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MUMBAI:
WPP is on the prowl for digital deals in India as it seeks
to expand its business in emerging markets to beat the slow
growth in the matured markets of the United States and western
continental Europe.
Continuing
its acquisition spree in the digital space, WPP has taken
a 51 per cent stake in Mumbai-based Hungama Digital Services.
Earlier, WPP had shopped in Indonesia, acquiring digital agency
Magnivate.
The
purchase is made through JWT Singapore, a wholly-owned operating
company of WPP. Opening up the next new frontier, JWT will
control the digital and promotions marketing division of Hungama
Digital Entertainment.
WPP’s
hunger to grow in the digital space is obvious as it has set
itself a target of getting 35-40 per cent of its revenues
from this medium in the next five years. The agency’s
digital revenues totalled $4.8 billion in 2011, representing
approximately 30 per cent of the group’s total revenues
of over $16 billion.
The
new investment in Hungama Digital is in line with WPP’s
strategy of developing its services in fast-growing markets
and sectors and strengthening its capabilities in the digital
media.
Says
JWT India CEO Colvyn Harris, “Digital is our next new
frontier. The idea of the partnership is to build a digital
offering for our clients so that we can live up to being a
‘single source’ partner across all their ‘marketing
solutions’ needs. What will be most effective in the
future is a new set of talented, digital high end specialists
who will add new skills and capabilities to what JWT already
offers to its clients. We want all our clients to be leaders
in their respective categories.”
The
new entity will be a full service digital agency specialising
in digital marketing and social media solutions. Hungama’s
activations arm, Hungama Promo Marketing will become a part
of Hungama Digital Services and provide an engagement platform
linked to online and offline deliveries.
For JWT, the new buy will help WPP participate in India’s
digital revolution with an estimated 500 million consumers
going online in the next 3-4 years.
The existing team of 120 people of Hungama Digital Services
will continue to drive the agency. They will service old and
new clients and offer creative and promo marketing services,
viral marketing campaigns, social media marketing and mobile
marketing, applications, managing websites and video services.
JWT Asia Pacific has moved aggressively into the digital space
over the last year. It has expanded both organically and through
acquisitions.
Hungama
Digital is WPP’s second digital buy in India and comes
after five years. In 2007, WPP had bought out majority stake
in Quasar Media in 2007.
Hungama
Digital Services offers strategic planning, web design and
maintenance, digital marketing, search engine marketing, social
media optimisation and communications strategy, rich media,
viral marketing campaigns, merchandising, events and conference
management, and sampling. The agency has clients like Mahindra
& Mahindra, Bacardi, Godfrey Philips, Britannia Industries,
Tupperware India and Hindustan Unilever in its portfolio.
Says
Hungama Digital Media Entertainment MD and CEO Neeraj Roy
said, “With JWT, we are now part of the largest advertising
network in the world. Hungama Digital Services is the coming
together of two exceptional teams in a globally relevant market.
From augmented reality to developing applications for connected
devices, Hungama Digital Services has been at the forefront
of digital technology. With this partnership with JWT, we
hope to offer integrated digital and experiential services
to our clients and prepare brands to connect, interact and
now transact with their customers.”
India
is beginning to live the story of acquisition in the digital
space, which is bound to grow by leaps and bounds. In April
2012, Publicis had bought out Mumbai-based full service digital
agency Indigo Consulting, a company which provides website
design and development, search engine optimisation, usability
research and testing, and marketing online, on mobiles and
social media.
“The
game is very simple. Digital is at the centre of an agency’s
planning today. Either you have managed to work out a deal
with a digital agency that offers full range of digital services
or you bring different digital agencies with different specialties
under one umbrella,” explains Leo Burnett chairman and
CEO, India sub-continent Arvind Sharma.
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