Publicis Groupe is investing heavily in growth and India has been one of the biggest focus areas of the company’s growth ambitions. For the company’s Global COO Jean-Yves Naouri, the target is clear: to double the size of its operations in India between 2010 and 2015...
we are committed to India - it is not unusual for audiences in India to be reading or listening to such statements on multiple occasions from various companies. Despite all conversations of slowdown and an unpredictable economy, India continues to be an attractive market for anyone who is constantly looking at ways of growing their business and tapping newer markets. It would hence be fair to say that it is commonplace for global holding companies to tom-tom plans of following the marketer and expanding their Indian operations. So, when Publicis Groupe reiterated its intention and commitment towards India in 2010 and said that it would double its operations in the country by 2015, for many, it was what everyone else was saying.
It took the company two short years to showcase that not only is it determined to grow its India operations, but has an elaborate plan to achieve the aggressive target it had set out for itself. The guiding principle that Jean-Yves Naouri, Chief Operating Officer, Publicis Groupe has put in place is based on a very simple philosophy – adopt a holistic approach that enables a client to communicate in a consistent manner across all his touch points: from employees to shareholders to consumers. The way to do this was to invest in various disciplines including the likes of public relations and healthcare. While Publicis Groupe busied itself in following this, the big question was whether the growth of its mainline agency brands – Publicis Worldwide, Saatchi & Saatchi, Starcom MediaVest Group and others was as per expectations or stagnated?
THE ‘NOT SATISFIED’ SYNDROME
Naouri does not shy away from stating that Publicis Groupe’s leadership – that includes Group Chairman Maurice Levy and Naouri himself – is very demanding on their expectations from Publicis Groupe operations across markets. “I don’t know if I can ever turn around and say that yes, I am satisfied with what we have achieved. But I can tell you that we are very pleased with the progress we are making in India to be able to achieve our target,” says Naouri. Agencies such as Leo Burnett India have posted growth figures and Publicis Worldwide has managed its own too. From an industry point, Saatchi & Saatchi has some significant catching up to do. The agency saw a change in leadership in late 2011, when Matt Seddon came on board the company as its CEO. Naouri states that the companies are doing well though they “can do better”. The other agency many are watching out for is Starcom MediaVest Group (SMG) that recently lost CVL Srinivas to GroupM. The agency has decided not to replace the role of the agency’s Chairman and CR Mallikarjunadas is leading SMG as its CEO. The year has gone well for ZenithOptimedia that under the leadership of Satyajit Sen as CEO not only managed to retain some of its biggest clients such as Nestle and Reckitt Benckiser, but also added a few new businesses to its kitty. However, the impact and strength of VivaKi is yet to be seen in its full potential in India. Like GroupM, VivaKi Exchange too consolidates buying for Publicis Groupe’s media agencies. Where the so-called mainline agencies have been busy in keeping their revenues on target, Publicis Groupe has also been busy in adding strength to new verticals at a group level and agency level.
UNPRECEDENTED FOCUS ON NEW VERTICALS
“PR, Events and Healthcare, in addition to Digital, have been very strong areas of focus for us. You can see what we have done in PR to ensure leadership position for MSL Group in India,” says Naouri as he traces back steps the company has taken to adopt a holistic approach where Publicis Groupe identified PR as a core part of its overall plan. The route to strengthen its PR expertise saw quite a few acquisitions -- the key one dating as early as 2007, when Publicis Groupe announced its decision to acquire Hanmer & Partners. The company was christened Hanmer MSL, bringing Publicis’ global PR brand MSL to India. After that, it was only in 2010 that Publicis Groupe acquired a majority stake in PR and marketing communications firm 20:20 Media and social media consulting firm 20:20 Social to diversify MSL Group’s offerings in India. In late 2012, Publicis consolidated all this to become MSL Group India that includes two national agencies – MSL India and 20:20 MSL and two specialty offerings -- 20:20 Social and MSLGroup Creative+.
In a bid to strengthen itself in strategic healthcare communications, in 2011, Publicis Groupe acquired a majority stake in Mumbai-based healthcare advertising agency Watermelon Healthcare Communications. The entity that becomes part of Publicis Healthcare Communication Group (PHCG) is renamed to Publicis Life Brands Watermelon. The move marked PHCG’s expansion in India.
An interesting acquisition from the company was marketing consultancy firm MarketGate that too is operating within Publicis Worldwide. The operative word for Publicis Groupe in the last couple of years, which was then reflected in its actions as well, was holistic.
THE HOLISTIC APPROACH
“We are perhaps amongst the very first ones to look at all areas that strengthen the presence of our clients’ brands. What one needs to understand is that you are not talking to consumers or shareholders or employees, you are talking to people. We are amongst the very first who treat the communication to people in an all-encompassing manner. There is a need for close convergence of all messages through different assets,” explains Naouri as he outlines the thought behind adopting a holistic approach.
He adds, “Whether it is a consumer, shareholder, union or an employee, you are talking to a person and we have to make sure the message is consistent. Hence, we believe in organizing and orchestrating a holistic approach to communication. We see situations where messages conveyed by a company are not coordinated enough and people immediately see the difference. Some find it outrageous as to how people sometimes communicate with employees and shareholders. We see more such cases come up and become an area of concern for our clients. Hence the approach we have taken is relevant and would be more so in the times to come.”
It is this approach that has led Publicis Groupe to deep dive into specialized skillsets across its agency brands, and in the process add more talent to each discipline.
Publicis Groupe’s digital strategy is as much individual agency brand aligned as it is about developing the expertise at an overall group level. Where it was establishing brand Digitas in India on the one hand, on the other hand, its agency brands such as ZenithOptimedia, Starcom MediaVest Group, Leo Burnett India, Publicis Worldwide and Saatchi & Saatchi were also developing in-house digital talent. But in 2011, Publicis Groupe decided to add more. Consequently, it acquired and aligned Resultrix to Performics under the ZenithOptimedia umbrella. Indigo was bought and aligned to Leo Burnett India that already had Arc Worldwide and iStrat was added to Publicis Worldwide under the agency’s digital offering Publicis Modem. Naouri elaborates that the thought process was to augment the digital offering from these agencies.
In the case of Saatchi & Saatchi, he divulges that for now the agency looks to develop its digital expertise in-house and Publicis Groupe’s endeavour is to support the agency in getting the right talent to manage this.
Reiterating the Group’s overall thought process, Naouri sums up, “Our commitment to India is not only to add expertise at a Group level but also to help the individual agency brands to increase their revenues. Our target to double our operations in India between 2010 and 2015 will come from a healthy mix of organic and inorganic growth of our agencies.” He hints that 2013 would be as busy for the agency as 2012 was – the deadline of doubling the size, which could arguably bring it closer to Interpublic Group (IPG) in India, is just two years away and the change should become more visible soon for Publicis Groupe to achieve its target. The year 2013 would, hence, become a critical year for the agency to achieve its targets.
‘In India, we will try and reach for the stars’
As the Chief Operating Officer of Publicis Groupe, Jean-Yves Naouri is second only to Maurice Levy in the leadership role he plays in the company. Naouri joined Publicis Groupe in 1993 as a founding partner of Publicis Consultants, a subsidiary specialized in strategic and corporate communications. Over the years, his responsibilities grew and included overseeing Publicis Healthcare Communications Group (since July 2008), as well as the Publicis Groupe Production Platforms (May 2009). In the two decades that he has spent with the company, more was added to Naouri’s plate. Some of the other designations adjoined with his name are Executive Chairman - Publicis Worldwide, Chairman - Publicis Groupe China, Member of the Publicis Groupe Executive Committee and Member of the Publicis Groupe Management Board (Directoire). Naouri’s thirst for growth put Publicis Groupe in many news headlines of acquisitions and Consolidation of operations in various markets. In this interview with IMPACT’s Noor Fathima Warsia, Naouri speaks on his vision for the group’s India operations and the road ahead.
Q] To double your size in a market such as India in just five years is a reasonably aggressive target – do you think that would help you become the No. 2 holding company in India?
I don’t think that at this stage, ranking is going to be very essential from our point of view. Our aim is to strengthen our position India. We have announced a while ago that we want to make India a clear area of focus and we wanted to double the size of our operations. We have done this in some of the other markets and we are committed to make it happen in India as well. We are focused right now to give enough power and resources to our agencies here for us to achieve this target figure.
Q] There are various conversations in the context of Publicis Groupe agencies in India. Has the growth been as per expectations?
Unfortunately for our agencies, I am very demanding. I can tell you that I am pleased to be here and with the progress we are making. But we want more. We are pushing for the next level of growth in India in a very concerted fashion and we are encouraging our teams to attain the goals that we have set for ourselves. This is part of inspiration – you should always try and reach for the stars and that is what we are trying to do in India right now.
Q] One route you have taken for that is acquisitions and some of your competition say that a few of the recent acquisitions in India were overpriced...
We are not known to overprice. Everyone has their own expectations and we will make sure that we do not let down people whom we want to partner. But Publicis Groupe is known to be extremely conservative. We are keen to bring the best talent because we want to make sure we anticipate our clients’ expectations. Talent is the key point for us when we look to acquire a company. But I must state here that there are multiple examples of situations even when competition has offered higher price to a company we want to acquire and the company’s management still wanted to join us and has aligned with us instead.
Q] You have acquired various companies in different domains in India. What are some of the other areas of growth we will see you in?
We have acquired companies in PR, Healthcare, Digital, Activation and we will continue to invest in multiple areas such as shopper marketing and so on. We will do everything else that is required to strengthen the presence of our clients’ brands. We are firm believers and early ones at that in a holistic approach to communication and you will see us investing in that direction.
Q] Are you in a position to give us some of your plans for 2013?
We have not yet finalized budgets and hence I cannot give a clear sense of the kind of commitment or target growth numbers. But on a broad note, our focus is our people. And we don’t have to motivate them because they are highly motivated and very aware of our long term target for India. They want to make sure they provide clients in India with the best service and our steps in 2013 too would be to support them in this endeavour.