The Hindu Business Line : "We have been very effective"

Catalyst speaks to Meenakshi Madhvani, Managing Partner, Spatial Access Solutions, the country's first media audit firm, now in its third year of operations.

Two years ago, Spatial Access Solutions (SAS) was floated as India's first media audit company. Founded by Meenakshi Madhvani, SAS has today grown to an 18-member team, helping its clients get more bang for their buck. Its clients include some of the top advertisers across sectors as diverse as FMCG, automobiles, paints, insurance, healthcare, beverages and consumer durables.

Since inception, SAS has audited over Rs 700 crore of media spend. Positioned as a media management consultancy, its aim is to enhance marketing communications' effectiveness and efficiencies through media auditing, benchmarking, research and mix optimisation. In a freewheeling interview with Catalyst, Madhvani outlines some of the challenges she faced in the process of getting the industry used to the idea of media audits.

It's been two years since SAS came into being. Do you think you have been effective in measuring the efficiencies of media-buying agencies? How have your clients benefited compared to the time when media audits did not exist?

SAS completed its second anniversary on October 13, 2005. We have a strong client focus and given our competencies, we have constantly strived to eliminate the guesswork from our clients' investment in advertising media.

Our basic services include evaluation services (media planning, media-buying implementation and process audits), assessment services (media pitch management, contract & fees and performance appraisal systems) and Print Production Monitor. Our consulting services are highly specialised and cover brand impact audits. In addition, we will be shortly launching a PR audit service.

We are not in the business of comparing efficiencies of media-buying agencies. We maintain a client focus and to that extent, we have been very effective in driving greater efficiencies, in terms of planning and buying, for our clients.

In the days before media audits gained acceptance, advertisers did not have the benefit of an unbiased and objective third-party validation of their media strategy and investments. While the concept of using an independent media auditor took some time to seed, we find that more clients are now aware of the concept and call us to know how a media audit exercise will help them. Often, potential clients speak to our existing clients and once they are assured of the benefits, they sign us on.

It is believed that SAS is in attendance while media-buying agencies pitch to clients. Has this arrangement created hostility between SAS and the agencies? Are they ready to be audited by an external body?

Yes, SAS participates in media pitches made to the client. So far, SAS has been involved in the evaluation of seven media pitches, and there are another three in the pipeline. As media strategy and investments are presented by the agencies being evaluated, it is important that SAS is involved right from the start.

Are agencies hostile to SAS' involvement?

Initially they were, but that is a wall that is slowly crumbling. Agencies understand that SAS' role is not in favouring one agency over another but to provide the client an unbiased and objective report of which media agency's strategy and involvement will work best in helping the client achieve its objectives. Having said that, every pitch will have at least two losers and there is bound to be a reaction at times.

We understand and respect a media agency's professional abilities and integrity. An SAS audit benefits the media agency as well, especially in terms of improved interaction with the client. In certain cases, it helps the agency address shortcomings in its internal processes and in cases where we do an audit and find little scope for improvement, it reflects well on the agency.

In the UK, almost 70 per cent of media spending is audited, while in the US it is about 7 per cent. What is the status in India? How are your operations growing, considering media is undergoing so many changes, of late?

SAS is defining the media audit space in the country. So far, SAS has audited approximately Rs 700 crore of the national ad spend. Depending on what you consider to be the national ad spend, SAS has audited 6-8 per cent of the total ad spend. Our operations are growing at a staggering rate. We have doubled our staff in the last one year. We have consolidated our core service offerings and are now offering specialised services in the area of brand impact audits.

We have been pleasantly surprised by the advertiser response to the Print Production Monitor. PPM enables a price advantage by analysing an advertiser's print production spends. This is an area that most clients know little about and don't know whom to ask. Other new offerings include audits in the space of public relations, events and below-the-line activities.

There is a thin line between auditing and consulting. Would you have crossed this line at times, considering you have positioned yourself as a media management consultancy as well?

The response would differ depending on your interpretation of `media management consultancy' — macro-media strategy decisions or micro-media tactical decisions. We certainly refrain from the latter as this gets into the planning space and hence contradicts our stance as auditors. However, our specialised tools allow for a broader view of how communication fits into the marketing scheme of things for an advertiser; that's an area that complements the audit space and that's what we treat as media management consultancy.

We also help advertisers ask the questions that they need answers for to set the right goals and objectives for their media activity. Typically, advertisers and their agencies continue to do what has been done in the past simply because of historical convenience. Our consultancy service helps them address the right issues. The implementation of the solutions and the media perspective on those solutions will continue to come from the media planning and buying agency. Therefore, there is no conflict.

What are the industries you think need media audits more than the others? How effective would they be?

The biggest change over the last two years is that more advertisers are aware that a media audit service exists and more are eager to understand how it can help them. Media agencies, though, have been slower to recognise the benefits of a media audit and though there are some pockets of resistance, there are signs that this too is changing fast. As I said earlier, SAS has audited approximately Rs 700 crore worth of ad spend. In addition to working with local advertisers, SAS also audits local spends of some global advertisers by virtue of its affiliations with international media audit firms. SAS' client list spans industries. Media audits are not restricted to any category of advertisers because a media audit helps each advertiser better their media ROI. However, the stakes get bigger if the advertiser exists in a highly competitive environment and has a sizeable media spend. That's when a media audit becomes essential.

Do you think external agencies such as TAM and aMap are doing their job right? Considering MRUC (Media Research Users' Council) has decided to take up cudgels on behalf of the media industry to drive more meaning and depth into audience measurement methods, do media audits take into account the current lack of authenticity in data?

Considering that the entire industry works with the same data, "lack of authenticity" is a strong term to use. There are shortcomings and till such time that a universally acceptable solution is found, advertisers, agencies and SAS will use the current data and make judgements based on experience and skills. SAS too works with industry data. We differ from agencies in our approach and use of proprietary software. However, whenever we work with clients and their media specialist agencies, there is complete agreement on the data used and the assumptions made. This ensures everyone is on the same plane.

Just for the record, MRUC is not against any data service provider. It wants to work with the existing system to improve the quality of data that is provided. MRUC will bring its considerable expertise and interactions with users to ensure that the industry data sources are acceptable to the majority of advertisers.

Certain corporates find mass media a waste. Considering a company such as Raymond has stayed away from television for the past couple of years (for its readymade garment brands like Park Avenue, Parx), do you think this makes business sense in today's fragmented media environment?

The communication objectives decide which media, mass or niche or direct-to-consumer, need to be used. Without knowing a client's specific communication objectives it would not be correct to comment on their media strategy. Today, we have clients with a better understanding of media; we have research that tracks brand awareness in addition to viewership and readership data and we have advanced software that allow us to map any variable against another. This empowers clients and their agency to take considered decisions.

Media-buying today seems to be all about chasing better prices. Do you think these discounts serve any purpose for clients who are believed to end up paying more money?

Discounts for the sake of discounts serve no purpose. We always evaluate the value rather than just the price of the buy. There is no point in buying efficiently at the cost of effectiveness; there needs to be a balance between the two. We recommend that clients focus on planning and strategy as their primary requirements. When it comes to buying, if a client develops a strong value focus, he will stand to gain. Buying cheap only helps media owners offload their zero value inventories. Ultimately, an obsession with cost has a negative impact on quality.

Are there multiple media audit firms in other markets? Would you say you have the first-mover advantage in setting standards in the media industry?

Europe is a hotbed of the media-auditing sphere and supports multiple audit firms. In India, we enjoy the first-mover advantage and are setting the standards for the media audits industry. That is something to be proud of but it also puts a tremendous responsibility on us to set the right benchmarks. By constantly innovating and expanding our scope of services, we are quite sure of staying ahead of any competition, should it arise.

In India, while media-buying has become consolidated, the number of media owners and channels has multiplied. In this scattered and fragmented scenario, how easy or difficult is it for a media audit firm like yours to operate?

Once again, I must take you to the client focus that we have. The consolidation of media-buying does not affect the audit service. The multiplicity of media, though, always makes the job of the advertiser, planner, buyer and auditor that much more challenging.

What about your own bottomline and turnover? Are you a profitable entity? Is it easy getting clients to subscribe to media audits?

Without revealing the actuals, I must tell you that the bottomline looks good. From the start, we were confident of the service offering. However, the first year was a challenging experience as we had to educate clients as well as face resistance from media agencies. However, at the end of two years, the concept has been well accepted, media agencies are less resistant and we are a profitable entity. We must add that clients, once convinced of the benefits of a media audit, have signed SAS on and in most cases renewed their partnership for an extended period. From the feedback we have, SAS today is synonymous with media auditing. That, to us, is really encouraging.

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