be better managed and agencies, therefore, be more accountable as they work as partners with the organisation.
Apart from LIC and IOC, some of the biggest PSU accounts are that of State Bank of India (ad budget of Rs 65-70 crore), Unit Trust of India (Rs 30 crore), Hindustan Petroleum Corporation and Bharat Petroleum Corporation (Rs 50-60 crore each). © 2004 agencyfaqs!