Mumbai: Media agency Mindshare has retained the Hindustan Unilever Ltd (HUL) business up to 2012. Consumer goods maker HUL, the country’s largest advertiser that spent a record Rs630 crore, or 14% of net sales, on advertising and promotion in the quarter to December, had called for a review in July.
Mindshare’s managing director R. Gowthaman led the pitch for the agency, his third for the HUL business. Edited excerpts from an interview:
Congratulations on retaining the HUL account. Were the last seven months stressful?
It’s not stressful, but definitely it’s an exhausting process. It’s pretty exhausting primarily because of the nature of the pitch itself, which involves multiple markets across the globe. So we have to go through the entire process. A pitch like this is (about) what we can do (for) the company in the future, not about the past. So your past doesn’t hold anything to you. It’s how prepared you are for the future challenges.
Road ahead: Mindshare MD R. Gowthaman says TV will still play a large role in reaching the consumers. Madhu Kapparath / Mint
So, I am very happy and elated that we got the business, but I can see what I have to do in the next three years’ time and that’s going to be quite challenging.
Tell us some of the things you’ve got to do over the next three years, without giving away state secrets.
There’s no secret here. It’s just that India is becoming multi-paced and we are getting into a diverse set of consumers across different segments and markets. So the old agency structures won’t hold any more as we can’t have a traditional cookie cutter media agency like we used to have earlier. And, if you look at the way we have grown, we’ve grown with Unilever in making our structure, and are growing with demands of the market as well.
So you will see some more challenges and changes from our own structure of the organization.
We are going to put it across to Unilever, and therefore, to the other clientele as well—whether it is about social media, whether it is about experiential marketing, whether it is about digital communication to rural communication, and the lines are blurring between agencies as well—between the creative agency and the media agency. So you’ll see things coming out. I can see what is going to be unfolding in front of us in three years’ time.
It’s very clear that HUL, while it is growing, is facing a lot of market share challenges. When a firm is the size that HUL is, when it spends the kind of money that it does on ad and promotions, what does it expect from media?
The challenges we have from a situation like this is to provide both scale and focus. They have got a multiple set of brands, as far as each brand is concerned, it’s by itself a big category or a spender compared to any other company outside Unilever.
So our challenge is to provide and do justice to each and every brand within the portfolio, without trying to have a broad brush approach. So it’s about top-down as well as bottom-up requirements and to make every single category within Unilever happy with their requirements, and that’s been the single largest challenge for us.
In 2007, we saw HUL talk about the reverse auction deal, which it made directly to media owners on a monthly basis. So is the cheapest media what a company like HUL and its various brands looks for?
I don’t think price is the only factor in the whole thing. But having said that, for a client of that scale and size, it can command a price that it can get for its worth of the volume. I don’t think anybody else can come to that scale to think of what we can talk about.
So you’re saying price is a given when you talk about such large spends.
It’s more than that. Reverse auction meant something at that point of time. The trading practice will change depending upon the market dynamics at that point of time.
We have just gone through a slowdown, and we are coming back into recovery mode. It may require a new kind of trading practice.
If you look at it, I keep telling this to many of my clients—today in a GEC (general entertainment channel), more than 95% of programmes have a below 1 rating.
So it’s like a perfectly replaceable spot between any programme, across every single channel. So the strategy will move from buying a genre to look at something else, beyond rating, to gain the audience attention.
It’s just not about rate or CPRP (cost per rating point), it’s about what we can do in the market place for any of our clients whether it’s a Unilever or every other client at this point of time. That’s the single largest challenge for us.
What role will television play, increasingly? We know that for FMCG (fast moving consumer goods) it is still the medium of choice.
We still have a growing TV population in the country. We still have 50 million people who don’t even have television. So I think as far as the Indian market is concerned, TV will still play a very large role to reach the consumers.
We have shades of fragmentation, if you look at the entire one billion population we have in the country, and the Unilever portfolio has shades of brands across the Indian population.
In September, when you did this big blockade first on the Star Network, then on Zee, then on Sun, did that show a renewed confidence in television as a medium? Or was it Mindshare doing whatever it takes to keep the business (laughs)?
No, it’s not. It’s nothing to do with us trying to get the business. I think it was about the share of voice that the brand requires at that point of time and to grab the attention because we did it for a particular brand, for a particular communication. And you know how the market is right now— desperately seeking attention is how we can grab the eyeball of the consumer.
So that’s one strategy or tactic that needs to be done at that point of time.
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