'Challenge is to harness the future focused SMG culture to build a differentiated product' : SMG India chairman and LiquidThread MD CVL Srinivas

Engineering and management degrees are quite common for professionals working in automobiles. But it is a surprise to find folks who have chosen to get educated in these two disciplines before plunging into advertising. Take CVL Srinivas for instance who has an engineering degree from BITs Pilani and a management degree from XLRI, Jamshedpur.

Today, Srini, as he is called, serves as the chairman of the Publicis-owned Starcom MediaVest Group India and also as the managing director of LiquidThread, one of its divisions.

He has 14 years of exposure to the media business, having scored numerous successes for leading media agencies such as Madison, Fulcrum and Maxus over the period as a senior manager or head. 

Srini is wont to do what he wants to do, like taking a four year break from media and advertising, and at a time when his career was roaring. In 2007, he gave up a plush job as CEO, Maxus Asia Pacific to become a consultant with Surewaves, a company that specialises in media convergence solutions. He then went to consult a private equity (PE) fund in the media sector and also worked with BCCL?s Private Treaties as director for two years.

SMG was his media comeback vehicle earlier this year. And it has been on fire under his and his colleague Mallikarjundas CR?s stewardship. It has focused on three pillars of insights and research, digital and branded content. In the process, it has not only managed to retain old businesses but also gained some new accounts. Among the 15 brands it pocketed include: Yahoo, Biba, Sab, Pix and Aircel. Prachi Srivastava spoke to Srinivas about his charge, its performance and the way forward.


How has the performance of the company been in this year, as it comes to an end?

We are fairly satisfied with what we have achieved this year. We have managed to grow both topline and bottom-line at a healthier pace than the past few years. In terms of new business, we had a surge of wins in the past few months. We have so far bagged 15 businesses this year including one of the biggest media pitches of the year Aircel (TV and Digital).

What was your focus this year?

We wanted to build on the strong foundation of SMG and accelerate growth. The focus was on (1) People - where we infused talent across levels and realigned a few units, (2) Product - investing in Insights, Digital and Content and (3) Process -streamlining the operation thru? a newly created Business Impact function.

You have been with multiple agencies. What difference do you see in the work culture? 

Each agency has its own work culture, but broadly speaking the end output in this market is hardly differentiated. You hear it from clients all the time, that they hardly see any difference between one agency and another. Our challenge is to harness the future focused SMG culture to build a differentiated product.

There were different specialist units earlier. Why were they merged in Vivaki?

SMG had a host of specialist units in Outdoor, Retail Branding, Rural activation etc. While they helped make the product more holistic, their ability to scale up was limited. By migrating them to VivaKi, we helped these units get access to clients of our group and brought about a lot of operational efficiency. This in turn has helped SMG focus on the core product. We now have the best of both worlds.

"Ours is a Human Experience Company that is a storehouse of insights & research that can help integrate communication plans across media and non-media channels"

Are clients showing an inclination towards the new media (digital, internet, mobile, retail) or they continue to be comfortable with traditional form?

There is definitely a lot more interest in digital now, than before. Not just the usual suspects, but even FMCG clients are today talking digital and investing in the medium.

How is LiquidThread doing since its launch in India?

We had an existing content practice in India. This made it easier to launch LiquidThread (LT) in this market. We have had a good year and have done some interesting work for our clients. There have been a few cases this year where LT created the campaign idea. We see it as integral to the communication strategy.

How do you see the economic slowdown affecting Starcom or the advertisers? spend?

Earlier forecasts were predicting an industry growth of around 15 per cent, but these days the consensus seems to be closer to 8-10 per cent. We expect to grow at a far higher pace than this given our client profile and diverse revenue streams.

Is it as bad as the slowdown in 2008? What have been the learnings from 2008 slowdown that you apply now?

It is too early to say if it will be as bad or worse. Right now most clients are in a wait and watch mode.

Television today has the efficacy for advertisers. How does it affect the other mediums?

We are largely still driven by television as the key medium. It not only has a high base but is growing faster than print and other mass media forms. While fragmentation has split the viewership across more channels, the evolution of Content on TV has kept the interest levels high for both viewers and advertisers. Digitization of the medium is going to give a further boost. For a growing economy like ours, where most categories are still under-penetrated, TV will be the lead medium for a long time to come.

Is reallocation of resources happening from client?s side across different media?

Clients are willing to experiment lot more today than they used to 5 years ago. There is definitely money flowing into digital, experiential marketing and events.

Has the concept of return of investments (RoI) changed with the clients? What is the measurement metrics followed now?

Very few clients are able to get the true measure of RoI and lot more needs to be done here by the industry. There is an over-emphasis on the "efficiency" of a media plan in our market. So in most cases, RoI measurement is limited to measuring how "efficient" the media plan is. This leads to a frenzy of CPRP and CPT calculations and debates. Marketers need to realise that the cheapest media plan is not necessarily the best option for building their brand. The agencies need to raise the bar on this one and encourage clients to invest in capturing more data. This is the starting point if one has to build robust RoI metrics.

SMG is pioneering lot of work in this area which I hope will benefit our clients in the coming years.

Have the dynamics for communication to rural market changed? How are you helping your clients communicate to their rural consumers?

Three significant developments have helped improve communication to rural markets. Firstly, the increased penetration of mass media allows conventional advertising to reach large pockets of rural India. Next, there are better technological aids to manage and monitor rural communication and contact programs. And finally there is a much better understanding of rural consumer behavior today than 5-10 years ago.

How will Starcom MediaVest?s business be split in Print/ TV/ FM/ outdoor/ Internet etc?

We have more than 10 per cent of our revenue coming from digital and hope to make it 20 per cent within the next 1-2 years. We have a fairly equal split between TV and Print.

As a media planner, how do you view the emerging radio and digital scenario?

For radio, a lot more needs to be done at the policy level to make the medium advertiser friendly. Currently radio stations are not differentiated enough for advertisers and listenership is extremely fragmented. The stations follow a herd mentality. Radio needs to deliver niche audiences. They should also be more relevant in this day and age and compete with the immediacy of digital media. As far as digital is concerned, it is the fastest growing medium and today there is absolutely no escape from it for any advertiser. Print is the medium that will get most affected by the growth of digital.

But we still see a dominant readership in print?

For a majority of the population, Print is still the first choice for daily news. For advertisers, Print is still the first choice for announcement value and immediacy. According to TAM, Print has grown at 7 per cent in Nov 2011 v/s Nov 2010, led by Services and Banking. The reason why print is still a dominant media in India is that every few years, new categories come into the market and most new categories start with print and only then they come onto TV and then other mediums, whether its education, insurance or healthcare. As and when digital penetration increases, Print could start feeling the pinch. Print needs to learn how to co-exist with digital if it has to remain relevant.

What is your strategy to integrate media plan across different verticals? How do you make that more effective?

Our dream is to grow our client?s business by transforming behavior through uplifting, meaningful human experiences. By investing in the right kind of talent and techniques we are trying to bring a more refreshing and relevant approach to communication planning for our clients. We do not see our job to be that of a media agency that releases advertising, but that of a Human Experience Company that is a storehouse of insights and research that can help integrate communication plans across media and non-media channels.

What do you have to say about the cut throat competition in the media industry?

I think it?s a good thing to have competition in the media industry as it keeps us all on our toes helps us get better in what we do.

Over the past five years what changes have you seen in media business, planning and buying?

Three things that are worth mentioning - a lot more focus on digital media, advertisers willing to invest in impact and a change in the profile of a media agency, especially with the influx of insights, digital and content talent.

Is youth still the hardest segment to capture?

Youth was a difficult to reach segment. With the emergence of digital media and several niche channels on TV, there are several options available. What is more important is the possibility to stay constantly engaged with the youth thru? social media platforms. Targeting the youth is not just a one-way effort, but an opportunity to build communities, conversations and advocates for brands. There is no better time than now to have Youth as a target audience.

When it comes to television, how do you stack up the genres as per the deliveries?

The IPL and one day cricket is at the top of the league followed by reality shows, general entertainment channels (GEC), blockbuster movies, and then some of the other genres. It?s more a question of what kind of audience one is trying to reach out to and the content you are looking to advertise, which determine the genre.

What kind of research you conduct before deploying digital media for any purpose?

At SMG we have an online panel that captures the latest trends across several markets including India. We have also done some interesting studies to understand the consumption of digital media among various target audiences in the region, including India. Apart from the available sources, our multi-disciplinary Insights & research team works closely with our communication planners for key campaigns.

What are your plans for 2012?

We have a few exciting plans for 2012. Apart from further strengthening our Product and developing our Talent pool, we are looking to partner with a few exciting players in core areas of our business. The momentum we have generated in 2011 with 15 new business wins is helping us aim for higher growth. We see a steep growth in our Digital and Content businesses.

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