The Hindu Business Line : An Xpansive plan

"Small-town challenges are fundamentally different from rural; the people are a curious combination of rural sensitivities and big-city aspirations," says Ravi Kiran, CEO-South Asia, of Starcom MediaVest Group.

STARCOM was set up in India in January 2000, when Procter & Gamble, one of Starcom's largest clients globally, consolidated its strategic communication planning for all its brands in India with the agency. Until then, P&G had not separated strategic planning from the creative services in any country. In July 2001, the media team of Ambience D'Arcy was merged with Starcom, resulting in the formation of Starcom Media Vest group. Besides its media-only clients, Starcom provides media strategy and investment services to the clients of three Publicis Groupe agencies: Leo Burnett, Ambience Publicis and Orchard.

Today, Starcom is spreading its wings and spearheading its new initiatives is Ravi Kiran, CEO-South Asia of Starcom MediaVest Group. Kiran started his career as an account management trainee in Lintas India and `defected' to media in 1996 when media functions were being treated as an independent entity.

Kiran's latest mission is to tap into the small towns in India through Starcom's new unit, Xpanse. Launched this month, Xpanse is expected to bridge the gap between metros and villages. The new unit has decided to deliver communication and marketing solutions suited to small towns and semi-urban areas of India. In an extensive chat with Catalyst, Kiran outlines what his new unit is all about and the changes sweeping across media today.

Why did the Starcom Media Vest Group decide to launch Xpanse now? Are clients demanding its services as they continue to spend more on mass media?

The launch of Xpanse is part of a bigger game plan. Until not long ago, in fact, till 2003, we used to excel largely in mainstream media. We did have a pioneering initiative in our digital offering since 2000 - Starcom Digital - but our focus was on financial clients. Then, in 2003, we gave ourselves a new five-year vision, which is `to be and to be recognised, as the most exciting business service organisation in India to work in and with.' This began changing the very way we looked at our future, both with regard to the kind of people we wanted to attract, train, and retain, as well as the way we aligned our services to evolving client opportunities and challenges and consumer usage of media.

In August 2003, during our annual conference, our core group managers froze on about a dozen new competencies that we needed to build. Most of the specialist disciplines we have today were part of that list, including rural marketing.

In my view, the timing is just right. Urban markets are stabilising across most product and service categories. More than ever, marketers see small towns and large villages as the next frontier.

We are entering at an inflexion point, at a time, when, I believe, the marketer interest is about to tip. Our clients are enthusiastic about these markets, although their demand from us might not be very vocal yet. We are happy to start just ahead of client demand, rather than react to it.

Is there going to be a difference between the creatives for the rural and the urban markets? In that case, how will you synergise your operations between the ad agencies you are affiliated to and your own media house?

We believe that the fundamental challenge in communication today is media; not creative. Media is the function that has increased dramatically in its complexity, while creative, both in conceptualisation and in execution, has remained relatively unchanged and simple. We need to remember that the creative message - what we say about our brands - is pretty much in our control, while the media consumers choose and how they use them is not, unlike the old, nostalgic days of Doordarshan. Today, we need to build creative to leverage real-world life and the media behaviour of our client's customers; not decide creative first and then look for media to expose that best. It goes without saying that creative and media need to work closer together than ever before, because that's how consumers look at it. They don't differentiate between just a pack shot on a wall, a dangler at the store-front and a TV commercial. What matters more to their decision-making process and their assimilation of the brand's message is how powerful and engaging it is when they have the time and willingness to see or hear the message.

As a media network, we excel only in media while our creative agency partners are terrific in creative. So if special creative is required for smaller geographies, and it might well be, then they will produce it for the brands, as they have always done. We will hopefully bring better understanding of what works in those markets and implement it. We will also help guide adaptation of mainstream creative, when required, for smaller places.

In what way is Xpanse going to be different from the services being offered by rural marketing outfits affiliated to other agencies such as Linterland (Lintas) and Ogilvy Outreach (O&M)?

When it comes to rural marketing, a lot of what the other players do and what we do might be similar; we just have to do it better, now that we have the advantage of getting the most experienced people on our side. This will partly be accomplished by the kind of people who join us, who are not all from a traditional rural marketing background - many are from client servicing, events, creative and so on.

The other thing we have realised from our early discussion with potential clients is that some of these set-ups (can't take names, obviously) have earned the industry a bit of bad name by grossly overcharging clients. Clients have discovered this in time and many of them have decided to drop rural marketing altogether or are trying to do it on their own.

We do not want to sell our service cheap, that's something Starcom has never learnt, but we do not want to fleece our clients either. Clients respect knowledge, creativity, and excellence in execution, but they are darn good at deciding the price at which they will stay committed for the long haul. Starcom has always prided itself on being honest and transparent with its clients, and we will continue following that principle even in Xpanse.

The other part of our offering, in fact, perhaps the more important part - small towns - is what makes Xpanse unique. I might be proven wrong, but I don't think any of the other companies has tried developing expertise in that. Small-town challenges are fundamentally different from rural, because small-town folk are more educated, more exposed to media, more ambitious, and, in fact, are a curious combination of rural sensitivities and big-city aspirations. As it happens, many people in small towns actually come from villages far and near and act as significant influencers of product and brand decisions in their respective villages.

We don't believe anyone has really unearthed small-town India in full. We have a hunch and we have some good people with a feel for that market.

Now we will investigate and unravel that market and that would hopefully be our biggest distinction.

Will you restrict your services in media strategy and investment to the three creative agencies Leo Burnett, Ambience Publicis and Orchard? Or do you intend functioning as an independent unit where you would service other clients?

A major part of our revenue in India comes from clients who are either partially aligned to our creative agencies or not at all. That is a reality. That will not change in a hurry. In fact, because we have our respective business goals, we are free to go our own way, although we collaborate wherever we can. Clients will choose us and retain us if and because we are good at what we do, not because of any alignments. In short, we will be open and willing to accept all clients whose thoughts match ours, who believe in long-term partnerships, in remunerating the partner well, in treating it with respect. There will be some exceptions such as Unilever or Johnson & Johnson whom we will not like to approach or handle, as they are P&G's rivals. P&G is very dear to us and has entrusted us with a lot of business in many markets including in India.

What kind of revenues do you expect from your new rural outfit? When do you expect to become profitable?

We have a revenue expectation but cannot reveal that. But more than revenue, the goal is to put in place the right people who will build a strongly differentiated business for tomorrow and to test our concept with like-minded clients. In our belief, revenue and profitability are outcomes of what you do and how well you do it, not goals in themselves.

Perhaps this is the advantage of being part of one of the largest companies in the world in our business; you don't have to worry about short-term survival. If we were a local, owner-managed company, I am sure things would be different.

What kind of advantages would you have from your existing units in the network such as StarSight (out-of-home and ambient media), Starcom Entertainment (entertainment and embedded marketing), Relay Worldwide (sports and cause-enabled marketing) and ACE (activation and media-supported amplification)? How would you exploit the synergies between these and Xpanse?

There are large synergies between all these disciplines. Xpanse as a small-town and rural solutions unit, for instance, can use our capabilities in out-of-home, entertainment (celebrities and events, used properly, can be a big draw in small towns) sports (think of district-level cricket, football, even kabaddi and kusti) in connecting with consumers. For instance, Relay is now intimately engaged in the over 70-year-old Kila Raipur Sports Festival in Punjab, popularly known as Rural Olympics, where nearly half a million village folks congregate over a four-day period to participate in rural sports. That's a unique combination of rural marketing and sports. Western Union, J. K. Tyre, Heinz and Zee Telefilms are major marketing partners in the event taking place this month.

There are three ways in which the synergy will be delivered. One, for Starcom clients, our mainstream planners will be carriers of the synergy. We are training them intensively this year in holistic planning, in order to achieve that. Two, singularity of leadership. As I am responsible for all these units, they cannot and will not work at cross-purposes. Three, and this is perhaps the most important part, they are all children of the same common vision, and we believe nothing delivers synergy better than a shared vision and an ego-less team.

Is Xpanse an India-specific initiative? Would you consider extending it to the SAARC countries where there might be a need for this kind of a service?

For the time being, it's only India. Do remember that for obvious reasons, this is the first such unit for us anywhere in the world. Once the Indian experiment is successful, the world could be our domain.

Why did you take so much trouble (roping in your agencies and even asking the media for names) to find the right name for the new brand - Xpanse? Just how important is a name while pitching for clients?

Many people in marketing underplay the importance of the brand name. It is true that there are examples of neutral names such as Pepsi, Kodak, even Nirma, which have been built to be large and powerful brands. It is also true that what you do is more important than the name. But to have a name that clearly communicates what you do and what you represent is always an advantage. Think Head & Shoulders, Whisper and Complan, and you will see the advantage.

That's why we conducted a fairly serious contest for the name. It was not trouble, if you ask me; it was fun. We got 80 names and out of a shortlist of half a dozen really powerful names, we chose Xpanse.

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