Mumbai: Shashi Sinha was named chief executive of IPG Mediabrands’ Indian business last week. IPG Mediabrands is part of the Interpublic Group of Companies, Inc. and handles the marketing conglomerate’s media businesses, spanning several entities. Sinha was previously the chief executive of one of these entities’ Indian arms, Lodestar UM. Sinha spoke to Mint on his new role and the evolution of media planning and buying. Edited excerpts:
What does the consolidation of IPG Mediabrands mean for the IPG Group?
We are the No.2 company but we were not fully leveraging our combined strength. Thus, while the agency brands like Lodestar UM, Initiative and BPN (Brand Programming Network) had pedigree and vibrancy, a lot of things were done on the strength of these brands and not as a combined entity. To illustrate, our investments in research in a country as large as India channelizing large proprietary researches and tools like our 16,000 sample size consumer panel on which our tools like Matrix are housed will ensure we enhance productivity for all agency brands. Further, with our buying clout, our ability to spot opportunities and take big bets, to benchmark rates, to further leverage our branded content business are all gains from consolidation.
In a talent crunch, our ability to recruit and train talent will also go up as we offer scale and many (more) opportunities for our employees and prospects. We are on the threshold of making a big play in the digital space; digital is high on clients’ agenda and visibility, but due to its nascent situation, it will require handholding, and this is where the benefit of consolidation will be seen.
IPG has mentioned that the restructuring has helped leverage its No.2 position with more than 17% share of the Indian media market.
Needless to mention, we will start coming out with many value-added offerings which will not only benefit our clients but will also raise the bar for the industry and help improve the quality in the ecosystem. As far as our media partners are concerned, they should have nothing to fear as we will drive value for our clients…
As CEO of IPG Mediabrands India, what are the key things you’d like to achieve? What is your mandate?
In the short-run, the attempt will be to ensure there is a collaborative culture across all our companies which leads to better quality and value for our clients. I firmly believe the interests of all stakeholders, including employees, clients and our shareholders have to be aligned to deliver better quality and value. In the long-run, (my mandate is) to launch and drive value added offerings such as CRM (customer relationship management) and analytics.
Analytics and CRM are interlinked. As Indian media gets fragmented further, and for a variety of reasons, cost per contact will go up, it will become imperative for us to not only measure the effectiveness of our delivery but also find ways and means to reach micro segments at appropriate costs with a reasonable chance of success; for this, both analytics and CRM go hand in hand.
How do you plan to renew focus on the out-of-home business in India?
In my opinion, outdoor is the immediate opportunity to be leveraged—by consolidating all efforts with one team. Not only will we move towards a new name which will reflect the emerging situation but we will also take help from our global outdoor teams to bring in processes, checks and balances and best practices which are followed in IPG Mediabrands wherever in the world we have strong outdoor capabilities.
Margins continue to shrink. How will media buying/planning agencies survive?
While in the short-run scale helps, in the long-run, alternative revenue sources have to be created. I am very bullish about CRM which will be enhanced by digital penetration. As we improve our abilities to deliver to the consumer, clients will value our capabilities and pay us for our performance, and there is, literally, a pot of gold at the end of the rainbow. Pay for performance is not about getting some good bonus for good delivery of services, but actually being paid for every sale made by us.
There are challenges in the existing television measurement system in India (TAM Media Research). The Indian Broadcasting Foundation (IBF) is attempting to set up an alternative system through BARC (Broadcast Audience Research Council). How do media buying/planning agencies view the issue?
We may be late but we will get there. I am an eternal optimist and am sure, now that BARC is off the ground, the process of an industry-backed television measurement system has gotten off the ground.