The Hindu Business Line : The Government and advertising

Why cannot the Government dream of a mega-sized public sector advertising agency that understands the needs of the market, attracts the finest talent and uses the latest methods to deliver advertising that works, asks the writer.

A RECENT news item mentioned something to the effect that the Finance Ministry was instructing public sector undertakings, specifically banks, to route their advertising through the Directorate of Advertising and Visual Publicity (DAVP).

I believe the time is ripe to put this entire issue in perspective. Let me begin by stating that this column does not seek to delve into the realms of whether the Government should run banks, insurance companies, airlines, duty-free shops, telecom companies and the like. I accept the reality that it does.

Stepping back a little, it is important to examine Government advertising in totality.

There are advertisements released by Departments of the Government, Ministries of the Government and undertakings owned by the Government.

Let's first take up the departments and ministries.

With some exceptions (like the campaign to create awareness about consumer rights), most advertising that emanates from these sources can be called informative announcements. So you have the Railway Ministry announcing the inauguration of a new rail link or the Ministry of Shipping announcing, say, the Sethusamudram Project, or the Department of Information of a State outlining the achievements of the Government on completion of a hundred days, or something similar. There could also be several Government advertisements remembering national leaders, national and State causes and so on.

Many of the advertisements that emanate from Departments are released by the DAVP. Some of these advertisements are even created by the DAVP.

For those who might be younger than me (a majority are, today), the DAVP is essentially supposed to be the advertising agency of the Government of India. A somewhat similar though smaller parallel can be seen in States which have what is called a DIPR, which could be loosely called the State equivalent of the DAVP.

A walk down memory lane provides us with the background in which these entities probably came into being. This was obviously the time when the Government made forays into every sphere of activity — from hotels and airlines to steel companies and public utilities. India was young and the public sector probably did provide an impetus in areas where private enterprises either did not think it was profitable enough to operate, or where the Government felt, for reasons best known to it, the need for the public sector.

Typically, because of the procedures mandated to the public sector, even a hi-tech organisation like, say, ISRO or the Department of Atomic Energy (just random examples) would have to issue advertisements to seek tenders and the like. These were of a statutory nature, and understanding that many companies might not have the necessary means to produce these advertisements and the knowledge of media to release them, the DAVP probably filled in as a useful single window organisation that could handle these simple advertising requirements.

The DAVP would use the muscle of a large advertising spend behind it to fix rates and in the early days many publishers actually felt that some advertising from the Government, like Union Public Service Commission releases, were of actual reader interest and so accepted the lower rates of the DAVP. Being in a very positive mood, one will not go into how the DAVP selected media, how much time it took to settle bills of publishers and such disconcerting issues that are generally expected when dealing with the Government.

Incidentally, the DAVP was then authorised to actually accredit advertising agencies which needed this certification to handle the advertising of PSUs.

Now we come to the PSUs themselves. Obviously, if the DAVP could accredit private advertising agencies to handle the advertising of these undertakings, there was obviously a need felt to allow these private agencies to function in the public sector space. In those days, none of the erstwhile multinational agencies would be accredited by the DAVP. The nationalist spirit probably encouraged PSUs to use the services of purely Indian advertising agencies.

Nationalised banks, which were wedded to implementing the social objectives of the Government, formed a body called the Joint Publicity Committee (JPC) that would empanel private agencies to create common advertising for the banks. Remember, the public sector banks were cooperating not competing with one another. And profit was not essential.

A new world

Everything has changed. Multinationals are back in India with a bang. The DAVP does not accredit agencies anymore. Profit is not just a good word, it is expected. Companies, private or public, are operating in a relatively free market environment. The Government (whichever Government it is) basically expects productivity and performance from its undertakings. The JPC died a natural death. Banks are encouraged to be a part of a dynamic competitive market place and reflect the needs of the consumer, not the policies of the Government.

The private sector has been allowed to come into almost every preserve of the public sector. Therefore you have a crowded telecom scenario where fierce battles are being fought for market supremacy. Battles that are being waged with weapons like customer orientation, technological superiority and pricing mechanisms.

The same scenario exists in the skies above us. The private sector has been encouraged to step in and companies like Indian Airlines are literally battling for their existence. The same is the case in the insurance sector. The monolithic LIC has a host of private players nipping at its heels. Banking is no different. The HDFCs, ICICIs and HSBCs of this world are proving to be doughty competition to the large public sector banks.

The point to note is that whether it is the petroleum sector or the power sector, private players are legitimately active. The public sector has to fight the perception game against formidable players in the private sector.

Who do you think the Finance Ministry itself leaned upon to communicate its messages about schemes such as the Voluntary Disclosure of Income Scheme? The DAVP? No! The Finance Ministry in its wisdom relied on the creative and planning skills of two multinational advertising agencies. We will not go into the reasons why they did this.

We will, however, emphatically state that when we say everything has changed, we include national demographics as well as the technology used by advertising agencies. Also, the media scenario itself that has become so complex and one can see the emergence of a more aware and demanding customer.

All this requires expertise. Expertise in strategic planning, sound knowledge of mass communication, a thorough understanding of the dynamics of market research and an appreciation of consumer insights.

We are not restricting this to an argument for or against the use of DAVP for public sector banks. We are widening the focus of this debate.

The need of the hour is to equip the public sector with the tools it needs to be effective in today's dynamic scenario. This means it needs qualified and dedicated personnel in the area of marketing to oversee its communication strategies. Most PSUs depute a good engineer or a sound accountant or a great banker to oversee the marketing plans. They do not even possess qualified marketing personnel on their rolls though they have multi-crore advertising budgets. I reject the argument that they cannot attract fine marketing talent. Look at petroleum companies. The erstwhile marketing director of BPCL was from IIM Ahmedabad. The company still has highly qualified and experienced marketing people handling the relevant jobs. This is just one example to prove that the public sector can attract top talent, if they believe it is necessary.

Only after this comes the point whether they should use DAVP or private sector advertising agencies.

I am not trying to build a case for advertising agencies or against the DAVP. I am an Indian first and only then an advertising agency professional. It is important to honestly enquire whether DAVP has the relevant talent with the contemporary expertise necessary to strategise and execute advertising that can make a difference. Its fabled media-buying clout needs to be closely examined under the light of the complexities that modern media planning demands today. The media market is much more than a mandi where just haggling or browbeating is sufficient to ensure financial effectiveness. Wouldn't it be a good idea to transform DAVP into a really large and effective Indian advertising agency?

Think about it. State Bank of India is a huge public sector bank. ONGC and BPCL are massive public sector undertakings, LIC is an enormous public sector insurance company. All these companies are greatly respected in the marketplace. Their mega size or their ownership pattern does not make them any less effective. Why then cannot we dare to dream of a mega-sized public sector advertising agency that understands the needs of the market, attracts the finest talent and uses the latest methods to deliver advertising that works? Why can't Government also insist on properly qualified or trained personnel within its PSUs to handle the important and challenging task of marketing?

I submit that this should be the goal of the Government if it truly believes in the public sector.

The alternative that is being suggested by the Finance Ministry today would make public sector banks and any public sector companies enter the modern day battlefield with hands tied behind their backs, shackled feet and a blindfold on. The result would not be difficult to predict.

(The author heads Canco Advertising.)

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