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Advertising Interviews

Kamal Oberoi

MD | 11 Feb 2011

The crucial challenge is all about markets. It is all about being able to justify the fee or the revenue which the agency merits. I think that is the biggest challenge. There is tremendous pressure and if you are able to demonstrate the value which you add to the client’s business and therefore, justify what you truly deserve as remuneration. The challenge linked to that is to have people who have the capacity to deliver on that platform.

Kamal Oberoi is a much respected figure in the Indian advertising industry. He’s currently the Chairman of M&C Saatchi which he set up in 2005. In two years time, M&C Saatchi got the unique distinction of being ranked among the top 20 agencies in India by Economic Times.

Prior to this, he spent over 20 years at J. Walter Thompson, heading JWT India as President. During his tenure there, he developed a strong market strategy for JWT, expanded the client base and enforced rigorous productivity norms. He successfully headed JWT’s offices in Delhi, Bangalore, Chennai and Kolkata. Under his leadership, each operation grew in profitability, client profile and employee morale.

Oberoi has stewarded brands like Pepsi, ITC (BAT), Hero Honda, Nestle, Ford, Levis, GSK, Frito Lays, Kingfisher beer, Unilever’s tea brands, Pizza Hut, Jet Airways and Bajaj Allianz.

Oberoi holds an MBA degree from Faculty of Management Studies (FMS), Delhi and B.A Honours degree in Economics from the University of Delhi. He has been a member of Executive Committee of the National Culture Fund (Dept. of Culture, Govt. of India)

In conversation with exchange4media’s Preeti Hoon, Oberoi talks about the way ahead for the advertising industry.

Q. Do you think the uncertainty because of the slowdown is over? How is the industry looking now?

The uncertainty is certainly over now. 2010 was a much better year than 2009. You saw more advertisers coming into the market space. There have been product launches, brand extensions which were kept at bay in 2009. There were certain sectors which saw a slowdown in 2009 like real estate which mushroomed back in 2010. The advertising and entertainment sector too came back into the scene.

Q. Where is the advertising industry heading in the New Year?

The economy is growing very well. Nobody expects a slowdown. The growth in the advertising industry always mirrors the economic growth. It should continue to give a double digit growth.

Q. What according to you are the most crucial challenges in this year for the industry?

The crucial challenge is all about markets. It is all about being able to justify the fee or the revenue which the agency merits. I think that is the biggest challenge. There is tremendous pressure and if you are able to demonstrate the value which you add to the client’s business and therefore, justify what you truly deserve as remuneration. The challenge linked to that is to have people who have the capacity to deliver on that platform.

Q. Do clients prefer to work with a digital arm of an ad agency or do they prefer a digital shop?

If the agency offers digital services, the clients prefer to go to them. Why should they go to another one? Digital is a broad term. It took us almost two years to develop all the services in-house under that field. Once the client is comfortable that you will be able to cater to all the needs they will obviously prefer to go for the same agency and not waste time in keeping separate communication and make sure there is no compromise on the brand’s value.

Q. But do you think the cost factor plays an important role in taking the client to an independent digital shop?

No, it is not necessarily so. It is not the cost factor, it is the factor of being able to provide those specialised services because there is so much of depth that is required. It doesn’t only mean creating a website, it involves a whole lot of other services. If the main agency is able to understand and deliver, they will prefer going to them only.

Q. How does the industry measure its success? Does number of awards gives you a satisfaction?

Awards gives us a good feeling. It is an appreciation from the peer group and the marketing fraternity per se. But it is not all about the awards. The biggest success is when you see that your are able to add value to the client’s business, when you see that the brands you handle are doing well in the marketplace, it gives you the biggest satisfaction. When clients continue the relationship, continue to add business to you, it is more important. Awards are good but in day-to-day life these things matter.

Q. They say creativity level is declining in the industry day by day. Would you agree?

Things have become much more competitive and complex, I would say. And therefore, getting ideas which are completely media neutral and are able to effectively reach the consumer has definitely become much more difficult that what it used to be. Earlier, you had one television channel, one program but now the scenario is in front of you. So, I won’t say the creativity is declining; it is just that much harder.

Q. What do you think of mobile as a medium?

It is a great medium but you got to be careful about its intrusion level. Yes, it has huge potential. I think what is important is its effective usage. We still haven’t been able to crack the mobile industry in India. Though, the SMS tool is a bit intrusive, it is still an effective medium. One needs to go through the technology of phones too for their effective usage. For example- a blackberry phone profile is completely different from any non-multimedia phone. So if you have these clusters made and set targeted communication, it will work. The real estate industry does 80 per cent of its advertising through mobile and there are several other examples of sectors which are using it. I think a lot of work needs to be done in this space and there are a lot of people who are doing it.

Q. How can the mobile medium help a mainline agency?

The agency has to develop an understanding of the medium first. We are still lacking in that. Training would mean investment whether in terms of research, profit or to create models for experimentation. People are doing it. I think it is a sheer matter of time.

Q. Recently, Reckitt Benckiser called for a pitch and asked the agencies for money to participate in it. Do you think it is fair?

I don’t think it is fair, in fact, I think the agency should charge them instead for pitching and for giving them ideas.

Q. What is your vision for the Indian advertising industry in ‘11?

It is exciting time and also much more challenging. The biggest challenge is to connect and continue develop understanding with the client, to be able to deliver ideas which are completely media neutral and be able to justify the remuneration.

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