"The biggest agencies do not necessarily produce the best ideas " : Starcom business development head Ravi Kiran - Part Two

You would not be blamed if you missed Starcom Mediavest Group India's general manager, investment and business development, in a crowd. With his hair cropped short, and his dimunitive and lean frame, the bespectacled Ravi Kiran has none of the flashiness which many advertising professionals tend to display. Calm and self-composed, soft-spoken, and non-intrusive is the first impression one gathers on meeting him.

But get a little closer and probe some more and you realise that there's a bomb ticking in his brain, a bomb of media and creative ideas which explodes regularly.

Under his belt are brands which many a peer would just die to handle. This apart, his talent has been recognised courtesy his being invited to industry fora.

You can learn more about Kiran by clicking on the following link (Ravi Kiran: A man of many parts), but for now it's time to read the second part of the interview with him which was conducted by's managing editor Abraham Thomas who chatted with him in Mumbai. Excerpts -



Looking at 2003, how will Starcom's business be split vis-?-vis print/TV/outdoors /FM/Internet, etc?

This is not an easy question to answer. Our current clients' needs are changing fast. Our account mix is also changing rapidly. While the FMCG clients continue to be an important part of our portfolio, there has been a lot of change over the last three years.

In these years, we have been chosen by many clients who wish to communicate with interest groups such as men and working women. Some of these clients include Hitachi, Toyota, Raymond, Western Union and more recently LVMH Watches and Jewellery. Other clients such as Fiat are much more active now than ever in the past.

We are trying to convince our clients about the need to explore new ways of looking at how human beings process information and act on them; and to examine the human passions that can be leveraged by brands [At SMG, we call this Passion Group Marketing].

This aspect, by itself, is significantly changing the share of each medium in our portfolio. As an agency, we pride ourselves on being media-neutral. Our commitment to brands and customers continues to be a priority. Media is our weapon; we will use each one as we require it rather than declare loyalty to any one or two.

Having said that, I do believe that TV and Print will continue to occupy the top 2 slots for us as the biggest reach vehicles. I estimate that anything between 70-75% of our clients' media resources will be invested in Print and TV.

We already have a very strong Digital product and some of the most Digital-savvy clients such as ICICI have already entrusted us with their portfolio. Several others are talking to us and we believe that this medium will be strategically important to us in the coming years.







" We are trying to convince our clients about the need to explore new ways of looking at how human beings process information and act on them; and examining the human passions that can be leveraged by the brands"





How important is research?

More important than most people are willing to accept. Research is a tool to drive business and also to measure success. At Starcom, we have been lucky. Way back in 1997, Pravin (Tripathi) set the tone and drilled home the absolute criticality of research in what was then the media department of Chaitra Leo Burnett. When the whole market was running after rates and savings alone, Pravin was building the smart and sensible agency that you see today.

My current boss Andrey (Purushottam), when he joined us in July last year, brought in a clear marketing perspective and reinforced the need for focusing on delivering business results to our clients.

Our current orientation involves giving equal emphasis to Strategy and Investment. At the risk of sounding immodest, I must say there is hardly any media agency in India which has got as much research prowess as us. Even within our network, India is recognized as one of the best Research-rich offices.




What is the quantum of advertising that Starcom handles on the television front? Who are the major clients and brands?

Starcom handles a business of just over Rs 3500 million annually and the business is growing. Some of our largest TV clients include Heinz, Balsara, Raymond Apparels and more recently Dr. Morepen. Even clients such as Toyota, Fiat, Hitachi, Western Union and Parle Bisleri use TV extensively.







"In every market in Asia as well as in India, we are in the Top 5. In many markets such as Singapore and Thailand, we are in the Top 2"





Where does Starcom figure in the pecking order amongst the media buyers and sellers in India and Asia?

The pecking order argument makes more meaning now to financial analysts and prospective investors than the media owners. What matters more is the agency's ability to build the scale required to make continuous investment in people, training and technology.

But since you asked a question, you deserve an answer. In every market in Asia as well as in India, we are in the Top 5. In many markets such as Thailand, we are in Top 2.

And in case you are wondering, once you are in the top league, it does not matter to Media Owners and to Clients whether you are at number 4 or 5. As far as delivering the media product goes, your pecking order really plays very little role.



What innovations has Starcom done in terms of buying or planning for TV? Can you give some illustrations? Which channel(s) offers the most as far as innovation is concerned?

Our whole approach to innovation is such that many of our achievements cannot be made public without compromising the client confidentialities. You see, it's much more than what is available for all to see. But I can certainly give you some illustrations.

Earlier, I spoke about Hugo Boss, Toyota Qualis and Kellogg's 'Cheez-It'. The Toyota Qualis launch is a benchmark for us internally because the innovative thinking was part of the tactical planning, something often considered to be boring and mechanical. It also proved to us that the specialist channels by themselves can deliver the goods. This is a learning that we have replicated for relevant brands.

For Fiat, we launched the Siena using a combination of sports and TV; but without even buying a single TV spot. We worked very closely with BCCI, the event sponsor and the television production company [IMG/TWI] to announce the Siena as the prize for the Player of the Tournament,for the first time in India. The results were fantastic.

Recently, we persuaded BBC World to carry its first-ever branded show on the Channel, anywhere in the world. The channel's sports bulletin Sport Today became Fiat Sport Today. Last year, BBC had broken another internal 'rule'. BBC opened up World Weather for sponsorship by our client Hitachi Air conditioners, for the first time in the Channel's rather strict history.

I don't think there are only one or two channels that are innovation sensitive. It's very individual dependent. I wish someday media owners make innovation an organization culture.



Do you work on commission basis or commission plus retainer basis?

We don't work on any one standard compensation model. We adopt our model to what best suits a client's needs. We are continuously trying new ways.

In addition to the straight commission and a flat fee, we also have hybrid systems that combine the benefits of the two. Many of our clients incentivise us over and above the base fee for better than expected performance. In such cases we are also willing to take a disincentive if we under-deliver.



What are the key qualities needed to be a good media buyer/planner?

First of all, 'to be good is no longer good enough'! Five years ago, when media as a function was just coming out of the closets, everyone in the industry believed that a good media planner had to be good in mathematics or statistics. Similarly, people also felt that the most experienced operations executives would eventually become the best media buyers.

In hindsight, many of this stereotypical thinking seems outright childish and over-simplistic. It is amazing as to how some of our fundamental assumptions about 'what makes an effective media professional' have completely changed.

The fact is that Media is not Mathematics just as Creative is not Fine Art! Media must move a tube of toothpaste off the shelf and it must ensure that the increasingly cynical consumer heads towards that car showroom!

While recruiting people for our company today, we put a lot of emphasis on qualities such as idea sensitiveness; willingness to question the known; to break the rules; ability to handle ambiguity and work under near-inhuman pressure. The domain knowledge is very important; but it can be acquired. Fire in the belly can rarely be acquired!

Generally speaking, people in our industry are risk averse. At Starcom, we believe that the best time to take a risk is when the pressure is the high and the times are tough. We encourage our youngsters to take risks with the full knowledge that they might fail.

Detractors may say it's not right to take risks with our Client's money; but most of us now agree that there is no risk worse than playing safe. In fact, we are also trying to persuade our Clients to take measured risks in Media when there is a possibility of good upsides.

Of course, a person who is shy of analysis will anyway not like Media. The media planners of today have to be ingrained with a certain high level of analytical skills; but simultaneously have to be creative in their analysis.

Therefore, creativity and 'out-of-the-box' thinking are absolutely imperative. They must make an attempt to break the rules. Every business has developed some thumb rules as to what succeeds and what doesn't. There is a clear need to clinically examine them and chart out a new path.

What is important is that even the media buyers need to develop pretty similar skills. They need to go beyond the earlier tendency of just being 'friendly' with the space/time sellers. They will need to develop real insights about what motivates the media owners. They should also be able to make reasonable and consistent predictions in a market that is known more for the failure of predictions.



In general, are media businesses (planning and buying) profitable in India today due to the slender margins that exist?

This a very popular question. Most of the media agencies are still brands; not separate companies. Most of them are now learning to manage a separate P&L. As expected, many are stumbling. We are fortunate to have separated our P&L from Leo Burnett way back in 1999 and learnt the ropes early in the day.

Even now, we have a few unprofitable clients, but overall we make a profit. If you ask me, the key problem is that the profits are not enough. An unhealthy bottom-line limits your ability to invest in people, training, research and technology. So far, we are doing okay; but I'd like to see a better bottom-line.

As regards other agencies, I really wouldn't know the truth; but I have read many a horror story. Our industry problems are as much related to cost management as to revenue growth. The fact is that the revenue growth will be slower than ever before and therefore we need to be careful about costs.

Unfortunately, perhaps, the biggest cost element in Media- Tools and Research - is not something you can cut back on. One can't reduce payroll costs beyond a point, because there is a high risk of losing good people and being unable to attract fresh talent. There is not much of a choice, as you can see.

This is the point clients need to see. Clients often look at their media budget and somewhere deep down; think it's all going into the agency's revenue. It's not that they do not know the truth; they are just trying to save a buck for their company.

Unfortunately, agencies will never really fund their client's business, so when the pressure gets too high, they will cut back on the product quality. When many agencies do that, the client interests will suffer.



With growing consolidation, media sellers fear an even more skewed market. How should a media seller/marketer respond to this trend?

I don't think that the media sellers have anything to fear from consolidation of the buying power. In many ways, having to deal with fewer agencies should actually help the seller use her time more productively. In any case, beyond a point, size doesn't really matter.

In a market of general oversupply, knowledge and ideas matter more; and that is as dispersed as it can be. The biggest agencies do not necessarily produce the best ideas - in creative as well as in media. That is what the media owners should understand and should take comfort from. In fact, they should find a way of rewarding ideas rather than the size. I think many of them already do.

'Economy of Scale', which is what the whole size argument is based on, is an industrial age principle and is best suited for the assembly lines. That is what over-dependence on the size makes you do. Media cannot be treated like an assembly line product.

I think we are moving on to an age of 'Economy of Knowledge and Ideas', even while keeping the best benefits of scale intact. And that is the beauty of the concept.

Talking about media owners' fear about consolidation; isn't it a fact that there is consolidation even amongst the media owners? They are doing it for the same reason as that of agencies: to be able to get back room synergies; to fight competition better; and to have more resources to invest back into business. So consolidation is not really an issue of ethics or something, it is purely business.

More importantly, while trying to grow our own businesses, we must not forget that there is an overriding objective that both media owners and agencies have both committed themselves to, even if tacitly. And that is to help advertisers move their wares off the shop shelves and help them build their franchise.

So in a way, even while appearing to be working at cross purposes when negotiating a deal, both the constituents must not forget that they are not adversaries. I am not going to use much maligned words like 'partnership' here; but I do believe that once they open up their minds and collaborate even while competing, both will achieve more.

The reasons for the lack of growth in advertising expenditure are that the consumer spending is slack and competition is stiff. Marketers are finding it more difficult than ever before to move their goods.

Simultaneously, traditional advertising is growing less potent. This also tempts marketers to move money from media to 'below the line' and promotions because these media often give healthy and immediate results.

So it is in the interest of media owners to help marketers achieve short-term results, which is bound to bring some of the investment back to media. For far too long, advertising [agencies and media] has focused largely on long term brand equity and left it to the marketer to bother about such 'mundane' things as this month's off-take. I believe that time is behind us.



Accountability seems to be the most critical issue for a client. Is the environment becoming more accountable? Key Indian channels have gone back from offering CPRP linked deals. As a media specialist, what would your terms of reference be as far as accountability is concerned?

I do believe our industry is getting more accountable; but not fast enough. CPRP is one of the several ways that indicate accountability. Even that has not been properly explored: neither by the agencies nor by the media owners. To me, the debate is not whether CPRP is the right currency but whether we should look for a currency. To me, accountability is fundamental to service delivery. In supermarkets overseas, if a customer slips on a slippery floor and injures herself, the store is accountable. Legalities apart, I think that it represents a mindset that is very important in a service industry. Why do packaged food items display a 'best before' date? Why do marketers now give money back guarantee if you are not satisfied with their product? That's accountability. And as you can see, many of these are fairly recent phenomena, often mandated by law.

I believe media is way behind many fields in this area. It will be sad if media accountability has to be enforced by a law. The media business is a mature profession involving educated people on all sides and respectable associations. Therefore, we need to define the contours of accountability and move ahead.

More than anything else, we need to recognize that accountability cannot be a one way street that is used to squeeze the media owner. What happens when a client delays payments or even defaults? What happens when an agency intentionally reports wrong GRP figures? What happens when a client wants to wriggle out of a deal mid-way through? If we are willing to be selective and gloss over some of these issues because of a distorted perspective of the superiority of bargaining power, then we have no business talking about accountability. We have to be fair on all sides; I really mean 'all'.



From the point of view of a media buyer, what are the key opportunities in the near future?

First of all, buyers have to evolve into an investor mindset. While making intelligent and meaningful use of data, they need to develop a judgment that would help them forecast the future with reasonable chances about the accuracy of the predictions.

They need to take risks and encourage clients to allow them to experiment and innovate. They need to get more 'brand' focused rather than 'deal or saving' focused. The Indian media market has many imperfections and there are lots of shades of grey.

Our opportunity is to take full advantage of the fluidity for our clients. Instead of worrying about the growing complexity of our task, we should learn to exploit the ambiguities.

Perhaps more important than anything else, our opportunity lies in reducing the over-adversarial tension between the media owners and ourselves. It is time to collaborate and make our clients win over the consumers.

At Starcom, we are trying out a new concept called 'Media Affinity Marketing', which is helping us realize large unexplored potentials within both the media owners and the client companies. This concept goes beyond 'airtime' and 'money' --- the two standard products --- sellers and buyers trade in. From the initial looks, the result will be sheer magic.

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