Indian digital agencies are dreaming of Arabian Nights; Here’s why

TSBI, Zoo Media, iCubesWire, and LS Digital are just a few of the many Indian digital agencies that have expanded their presence into the MENA (Middle East and North Africa) market.

Business and trade relations between India, the UAE, and Saudi Arabia have always been great, however, India’s ad tech capabilities are now also navigating the Middle Eastern markets. The MENA market is currently becoming an investment hub for global companies, which in turn means the advertising market is also actively growing. According to the World Advertising Research Center (WARC), the Middle East’s advertising market is on track to be the fastest-growing over the next two years, driven primarily by Saudi Arabia and the UAE.  

According to the report, the market’s ad spends increased by 10% in 2023 are further expected to grow by 6.2% in 2024 to reach $6.9 billion. The ad spend in 2022 stood at $5.9 billion vs $6.4 billion in 2023.

But why UAE and Saudi Arabia?

According to Harikrishnan Pillai and Manish Solanki, founders of TheSmallBigIdea, who recently opened offices in Dubai, the Kingdom of Saudi Arabia and the UAE contribute at least 70% upwards of the total ad spends in the MENA region.

They say that even though it is the 17th largest advertising market, the speed at which it is picking up is huge and that is where all the opportunities lie. The GCC countries, and more specifically, Dubai are becoming a global hub, because of which, the requirements in that market are very different. The market is looking at agencies that not only have an understanding of the Arab world but also have a global perspective. This becomes a great opportunity for agencies and especially digital agencies.

How do Indian agencies stand to benefit?

According to an Interactive Advertising Bureau MENA (IAB) report, digital ad spending in the MENA region grew 20.1% in 2022 and reached $5.5 US billion.

As per industry leaders, what makes Indian digital agencies an appropriate partner for brands looking to tap into this market is that Indian agencies come with experience, technology, and scale.

Pratik Gupta, co-founder of Zoo Media, which has also recently tapped into the MENA market, states that Indian digital agencies are equipped to work with billions of mobile internet users across demographics and boundaries. 

“The entire population in the UAE must be 5-7 million people, which isn't even our smallest media plan. The fact is that we have such complex audience sets and have already done the innovations. We were equipped with great digital infrastructures and have solved far more complex briefs. So for us, brands pay us better, and the scale of briefs coming in are much simpler. This is why many agencies want to go into the Middle East,” he explains.

Adding to this, Rupak Ved, chief operating officer, LS Digital, says the MENA market has increased its investments in technology and AI. “The market is evolving itself and is becoming an innovation centre.

“From the Governments to the brands, investments are happening not only in marketing here but also in marketing technologies. India, having the technological and digital capabilities and having worked with global brands, becomes a good stepping stone for agencies having international aspirations,” he explains.

Pillai of TSBI further adds that the brands and the market require speed along with creativity, and Indian digital agencies can offer this at the right price.

Talent, culture, and hiring

The cities in this market, being cosmopolitan and global, require the same kind of talent hiring. Indian agencies that are opening up offices in the MENA market are drawing a careful balance between the local talent to help with local insights and the global talent. While some agencies prefer establishing a strong base locally, others are relying on collaborations and outsourcing as well.

LS Digital, which will complete its third year in the market in 2024, says it has a very inclusive and multicultural team in the UAE. “We have people from UAE, Morocco, Lebanon, India, Africa, etc in the team. This helps us get multi-layered opinions and outlooks," says Ved.

He further adds that while the team is small, they are serving more than 15 clients in the market. “The region’s proximity helps. While we are sitting in India, we can fly to meetings in about 2-3 hours. The fact is that the skill sets required to run a digital business remain the same, it's about having the flavour of the local market which we are getting through our people there,” he explains.

TSBI is also drawing a careful balance between expats and locals. “You need to invest in having talent and experts there. You must understand the culture and where they are going. We recently went for a pitch and an Indian agency showcased creatives that would be great in the Indian market for an entertainment brand but not so much in the Middle East. You could see the locals frown because it was very far from the culture there,” he explains. 

Navigating competition and business Goals

With the Middle East emerging as a dynamic investment hub, fueled by increasing ad spends and technological advancements, Indian digital agencies are strategically positioning themselves to capitalise on the burgeoning opportunities.

However, the landscape continues to be highly competitive. In addition to competing amongst themselves, these agencies are navigating the competitive landscape alongside well-established traditional creative giants already present in the market.

“A majority of marketing and advertising for all brands in the Middle East are run by Indians. The cultural exchange over there is massive so they also like to work with Indian agencies. There's a lot of scope to grow in that market for sure. Will it get competitive? Yeah, but if you do great work, competition is not the metric,” explains Gupta of Zoo Media.

This is why agencies are looking at growing slowly and organically. For example, after three years, MENA comprises 2-3% of LS Digital’s overall business as a group,” says Ved.

Similarly, TSBI who says their expansion is an additional aspiration expects the MENA region to be 10% of the top line. “This should grow by 5% every year. In another 5 years, we want this to be 30% of our topline,” states Solanki.