In the year 2021, it will critical for ad agencies to be adaptable and flexible to the new environment for their success, says Rohit Ohri, Group Chairman and CEO of FCB India.
Ohri said agencies have to adapt to the new environment, pivot to their core and look at new opportunities and deliver to those, adding this is the best time to reinvent and recast the model.
Creativity, he said, remains a big focus for the agency in 2021. In the lockdown, FCB India quickly built skills and capabilities seeing that the digital ecosystem had completely taken over the consumer paths to purchase. The agency did partnerships with Networkbay in the retail and XP&D in the experiential space.
Ohri said in the time of crisis, creativity is the most valuable asset a brand can have. To look at in this new environment and find more creative connections with the consumer is of prime importance.
“We are looking at double-digit growth figures for sure but what end of the double-digit we are going to be is really the key question,” said Ohri. FCB India is on track to achieve the target of around 40% of the total revenue from digital in the next three years.
Ohri said in the last two months, the demand has bounced back and it's not pent up one. He hopes that with vaccines around the corner, things will improve a lot. “The forward outlook is looking quite positive and I am hoping that from Q II in 2021, we are going to be back to normal.”
First of all, congratulations! You were recently honoured as India’s Inspirational Leader 2020 in Advertising by WCRC’s Inspirational Brands & Leaders. How challenging has it been to be a leader in these unprecedented times? Would you call it the most challenging period among the various leadership roles you’ve held in your professional life?
The Covid period has been a test of leadership for sure. Yes, personally, it's been a very challenging time to lead the agency through a completely unprecedented black swan event. However, interestingly it has given me great leadership lessons in this period and how to manage situations, by looking at the positive side.
One big learning during this period for me is that I have managed to see leaders emerge in the organisations and one can see who their true next level extraordinary leaders are. Covid-19 has put the lights on the leaders of tomorrow who hold the capability to take the organisation forward.
Other learning has been, managing within constraints. The true test of leaders is when they manage to work and deliver optimally with lots of constraints. It's like being trapped in a desert with very limited resources like limited water and food but you have to get across to the other side and how do you do that? This sparks off innovation, new thinking and re-casting of existing models. In many forms, from a leadership perspective, this has been a great opportunity to reshape organisations, structures, way of working and I think that has been truly valuable as well. They say when there's a storm in the sea, the fishermen don’t go out into the sea rather spend that time repairing the nest. For us, repairing the nest is about relooking at how we work, what we deliver, the challenges this current environment has thrown up and how the agency is geared to match that.
How did the pandemic impact the agency’s growth? How have you planned to fulfil the agency’s unmet targets of 2020?
In the initial months of lockdown, business suffered a lot because many of our clients had to shut down their factories during that time. For large agencies, it has been a mixed bag because we work across so many different clients and categories. There have been some pockets where the business has been extraordinarily good and some pockets where the business has been severely impacted.
Luckily for us, many of our clients have done well in the lockdown period and even after the unlocking. Some bits have been good, and some have been patchy but overall we are not meeting our revenue targets, but I am happy to see that in the last one/ two months, the demand has bounced back and it's not just a pent up one. This bounce-back of demand is very heartening for us and we are hoping that with vaccines around the corner, things will improve a lot going forward. So, the forward outlook is looking quite positive and I am hoping that from Q II in 2021, we are going to be back to normal.
As a matter of fact, there are certain categories that have done really well. As WFH has become an important part of life, it has led to a lot of home improvement. Categories like home decor, buying electronics, furniture, kitchen appliances have found new wings and reasons to be there.
In these times, consumers are looking at small joys, small ways in which they can feel normalcy. Thus, they are going back to buy some of the things they enjoyed, truly liked and slowly getting back to the sense of normalcy. For example, we work with Dominos and the brand was severely impacted during the lockdown and now their demand has bounced back completely.
How has the recovery been in the festive season?
This time the festive season was a multi-layered cake because of the IPL. Usually what happens is that the IPL and the festive season is separated into two halves of the year and the spends are divided into two big bursts. However, this time with the festive season and IPL overlapping, there was a good uptick of spends where we see demand become steady and is now building up.
What we saw during the pandemic was that the automobile industry was the most affected. But we are seeing a bounce-back in the automotive industry as well. Many two-wheelers and four-wheeler brands have made a strong comeback. It’s because consumers have realised that personal mobility is critical because of the unpredictably of the current pandemic situation. As consumers empower themselves by being atmanirbhar, the automobile is one segment that has seen a remarkable bounce-back. For many manufacturers, this is a golden period. Though they could not make up revenue and profits in the first four months of lockdown due to lack of business, now they are seeing a strong comeback.
Another segment that’s doing really well is technology. With all the hardware, software, e-commerce, medicines, and packaged foods being online, the segment has grown very much during the lockdown because suddenly people are buying things online which they never bought before.
What is the overall growth that you are expecting in 2021, and what’s your strategy to achieve that? What will be the focus areas for the upcoming year?
Most of the companies and IPG group included have been cautiously optimistic about what we can deliver in 2021. We definitely are looking at double-digit growth figures for sure but what end of the double-digit is really the key question.
From the fact that demand has really come back, we are quite hopeful that we will be able to get some strong growth back again in 2021. That’s the overall hope; and obviously, the strategy that one needs to take into consideration is to understand the opportunities in the pandemic. For example, we at FCB understand that the digital ecosystem has completely taken over the consumer paths to purchase. So, understanding that and finding the opportunities in that is critical to achieving our growth in 2021. Very clearly, there are new ways and methods that we need to apply. We need to quickly build those skills as we did at FCB with our partnerships with Networkbay in the retail space and with XP&D experiential space.
The pandemic situation has been so sudden because of which a lot of the trends that we thought would hit India in the next five to 10 years, have collapsed in the last six months. There have been dramatic changes in the way certain categories are bought and consumed. This actually is the great opportunity for agencies to quickly work through either collaborations or new partnerships or acquisitions to build these skills very quickly and deliver to clients through tech and digital, new services that serve the market in its current scenario.
Our focus areas for 2021 will be centred round the philosophy of never losing focus from the core. When there is so much volatility all around, it's very important to refresh and hold and stick to what is core to the agency. For us that’s creativity and that is something I want to keep focused on. We have had a great run for the past three years now on producing the best work across agencies in India. Even in 2020, we have seen FCB India has been the No. 1 Agency at One Show and D&AD. We were recently awarded Agency of The Year by Campaign Asia. There has been a steady growth and we have upped our game significantly.
In the time of crisis, creativity is the most valuable asset a brand can have. To look at in this new environment and find more creative connections with the consumer is of prime importance. At any point, I don’t want to get distracted by the surrounding noise. Creativity stays as a big focus for us.
The other big focus is about to be agile and adaptable to new environments. What are the new things and how quickly can we bring these new capabilities for our clients? Like we did with Networkbay as we mark day 1 for retail because of the whole new situation that we’re in, by launching Retail: Day 1. The other partnership with XP&D that enables to move offline brand experiences to online by recreating the virtual environment. And at the digital front, we have our partner Kinnect, the number 1 digital agency in India. We have actually built all the new capabilities very rapidly to partner with our clients through this uncertain phase.
The third area of focus for us is on people and culture. This is the other big thing that is under strain because WFH worked well in the first three-four months. But if it’s the long term way of working, it requires new thinking of keeping people motivated and keeping teams together when they are not sitting and working together.
In a creative business, it is very important to have brainstorming and joint problem solving; creativity is not a systematic process there is a bit of chaos in it which comes from a lot of face-to-face interactions. Culture is not in the walls of an organisation, it’s in its people. How do you re-create some of that magic that produces the best work in a WFH environment and that is really one big challenge for us and that is something we need to focus on when we evolve into a hybrid work from office or from WFH mode and how to build and protect the agency’s culture in this scenario where people are not together.
We have been thinking of using the office environment for all the collaborative work we have to do. In a mindful and safe way, we plan to create a hybrid way of working where we get the people to come to the office after we change the office structure where people can work, collaborate, have more meetings and then go back home and do their individual work. Because it's of no use if people come to the office, sit in their rooms and do virtual meetings. The role of work from office needs to evolve.
How did the pandemic impact agency-client relationships?
Largely the pandemic has refreshed the client-agency relationship in many ways. Because right now, the clients are seeing the big challenges they are facing and the partnership of agencies to help them face those challenges. Most client-agency relationships, the way we look at it is really about when the cookie crumbles, that is really when you need to stand shoulder to shoulder, work with the clients and deliver for them. Heavy client-focused is actually heightened at this time and that has really worked well.
From an industry perspective, what I am seeing is that due to so much uncertainty all around, clients prefer not to destabilise their existing relationships right now. Most of the sensible marketers are using this approach of continuing with the current agencies. On the other hand, big pitches are happening as well and agencies are quite well occupied with that. But largely, partnerships have become stronger during the pandemic.
What would you term as the significant achievements of the agency in 2020? How are you planning to raise the bar in the coming year?
People and product have been our achievement this year. The most significant achievement for us at FCB is the fact that we have delivered for our clients at the creative front. At the recently concluded award shows, we did really well. It's a true testimony to a great agency if its entire agency is highly motivated. The pandemic is a long haul, for everyone it’s a new working environment which is challenging and puts pressure mentally. Despite everything, how the agency has come together shows how the agency has got deep roots and a very strong culture. Any agency that doesn’t have this would fall apart. If you build the agency right, which has a strong foundation and deep roots, it weathers the storm quite easily. That’s been our biggest achievement which proves the agency can weather any storm.
We are truly proud of being a No.1 Indian agency in D&AD and One Show. The No. 2 Hottest Agency at Campaign Brief Asia rankings and Agency of The Year at Campaign Asia Agency of The Year Awards. We were also the most awarded agency at Kyoorius this year. This has been a great year of accolades.
Raising the bar is something we have been doing consistently every year. In 2018 we won the first gold at Cannes Lions and since then we have been winning every year. We have set targets and we have achieved them. One has to keep moving, you can’t be static. Going forward, we will be pushing new heights of creative excellence and the other thing that we are going to look at is, how to recast our way of working in order to be ready for this new world and the new way.
In an interaction with BestMediaInfo.com last year, you said that the agency is aiming to expand its digital business with the hope of getting 50% of the total revenue from it in the next three years. How has the progress been towards that front? Has the pandemic fastened the progress?
The pandemic has increased clients’ focus on digital revenue and a lot of spends are shifting to digital and it’s a good boost for us. We are on track to achieve this target of around 40% of the total revenue from digital in the next three years.
The progress has been very strong. Clients have increased their budget on digital. Many clients have even moved 100% of their budgets to digital. This has been fuelling digital growth. And we are lucky to have the skills and capabilities to build and take advantage of this. This is another big focus area for us.
According to you, what are the things that will help shape the Indian advertising and marketing industry in 2021?
In 2021, the ability of agencies to be adaptable and flexible to the new environment is the most critical for their success. How do they adapt to this environment, how do they pivot to their core and look at new opportunities and deliver to those? To my mind, this is the best time for agencies to reinvent themselves and recast the model.
Globally and in India, we saw a merger between creative and tech, performance-driven agencies. Is it going to be followed by other advertising agencies? Can we say it is an agency model of the future?
Quite honestly these are developments and I am not sure whether they are strategic mergers or are they mergers of two entities that are not performing well individually and got merged to cut costs.
I see it as a more convenient move than a strategic one and it seemed quite apparent. That being said, at the same time, most companies are looking at building these new capabilities and moving forward.
Were there any layoffs and salary cuts during these unfortunate times? Is the agency looking to hire people? If yes, then in what positions.
We have had no salary cuts at all. The board in India has taken a salary cut but we haven’t pushed it down to our people. There were no layoffs either.
In these trying times, the people who work for you need assurance of safety. I have seen anxiety and fear across the industry and honestly, that negative demon kills creativity. In a creative business, you need to give people a sense of security, make them feel that they are safe so that’s the time when the mind can fly. Fear is not the key in creating and that is my ultimate mantra. It’s a pressure that leaves no creativity in the mind.
There is a total freeze on recruitment right now globally, but when we see some big tailwinds behind the fortune of our clients’ brands, then we will.