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World Sourcing | For Lenovo, the Hub now is India

World Sourcing | For Lenovo, the Hub now is India
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First Published: Mon, Jan 26 2009. 08 48 PM IST

Updated: Tue, Jan 27 2009. 01 57 PM IST
When A.R. Rahman became the first Indian to win a Golden Globe Award for his music score in Slumdog Millionaire, a movie filmed in Mumbai with a cast of largely local actors, Indian creative talent gained international recognition. But creative inputs from Indian studios, whether it’s storyboards for animated flicks or advertising copy, have been gaining acceptance steadily across the globe, albeit without the attendant media spotlight.
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“Slumdog Millionaire has proved that what India has to offer is now acceptable to global audiences; we are not defending India, we are selling India,” says Poran Malani, president of Hub operations, Ogilvy and Mather (India) Pvt. Ltd, Bangalore.
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Malani knows what he is talking about. In the last eight months, an Ogilvy and Mather, or O&M, team of 80 advertising professionals, in partnership with the Bangalore-based global marketing hub of computer maker Lenovo Group Ltd, has created six television commercials and 5,000 print advertisements for the multinational computer maker—these have been aired across the world. These commercials and print campaigns include the Ideas Everywhere series as well as the Lenovo brand campaign that ran during the 2008 Beijing Olympics. “We are putting a face on Indian talent,” says Malani.
Forging relationships: The aim is to create a core of global competence that can be adapted to local needs.
For Lenovo, the Hub is a unique experiment in setting up a single marketing communications engine for its global operations. This model of sourcing expertise from where it is best available, described as world sourcing, allows companies such as Lenovo that function across multiple geographies to create a core of global competence that can be adapted to local needs.
When it first started in 2007, the Hub had to develop credibility within the global operations of Lenovo. It began on a low key, delivering advertising services. But now, if the US operations of Lenovo wants a television advertisement, it partners with the Hub to work out a brief—the Hub then takes over. “We do the entire concept from here—be it a digital marketing campaign, television spot or print flier,” says Malani.
“It is not just the advantage of cost that India offers; it has a great reputation for very high creative skills and, of course, the language capability is an advantage too,” he says, adding that it was initially difficult to convince marketing professionals in mature markets to trust such culturally sensitive work to a remote location.
“But once the Hub began to deliver consistently high quality creative work, the acceptance level across countries improved,” says Rahul Agarwal, executive director, global marketing hub and marketing communications, Lenovo. He says that it is in the last six months that the Hub has emerged as the single point for all marketing communication needs across Lenovo globally.
“Now anyone visiting Lenovo in Bangalore wants to come and see the Hub. It is intriguing for them to come here and see how we manage communication functions for the entire global operations from a single location,” he says.
For O&M, there is no precedent for the kind of relationship it now has with Lenovo. Says Malani: “This is the first relationship of its kind; because of the volume and complexity, we meet three to four times a day. The result is a far more symbiotic relationship which leads to greater understanding and, therefore, increased productivity.”
Agrees Agarwal, “While there is no fundamental difference in the relationship, it’s at a larger scale and more complex due to time zones and geographical differences.”
Advertising generated by the Hub has shown a positive impact on the Lenovo brand, with awareness of the brand improving from 40% in 2006 to 62% as of September, while brand referrals grew from 45% to 56% in the same period, says the company.
Initially set up as a centre for advertising services, the Hub today handles communication strategy and execution, analytics and alliance marketing for 40 markets globally. “We now have a significant say in Lenovo’s master brand strategy, which is a collaborative process across Lenovo’s offices spread across the globe,” says Agarwal.
The other significant innovation from the Hub has been the monitoring of marketing communication, termed return on investment (RoI) dashboards. Till a few months back, just the top 10 markets for Lenovo would calculate RoI on marketing spending.
Creating synergy: Lenovo’s Rahul Agarwal (left) and O&M’s Poran Malani. Hemant Mishra / Mint
Now, with the single communication operation at the Hub, spending on marketing is monitored consistently for the RoI score. “This approach to business that is created to drive efficiency has become a tremendous operational edge for us,” Agarwal says.
The other major input from the Bangalore centre is the development of high-end e-commerce analytics, which is driving the growth of online sales for Lenovo globally. Internally, there is a four-member analytics team that is geared towards building greater value addition. “We aim to focus on areas such as business analytics, where we analyse past behaviour of customer profile and predict future trends,” says Ranjit Kulkarni, general manager, analytics, global marketing hub, Lenovo.
As the Bangalore centre takes on more analytics work, it is leaning on a network of partners to build greater value addition. For instance, a statistical modelling exercise termed market basket analysis, which analysed the kind of accessories customers opt for while purchasing Lenovo products online, was driven by the analytics team at business process outsourcing firm WNS Holdings Ltd in Bangalore. “With the statistical modelling method, we can show the affinity of each product with specific accessories, thereby driving revenue associated with particular products,” says Sanjit Bhowmik, vice-president, sales, WNS, North America.
The WNS analytics team that works on the Lenovo account is located in Bangalore; so is the O&M team, which works on the same floor of the office that houses the Lenovo Hub. “Co-locating a client and the team makes the process a lot simpler,” says Bhowmik, adding that there has been a growing acceptance for this concept of centralizing functions at a single location since the start of the outsourcing boom.
“As the concept of the Hub gains wider acceptance within the Lenovo organization and more funding moves to projects there, we expect an increased flow of business,” says Bhowmik. He expects more companies in the consumer goods, retail and technology sectors to adopt such a model as the need for cost-efficiency becomes greater.
And as technology companies look to sell directly to consumers on an online platform, the need for digital marketing and analytics to support it will become the focus of operations at the Hub. So far, print and television advertisements have formed the bulk of the output. “Going forward, the Hub will lead in improving the role of interactive and digital marketing, driving Lenovo’s e-commerce globally,” says Agarwal.
Globally, Lenovo divides its marketing effort into two—one for mature markets, where online sales account for roughly half of the revenue, and emerging markets such as India, where the share of online sales is lower. “But even in India, this share is growing. Three years ago, the share of online marketing was 5%, which has now grown to 15–20%,” says Agarwal, who expects to build a robust network of digital marketing partners to enhance the Hub’s offering in this segment.
Among the digital marketing initiatives that have emerged since the Hub took on online campaigns in August is the campaign to change promotional banners online instantly, a feature that was developed in partnership with the US-based Tumri Inc., an online digital marketing services provider. “We have also used technology such as Boomerang that helps capture user details and allows a banner to follow a user across different online sites,” says Agarwal.
Bridging cultures
It is in integrating cultural nuances that the Hub has faced its biggest challenge.
“When we first began, we faced opposition from pretty much all markets,” says Agarwal, who says there have been different tipping points for different countries. He says the final tipping point for the Hub was China—as the largest and oldest market for Lenovo, it was initially not part of the Hub’s scope of operations because of its unique consumer and market profile. But marketing communication for China is now handled out of the Bangalore centre.
To help local employees acclimatize, the Hub has 35 employees, including expatriates from several countries. Generally, they lean on inputs from marketing teams on the ground in the 40-odd countries they service to alert them to cultural sensitivities. For instance, the use of a yellow bulb in the Ideas Everywhere campaign had to be reworked in Turkey, where the bulb was the symbol of a political party.
Cultural sensitivity is a point of issue with the Hub’s partners as well. At O&M, Bangalore, there are five-six expatriates on the team.
Even as team members juggle with at least 12 time zones and build relationships with clients across cultures, this experiment in building a multicultural marketing communications team is clearly one that is piquing interest. “There was really no precedent for such a model globally until the Lenovo Hub in Bangalore was set up but this is a model that we expect will grow exponentially in the future,” says Malani.
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First Published: Mon, Jan 26 2009. 08 48 PM IST