From an incoming gloom, to Indian companies going bullish, to whether purpose is a sin; a year-ender chat with FCB Group India’s chairman and CEO.
Nestled inconspicuously in Andheri, an annoyingly loud suburb in Mumbai, is advertising giant FCB Group India’s headquarters. It is a glass-enveloped monolith, like many in the vicinity, that keeps its agencies and their creatives, strategists, servicing folks, etc., insulated from the surrounding chaos, as they dole out ad copy and communication plans for the group’s clientele.
Interpublic Group (IPG), FCB Group India’s parent, on the other hand, mirrors the hassled suburb these days. Just when many global technology giants laid off employees, quicker than a seasoned chef dices a plate of onions, and a recession was on the horizon, IPG ditched the expected corporate conservatism and made a bold statement.
“Despite heightened macroeconomic and geopolitical uncertainty, we are upgrading our expectation for organic growth for the full year to 7%...,” it said in its Q3 earnings conference call on October 21, 2022.
Many believe that unlike the west, India will not be that much impacted by the recession (expected in 2023). A contrarian's fingers point to a rapidly bubbling stream of Indian startups, some being the biggest advertisers of the country over the past couple of years, scaling down their marketing and ad spends, and laying off hundreds and thousands of employees.
They (the fingers) are, instead, redirected to these certain ‘younglings’ who quickly hired folks, expecting a post-COVID growth boom and more importantly, their investors who are now feeling the pinch because of a host of macroeconomic factors. But the world managed to digest its consumption appetite a lot earlier than expected. The startup squeeze isn’t a reflection of the whole Indian economy.
Doom and gloom
An advertising drought is worrying, especially for ad agencies. Many of them have grown to depend on these startups for a good part of their bread and butter.
Not Rohit Ohri, though.
Dressed in easy formal wear and looking at me with his adland-weary mind, the chairman and CEO of FCB Group India is quite confident and hopeful about the coming year. Well, he’s cautiously optimistic.
He agrees that India isn’t completely immune from the rapidly approaching economic uncertainty. He believes that bullish Indian companies can grab the market space, at a time when global multinationals are being more cautious about their spending.
“India may be a big market for multinationals, but it becomes a small 3%-4% of the global turnover, when you convert the share into US dollars. People don’t want to make exceptions, keeping future growth in mind. So, they put a one-size-fits-all mandate on cutbacks. That becomes a big challenge for global multinationals in India.”
Ohri knows this better than most because, unlike his group’s rivals, FCB Group India counts many Indian companies, such as Tata Motors, Max Life Insurance, Navneet and Amul, as its clients, and “in our portfolio of clients, we don’t have that many startups.”
He reveals that they’ve “been a bit cautious about working with startups, because many want to work on a project basis.” Cautious doesn’t equal unwilling. Project work, for FCB Group India, works because “it is a defined scope of work in a defined revenue and there’s no risk.”
What the group prefers - the good old retainer - is missing in most agencies’ relationships with startups. “They (the startups) think project out and out, there is no point persuading them to do long-term,” states Ohri.
FCB Group India, however, did go on to become smartphone giant vivo’s agency of record which, till some time ago, only indulged in project work.
New Year resolution
All businesses relook at their strategies right before the start of the year. If 2022 started with cautious optimism, before exploding into unfettered consumerism for many, 2023 could mean seeing companies go back to the basics.
FCB Group India, states Ohri, will focus on “organic growth” in 2023. “We are chasing new business with our existing clients and that, I think, is a deeper, more potent strategy.” He cites Tata Motors as an example. The group handled the carmaker’s passenger vehicles account and, now, takes care of its electric vehicle account as well.
New Year, new you?
Agencies have lost good employees to not only the likes of content agencies, OTTs and start-ups, but also the very people the agencies service - clients. With the influx of talent from ad agencies, the traditional client must speak about what to do and ask the agency to do it because they know, sometimes more the agency, on what is the best course of action.
Ohri doesn’t buy this thought, though. For him, the “agency is a potent partner, because it intersects with the (Indian) consumer on many different categories and, therefore, has a deep understanding of him/her.”
Speaking of the Indian consumer, he wonders if one can even call them the ‘Indian consumer’ because they're so diverse.
He explains this with an example. They say many Indian youngsters aren’t watching TV and are on handheld devices. It is true and also untrue. There is a large segment of people waiting to buy their first TV, thinking of it as their big acquisition.
Same platform, new skin
Soon after Elon Musk bought Twitter for $44 billion, IPG immediately advised its clients to pause advertising on the social media platform for a week after seeing the chaos that the Musk era had unleashed.
Did the parent company’s diktat trickle down to India? No, says Ohri. He hasn’t advised clients against advertising on Twitter.
The new normal
Musk, Meta, Google and Amazon laid off thousands of employees. Musk then said that Twitter will hire engineers. This year and next year will most likely see the market transform from employees to employers.
The key for both sides is to find the right fit. “People want to work in an organisation where the culture works, builds their capabilities, and they see the future,” states Ohri and points to the company’s Star One program where the company nurtures management trainees.
It is a noted entry-level program in the industry and Kulvinder Ahluwalia, CEO of FCB Ulka, an advertising agency under FCB Group India, is a Star One graduate. He joined Ulka in 1996.
Sometimes, it becomes hard to find people in bulk. That’s when acquisitions or partnerships become the answer. FCB Group India picked up stake in Kinnect, a digital agency, last year, though the talks had started even before COVID hit.
“I was clear that we were not looking at expanding or buying revenue and top line growth by acquisition. We needed to build the right capabilities for FCB Group India to take it forward over the next five to 10 years,” explains Ohri.
The result? FCB Group India saw its most successful year at the Cannes Lions 2022, winning 14 ‘metals’. “It is a huge journey and doesn't come from good luck. It comes from putting work at the centre.”
Is purpose a sin?
A Cannes Lions metal is considered the gold standard in most ad agency offices. India had its most successful year in 2022, with a massive haul of 47 Lions. However, many winners were involved in work which spoke about purpose, rather than pure business solutions.
This quest for purpose has also invaded most agency offices, with many questioning its existence only for the sake of awards. Poverty porn anyone?
Ohri believes in purpose, it needs to be there for brands. “It is not just about a cause or a societal good or working with an NGO, purpose is about what the brand does to better the lives of human beings. It, however, needs to be within the brand's ambit.”
And while brands celebrate great wins, should they share the ownership of the idea with an agency? It is the latest debate to hit adland. Ohri is clear that the ownership lies with the client.
“Fine art is in the pursuit of self-expression, whereas commercial art is a pursuit of market success. We’re doing it only because a brand achieves its goals in the market.”
And like that, the conversation, which zoomed from one point to another, suddenly came to a halt. Ohri had work to do, and I had to make sense of the conversation which, while transcribing, felt as weary as the suburb where FCB Group India is headquartered.