New Delhi: After acquiring Bangalore, Karnataka-based design consultancy Ray and Keshavan, the UK-based global marketing communications conglomerate WPP Group Plc. is set to buy another Indian design firm.
The new design company will be housed under WPP’s subsidiary Bates 141, said a person close to the development, who did not wish to be identified. While declining to name the organization, he said an announcement is likely next month.
Marketing business: Bates 141 CEO Subhash Kamath says the agency, a WPP subsidiary, has identified retail as a growth opportunity. Photograph: Ashesh Shah / Mint
Bates 141, formed after a merger last year of advertising agency Bates and marketing services firm 141, has a mandate to focus on marketing communications of companies in Asia.
“We are on the verge of announcing a partnership in strategic design with an Indian company,” said Bates 141 group chief executive officer Subhash Kamath, without elaborating.
Kamath, however, said the agency has identified retail as a growth opportunity and will build its marketing communication expertise in that area. “Design plays a significant role in retail marketing. It enhances consumer experience,” he said.
Design industry professionals say there is a shortage of design talent in India, and hence, it makes sense for multinationals to buy designagencies in the country instead of building one up from scratch.
“There is not much quality talent available in the country because there are not enough good design training schools,” said Sujata Keshavan, managing director and executive creative director at Ray and Keshavan. “Instead of starting from scratch and training people, most MNCs consider acquiring an operational unit.”
WPP bought 51% stake in Ray and Keshavan in 2006.
Keshavan said almost 80% of the design work in India is done by advertising agencies. To deliver quality work and retain clients, most agencies are focusing on the design aspect and creating separate design cells.
“Advertising agencies such as Contract and Lintas have already set up design studios,” she said.
Bates 141 is trying to expand its retail marketing business and Kamath said the agency is talking with “four to five leading companies in fast moving consumer goods sector for their retail marketing business.”
He also said the agency is talking to retailers for their marketing communication as well.
Kamath said Bates 141 had achieved 300% growth in the past three years on the back of new businesses, mergers and acquisitions.
Bates 141’s clients include insurer American International Group Inc., automobile manufacturer Fiat SpA, furniture retailer Inter IKEA Systems BV, electronics firm LG Electronics Inc., fast-food chain Pizza Hut Inc. and mobile services provider Virgin Mobile Telecoms Ltd.