Clients have to realise that if they pay peanuts, they will get monkeys: Abhik Santara

Abhik Santara, CEO of Atom Network, wishes that the ad industry should immediately cease the commodification of the business.

“We should stop taking ourselves for granted and evolve, yes evolve, to become sexy again. Some of us are doing a huge disservice to our industry by falling into this trap of encouraging and tolerating mediocrity. And by celebrating every mediocre person, we end up setting the wrong benchmark for deserving people, ” he added.

Santara believes that people who remain tentative about advertising even after spending 2-3 years should refrain from continuing in advertising, and the industry shouldn't encourage it any other way because of our short-term interests.

In an exclusive interview with BestMediaInfo.com, Santara emphasised that clients have to realise that if they pay peanuts, they will get monkeys. “Sindoor ke budget mein holi nahi khel sakte – atleast for long. Let's also pray that the national elections can easily dwarf the impending signals of global recession affecting India,” he stated.

Calling 2023 a correction year, Santara shared that Atom Network has taken a conscious to work for brands where it has a larger, longer and more responsible role to play.

“We had invested in quality talent across strategy, creative and business, and client partnerships where we could contribute substantially in the long run,” he commented.

Excerpts:

Could you provide details about Atom Network's performance in 2023? Specifically, I'm interested in understanding the extent of revenue growth compared to the previous year, 2022.

The year 2023 has been below expectations in terms of our growth projections for ^ a t o m and for the overall industry as well. The best barometer to measure the spirit of the industry is to see the volume of top-quality work. How many IPL or World Cup ads do we remember from last year? The number will be quite less. In absolute terms, we had a single-digit growth, but w.r.t to 2022, it is less.

The year before, there was a sudden rise of D2C brands, and we managed to deliver projects which were quick in and out and came with limited responsibility. Not necessarily all of them had contributed to our creative glory or given us the satisfaction of brand growth. But those projects delivered better margins. However, that is not a sustainable business model, and in the middle of 2023, we took a conscious call to go after brands where we have larger, longer and more responsible roles to play. It also meant that we could invest in quality people rather than hiring to manage businesses for quick money. We had invested in quality talent across strategy, creative and business, and client partnerships where we could contribute substantially in the long run. In a way, it was a correction year for us, and we pivoted to a slightly different model of building the agency further. By the end of 2023, we started to see our OP margins getting better.

2024 is a year that comes after four years. So the wishes and expectations have to be special. What are those expectations both on individual and industry levels from 2024?

I don't think one extra day makes it any special. Our industry is notorious for waking up and working only at the 11th hour of the deadline. But jokes aside, 2024 – is the year of the Dragon. Time to rise, spread our wings and start breathing fire I reckon. Ideas are our currency, and this year, our ambition is to create our best work to date.

As an agency, we hope to build from the measures we have undertaken in the latter half of 2023. We realise that only passionate people can produce great work and only great work can bring value and glory to our business, not the volume. In 2024, we will further resist this temptation to add businesses that can only be profitable if managed in volume, as that approach is detrimental to our agency roadmap and culture.

I wish, as an agency and part of the industry, we could stop the commodification of our business. We should stop taking ourselves for granted and evolve, yes evolve, to become sexy again. It's a job which is easier said than done. However, if we stay patient and create a team with a shared passion for our business, 2024 will be a turnaround year for the industry. People who remain tentative about advertising even after spending 2-3 years should refrain from continuing in advertising, and we shouldn't encourage it any other way because of our short-term interests.

The other change I expect is from the clients in 2024. Clients have to realise that if they pay peanuts, they will get monkeys. Sindoor ke budget mein holi nahi khel sakte – atleast for long.

Let's also pray that the national elections can easily dwarf the impending signals of global recession affecting India.

We are caught in a vicious circle. We have shrinking margins, cut-throat competition and a limited talent pool. So, how does one stay afloat? By hiring reasonably okay talent, by doing reasonably okay work and by earning reasonably okay margins. Some of us are doing a huge disservice to our industry by falling into this trap of encouraging and tolerating mediocrity. And by celebrating every mediocre person, we end up setting the wrong benchmark for deserving people. There are limited budgets, and that should be distributed disproportionately in favour of high-quality talent. Giving a 30% increment to only deserving people is better than distributing 5% to the entire office.

2024 is a year of consolidation for us, having taken corrective steps in 2023, we are committed to improving the quality of our business. And that will be addressed at every level in the team and every interaction – the quality of client-facing people, the passion in our output even for the tiniest social media post, the rigour in our research work and the depth of our involvement by the leadership team, all of it are taken many notches up. We may have to take some short-term hits, and that's okay. The people who have the talent will flourish, and the lazy or tentative ones will fall out. And that's okay, too.

Going independent is a very big decision. How has it impacted your career? Have you noticed any discernible changes in the way brands engage with you now?

It is a very tough game, but a very satisfying one indeed. There is no one to blame except yourself. One has to take tough decisions every day and own it. The cushion of a network and fixed salary allows you to just stay afloat in the boat without making tough and unpopular decisions because there is always a mythical villain in the region. One can always play the victim card and survive. That is not the case in independent setups. I see myself as a completely new person with loads of resilience, courage and hunger to evolve daily. We are not just accountable for the agency, but also for the families of our people, and the future talent that will join this industry. It is important that we seek and more importantly, reflect reality.

Brands expect independent agencies to be nimble and innovative at a supersonic speed. Fair enough. But when some brand starts to exploit these qualities, they become unreasonable in their demands (“ Yeh toh kuch bhi karenge”) and eventually fail to derive value out of quality people.

But those who know how to harness the real benefits of working with an independent agency end up getting the best out of the passion of every team member. The smart clients know they should not pay for the people who will show up once a year but pay for those who have proven credentials and yet will sit on weekly job list meetings and put their passion into every single output. If that is not value, then what is?

Why did Atom launch a separate consulting division?

The industry model is designed to cost for the final output, i.e. the creative product. Strategy is given free, experience is handed out free. If you look at the SOW of various businesses, clients have stopped appreciating and paying for the journey. Therefore, there needs to be more talent who can put the rigour and help develop great creative work. There are enough and more things that an agency does to create a great brand, and they are demanded free as dhaniya with the bhaaji.

Advertising agencies have the reputation of bundling services or offering backtracked strategies in the pursuit of great creative work. But whether it is a D2C business or a business wanting to scale to new geographies or customer segments need a host of insightful, repeatable, trainable, coachable interventions that are sustainable, rational and logical. And classical agency models don't try to look at business growth from a holistic point of view. As a result, there needs to be more clarity between the priorities of an advertising agency and the real marketing ask that any business has. ^ a t o m consult sits at the beginning of this model and can deliver through-the-line solutions. Advertising is just a part of it.

Do you think the era of big ideas will never return in the times of always-on? Also, is it good or bad?

In a run to stay visible all the time, brands are missing the boat on deeper connections, especially the new age brands. The fundamental role of branding is to make consumers feel in a certain way when they consider or use you. Across many categories, brands are losing that sheen. There may be an increase in spot awareness, but unless there is a discount, consumers have 50 other options to choose from and all of them are reasonably known. How is that a sustainable business model? If we look at how the ratio of spending on performance v/s brand work has changed in 2023, one can easily predict the future of such an approach.

We must also realise that it is humanely impossible to produce great work daily. Even David Ogilvy couldn't have. We should be reasonable enough, along with our client partners, to choose our battles right and not put unnecessary pressure on creative thinkers daily. We should be okay if the wish post for “International Second Cousin Day” is not the most earth-shattering one. Similarly, we should not settle for anything less than producing at least one great piece of work every week which can go into our portfolio.

Marketing used to be led by the top guy in a client office, in the last few years that role has been relegated to managers who are more concerned with meeting everyday KPIs. "Zomato jaisa kuch kartein hai" is their only contribution to a brief. But that is changing, and changing fast on the back of shirking margins and the inability of brands to charge a premium from its customers on a sustained basis. As business leaders, it is a time to smell the coffee, own and invest time in the most important function of marketing, i.e. advertising.

It is not the first time advertising has seen the upsurge of new mediums, tools, formats, and platforms. This isn't a setback for creative industries but an opportunity. The key lies not in the tools themselves but in their use. In an era where access to technology is democratised, the true differentiator is skill and insight. The most creative and insightful minds will stand out like skilled samurais with the same katana. This is an exhilarating time for creatives, as the expanded toolkit challenges them to innovate and resonate more deeply. In this landscape, it's not just about possessing the tools; it's about mastering them in unique and impactful ways.

Info@BestMediaInfo.com