The Hindu Business Line : Adding to it

Ad agencies areextending strategicplanning functions tocomplement clientcompanies' marketingfunctions. Will it reallyadd value or is it onlya cosmetic change?

WITH pressure mounting on advertising to deliver, today it is all about making the brands work for their owners. Accountability on delivery is something clients are increasingly looking for and better brand management skills are required to give additional value to the client's brand and business challenges. Advertising agencies are now looking closely at their account or strategic planning function and redefining its role for the sake of their clients.

While the focus has always been on the consumer in order to add value to the client's brands and strategy, Rediffusion DY & R took a big leap forward recently to offer a brand new service in the area of strategic market planning to its existing clients.

According to Santosh Sood, Chief Operating Officer, Rediffusion DY&R, "The new service being provided will be an extension of the existing marketing services of our clients whereby we will be offering our cross-category learnings for sizing up market opportunities."

Working in tandem with the marketing departments of its existing clients, Rediff's strategic market planning services would be an integrated product offering from the agency and are not expected to replace the existing marketing functions of companies. Explains Sood, "With our cross-category exposure we would help marketers in taking decisions. We would help them leverage the relevant market segments with a package in place which would involve mathematical and statistical data."

The strategic market planning service will have Kartik Iyer as its head. Iyer moves from Initiative Media after serving more than nine years with the Lintas group and will be based in Delhi, from where the service will be offered to all clients across all the agency's branches.

K. Subramanian, Director, (Planning), Rediffusion DY &R

Besides, Rediff's existing planning team headed by its Director (Planning), K. Subramanian, would also be involved in the new venture. According to Subramanian, "While the strategic market planning team would identify new consumers, we would provide the insights into the new consumer, taking it to the next level."

The new service is expected to enrich the planning portfolio of the agency which already has its proprietary tool, Brand Asset Valuator, for understanding brands and consumers.

The trend of agencies offering strategic marketing services is a relatively new one in India. As Sood says, "It is still a grey area and there may be a few agencies doing it. Companies hire the services of an independent marketing consultant in most cases." Explaining the extended services of his agency, Sood says, "Clients usually approach us with a brief but now we will be involved with the brief itself." Looking at a new stream of communication, Rediff DY&R is expected to help its existing clients in evolving categories such as telecom to help define and identify new consumers. It has big-ticket accounts such as Airtel, Colgate, Citibank, Godfrey Philips and ING Vysya. On this growing trend of planners getting into marketing managers' shoes, a senior member of the strategic planning team at Lowe says, "Today's planners belong to the marketing manager's team. They just happen to sit at the advertising agency. Marketers, in fact, expect them to perform the role of the brand custodian."

Rohit Srivastava, National Planning Director, Contract Advertising

Besides, such marketing services may not be limited to the emerging categories alone. Observes Rohit Srivastava, National Planning Director, Contract Advertising: "Well, they certainly do for emerging categories but I'd say they are even more critical in older, well-established categories. That's because typically they are overcrowded, parity is rampant, growth has slowed down and hence brands face huge problems when trying to drive differentiation and get higher price realisation. So the need and hence the search for variables that can drive category expansion or brand shifts is even more. In fact, emerging categories have an easier time in that sense because category growth is steep, there is new interest in the category and the marketplace is still fluid."

Prabhakar Mundkur, Business Development Director, JWT

At the same time, there are conflicting situations arising out of this consumer-centric approach, which may result in both the agency and its client being at loggerheads with each other. "Typically, the client says `my product,' the account director says `my client,' the creative director says `my ad.' The account planner, by saying `my consumer,' provided a crucial bridge in this whole client-agency interaction on advertising. If the account planner works too closely with marketing managers, there would be a tendency for the planner to say `my product' as well, which is not the best for the development of advertising. Increasingly, creative people want strategy that is well digested and easy to understand which only the planner can do. Working too closely with clients could jeopardise this important role of providing imaginative fodder for creative people," warns Prabhakar Mundkur, Business Development Director, JWT.

M. G. Parameswaran, Executive Director, FCB Ulka

Besides, there are also brand consultancies being floated by agencies such as FCB Ulka's Cogito Consulting and Contract's Core Consulting, which have been trying to add value to the marketing and branding functions of clients. Explaining this growing trend of consulting divisions within agencies, M. G. Parameswaran, Executive Director, FCB Ulka, says: "Agencies started off as brand consultants. But over the last 50 years, their role in all things other than advertising has been reduced due to several developments such as the rise of the marketing function in organisations, rise of marketing research as a science, the growth of consultants, and so on. Client pressure to reduce agency compensation has seen a rapid decline of several `think' departments in many agency networks. The growth of the brand consulting practice is a result of all the above trends. There are today a few agencies with a thriving planning culture and a core team of planners. These skills can be leveraged to serve client needs better, as a separate standalone division."

Extended consultancy services beginning as an offshoot of strategic planning functions is also being viewed as a trend heralding additional revenues for ad agencies. Says Mundkur, "I think planning departments have the capabilities to be brand consultants. By moving planning into consultancy mode, it becomes a revenue centre for the agency instead of its traditional role where it is a cost centre. This is the reason for it to be a growing trend."

It is still early days for brand consultancies and the debate continues as to how much value they can add to the clients' branding and marketing needs. Elaborates Contract's Srivastava, "These are early days but it will increasingly become fashionable to talk about such initiatives. But whether they add value to the clients' businesses or not will really depend on whether they are able to build competencies and successful case studies that can demonstrably deliver business results. To my mind, the acid tests are: First, is the consulting company or division attracting non-agency clients or merely adding value to the agency clients, and second, is it delivering price realisation that's better than the conventional agency businesses? Not to mention whether it has proprietary tools, processes that have been tested successfully. If not, it's probably old wine in a new bottle, which is traditional account planning being presented with an image makeover! But if the answers to the above are positive, it probably means the consulting firm is creating and delivering value to its clients. As someone said, nobody pays good money for bad coffee!"

Suman Srivastava, Executive Director, Euro RSCG

So while a communications strategy is distinct from a marketing strategy, agencies should also decide whether they want to stick to their core competencies. For instance, whether advertising agencies are in a position to understand issues such as distribution or pricing and whether they can actually help in solving their clients' marketing issues remains debatable. At the same time, increased specialisation in the marketing/branding arena seems to indicate a slow trend of unbundling of such services within the advertising industry. As Suman Srivastava, Executive Director, Euro RSCG, claims, "Strategic planners have always been adding value to the client's marketing needs. The difference now is that agencies are charging for it as a separate service instead of bundling it with advertising and this seems to be the trend of the future."

Mundkur at JWT has the last word on the subject. Says he, "I think what David Ogilvy said to clients about the creative function is equally true of the planning function. He said, "Do not compete with your agency in the creative area. Why keep a dog and bark yourself?" The Account Planning Group in the UK, when it wrote its millennium definition for account planning, said that it would have to fulfil the following roles: Market Researcher, Data Analyst, Moderator, Information Centre, Bad Cop, New Product Development Consultant, Brainstorming Facilitator, Soothsayer, Communications Planner, Strategist, Brief Writer and Think Piece Author. As you can see they left out the specific word `marketing'!"

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