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Publicis looking at doubling its size in India every three years, says CEO Steve King

Livemint:  June 19, 2017

New Delhi: After taking over as global chief executive of Publicis Media in January 2016, Steve King visited India between 7-9 June to evaluate the media business and better understand the market’s potential. As a Publicis Groupe veteran with over three decades of experience, King has seen media agencies evolve over the years. His larger focus is to turn Publicis Media into a data- and technology-driven firm which does more than just media buying and selling. “We have this asset in digital arm Sapient with over 10,000 people that we plan to leverage,” King said in an interview. Edited excerpts:

In the last one year, Publicis Groupe has launched Publicis Media, restructured senior leadership, launched innovation hub Drugstore in India and unveiled the group’s transformation board. What is the message you are sending out?

About 18 months ago in San Francisco, Maurice Levy (former Publicis chief executive) and I invited new disruptive companies like home-rental platform Airbnb, ride-hailing app Uber along with big firms and investors for a management meeting. The meeting helped us understand that the way we are running our business is not relevant for the future. Therefore, we decided to reorganize Publicis Groupe in four solution hubs (communications, media, healthcare and digital business Sapient), introduce leadership change where only one leader will represent Publicis Media in each market and create differentiation in our media agency brands.

We had way too many P&Ls (profit and loss) and silo businesses; they are the death of the collaborations. It has paid off—as of the first quarter of this year, we are the most successful holding company in terms of media wins, retention and revenues etc.

What is the position India holds for Publicis Groupe globally?

In terms of ad expenditure, China is the largest market in APAC (Asia-Pacific) region but India is our focus market in terms of potential. We will leverage the assets developed in this market globally. The way consulting and outsourcing firm Accenture Plc and IT firm Capgemini SE rely on India for talent, we are going to do the same. In the last four years, India has been in our top five markets in terms of growth as it continues to grow on the back of strong GDP (gross domestic product), growing middle-class, globalization, digitization and a strong growth in local businesses. Publicis Media India currently contributes nearly $1 billion in billings and is ranked number two agency in the APAC region as per global media agency rating firm RECMA’s (Research Company Evaluating the Media Agencies globally) 2016 yearly report.

How is the India market different from other global markets?

Variation from the norm is more exaggerated in India than any other market, for instance a growing print market. I also think infrastructure (both physical and digital) and access to talent is another big challenge in the country.

Any interesting advertising media trends in the India market?

Following the global trend, I think video content consumption continues to soar in India. Users are watching over a billion hours of content daily on YouTube globally with 80% of watch time coming from mobile. Personalized content which tells authentic stories will win consumer attention. Brands and agency partners have to collect meaningful consumer data to create personalized experiences. Sixty-three percent of Indian consumers are comfortable sharing their personal data with brands they engage with.

Mobile will continue to dominate the consumer and advertiser interest. India is expected to overtake the US as the second-largest smartphone market next year. Currently, while over 245 million Americans own smartphone, there are over 220 million smartphone users in India. Clearly, mobile will overtake desktop to become the primary internet ad medium this year. Therefore, mobile marketing will continue to grow as consumers search and buy on the go.

There will be growth in augmented reality (AR) and virtual reality (VR) which allow brands to create new experiences. In India, I suspect approximately 50% of businesses will adopt virtual and augmented reality by 2017. Artificial intelligence and machine learning will also make their way into everyday devices and behaviours.

What is your target for the India market?

We are looking at doubling our size every three years in India.

What kind of challenges do media agencies face today and what are they doing to stay relevant?

Honestly, I have more experience running a media agency than anybody else. I started Zenith Optimedia (now a part of Publicis Groupe) 29 years ago as an executional business (media buying) but over the years the agency has evolved to become a strategic partner for clients. Our biggest challenge is how do we find, retain and train different talent. We are hiring code writers, social listening experts, content managers etc. We are looking for curious, collaborative and passionate talent who not only understand consumers but also know how to engage with them via technology. Publicis also runs a training programme where we hire graduates from STEM (science, technology, engineering and mathematics) background and train them in the content and analytic space.

Data continues to be a big focus area for media agencies. Do you plan to make any strategic acquisitions in the data and technology space?

When it comes to data and technology, we are not only competing against the players in the media ecosystem like WPP (GroupM), IPG Mediabrands and Madison Media but also with Google, Facebook, tech giants, management consultancies and clients building their own platforms. So, this space is intensely competitive but we already have our digital firm Sapient as an asset which we are amplifying. There are no immediate plans of acquisitions.

Ad fraud continues to be a major issue for media agencies. How is Publicis Media maintaining trust among its clients?

We are at the forefront of rigorous brand safety, viewability and verification standards and protocols for working with media owners. Publicis Media has integrations with leading third-party verification vendors; for instance we are involved with Facebook’s Measurement Council. Apart from Publicis Groupe-verified vetting, the agency also uses tools which helps campaign managers to weed out bot fraud by removing inventory sources with low rates of viewability.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.