100% increase in annualized revenue from new business in 2014, (as compared to 2013), a higher success rate in pitches, close to 100 wins and a significant rise in average revenue per win, a clear focus on startups and digital are some of the things that are giving Lowe Lintas and Partners a momentum.
While the advertising fraternity continues to feel the challenge of shrinking revenue and margins, Lowe Lintas and Partners India decided to put ’skin’ in the game, in its partnership with clients. The first step towards this was setting up a focus on building the agency brand.
“I felt the need to do this pretty much around the time I took over (Jan 2011), when the economy and the industry were under pressure. Like we keep telling our clients, you need to focus most on your brands when there is pressure in the market/environment. And the reason for me wanting to focus on building brand Lowe Lintas is the same reason clients want to build theirs, ” shares Joseph (Joe) George, CEO, Lowe Lintas and Partners.
When George appointed Vikas Mehta as CMO in September last year , (though a Chief Growth Officer role in the media side of the business had been heard of), a marketing officer in an advertising agency was a novel idea, which left the industry wondering what exactly would be Mehta’s role.
“In my belief, the marketing function in an agency (or at least in this agency) subsumes the growth function. The mandate for this role and indeed to Vikas was to partner me in driving top line growth, reputation management and new strategic initiatives & collaborations. In fact, I was clear I was looking for somebody who could go beyond the growth mandate; which is why he was brought in as CMO,” explains George.
Mehta has worked in the Lowe + Partners network in three countries in multiple local and regional leadership roles.
Going beyond Pitches
Mehta believes that the one thing in building something from scratch is the ability to get it wrong before you get it right. He elaborates, “If you look at our business, we are not a consumer brand, we are a B2B brand. With that lens, if you look at any B2B company, being a source of growth is an essential part of the marketing function. So our mandate No. 1 was to have a plan for growth, rather than letting growth become the outcome of things. 9 times out of 10, any agency’s growth is - how many pitches can I get into and how many of them can I win? Is that the only way to grow? Certainly not. Is that the best way to grow? Sometimes.”
Explaining the approach towards his role, Mehta says, “Because we had at our disposal the presence spread across nine cities, and a multidisciplinary expertise in terms of the divisions, there was more to growth that we could do. Above and beyond pitches. So we built what we now like to call the growth team. We have very measurable KPIs in that sense. So there is an overall group target for the agency which we take accountability for. That’s a combination of organic and inorganic growth.”
George adds that their marketing programme and approach has been designed keeping many constituents in mind. “It suffices to say, the results have been more than evident and pleasing across metrics. Directly or indirectly, this initiative has led us to perform better across the board - new business performance, revenue realisation, reputation, employee motivation and pride, talent acquisition, agency engagement, cross and up selling of our product offerings,” shares George.
Growth Strategy : Less is More…
As Mehta had mentioned last year, something that was true for the agency for the last three years was that they were winning at the rate of 100 plus businesses in a year. “This year we actually signed up less businesses than that. But the whole focus was that it’s not a score sheet. We need to get businesses that will add value to the agency. To have a value-driven approach rather than a volume-driven approach. Because in new business there are no extra prizes for scoring a century. We scored less businesses than last year, but the value has jumped significantly,” remarks Mehta and adds that the agency has seen a significant rise revenue per win this year (in comparison with 2013).
Focus on startups
The agency also consciously focused on e-commerce and the startup ecosystem of companies, laying down the groundwork. The results are beginning to show with the likes of Flipkart, Myntra, Paper Boat, FreeCharge, Policy Bazaar and Bharat Matrimony.
Apart from increasing the pie of business from existing clients, the agency has also increased its strike rate at pitches because of being able to have ‘adult’ conversations with the client, as Mehta puts it.
He further explains that the agency is engaging with clients with a lot more understanding of their business objectives and problems, and this year they have won a significant number of businesses without a pitch. “Because now we have a cross functional growth team which is genuinely domain agnostic, we have no preference of selling one domain over another. We actually have an adult conversation with the clients about the business problem. We are not selling our PR, digital, activation agencies separately, we are saying if this is your reality and this is your ambition, and this is the operating structure of your marketing team (because sometimes even that can become a huge consideration), we believe that your solution requires these capabilities. And we believe from the seven businesses we are in, this is probably the combination you need to begin with us. A lot of these conversations end up being a lot more fruitful rather than taking a very cross selling approach,” he elaborates.
In fact according to Mehta the agency wants to be paid premium only if the client’s business succeeds. “If we don’t meet the client’s business goals, without blaming who is responsible for the failure, we will take a cut in our fees. You will be surprised how many non MNC clients have actually worked out very well with us. To be very honest, there has been only one instance of a cut where we just went and adjusted our fee downwards,” says Mehta.
Building the Agency Brand
“Agencies are primarily in the brand building business and I fear we have for too long de-prioritized the building of our own brands i.e the agency brand. However Personality PR is not the same as agency marketing,” opines George.
In India typically personalities take over an agency brand if one exists and it is common for an agency to be known by the personality of its creative leader.
“Having great or strong personalities in an agency is a great asset. It can be your biggest advantage. That’s still not a substitute to having an agency brand. In the long term, if you’re not able to utilize the strength of the personalities to build the strength of the agency brand, then you are doing disservice to the personalities as well,” feels Mehta.
Going Global with a marketing role …
Quite interestingly the success of creating a marketing role in India has led to replicated by the agency globally with the appointment of Naomi Troni, as Global Chief Marketing Officer. Clearly, the agency does not believe in wasting time.