Advertisers now position media agencies upstream from creative agencies
Remember Surf's Lalitaji campaign or the Liril girl campaign? These were two of the landmark campaigns in Indian advertising history, which till date have top-of-the-mind recall. Lintas (now Lowe) was the advertising agency that conceptualised and executed both campaigns. They did the creative and the copy. They identified and procured media space. The creative, production and media buying were all done in-house.
In those days, an ad agency (now creative agency) was the maestro of all corporate communication plans. It took care of the creative, planning, buying and client servicing. The business was profitable. The agencies would get a 15 per cent discount on the ad rates from publications as their commission on their client's media billing.
That was then. The agencies had to plan and buy for the two television channels, Doordarshan and Doordarshan Metro, and a handful of national dailies and magazines. Media options were limited. Planners were the kings and buying was a back office work.
In those days, recalls Paulomi Dhawan, vice president, media and corporate communications, Raymond, "Mahabharata would have a phenomenal 80 per cent viewership. Media planning and determining the right levels of reach and frequency was straightforward."
Today there are 100 channels and dozens of newspapers and magazines. Radio has taken a new avatar as FM and outdoors has acquired a new meaning. Advertisers have realised that movie theatres are an effective and quantifiable medium to reach large audiences. The internet has emerged a popular medium amongst financial sector advertisers.
With audience fragmentation and media opportunities came complexity. No longer did it remain a simple mathematical exercise of how many spots an advertiser wanted to buy on Chitrahaar and Mahabharat. Media planning and buying became multifaceted, requiring access to research and support of software tools. The process, naturally, unmanageable for the generalists, moved to specialists.
Today, media agencies play a major role in deciding the communication strategy of their clients. They don't just buy media for them. Now, they contribute from building a strategy to executing it. The crux lies in their expertise, as media buying veteran P R P Nair, senior advisor, Media Direction, puts it, "in stretching the ad rupee to yield maximum value to the client."
Ad spends (Rs118 billion) in 2004
Source: Adex India, a division of TAM
The 180o turnaround
Advertisers now place media agencies upstream from creative agencies as they find them better qualified to determine their communication budget allocation. Media agencies have specialised units to identify and quantify factors driving sales and brand awareness. They work on the RoI (return on investment) for each campaign and account.
Media managers present their clients with a complete communication plan, based on research, and brief the creative agency. To top it all, they are on the factual and rational wavelength of the clients in contrast with the aesthetic and psychological orientation of the creative directors.
Media agencies also have the expertise in understanding and using media opportunities to the optimum. They have the proficiency to evaluate media offers in terms of rates, availability and competitor activities. They use tools to study consumer perception and media consumption patterns and determine the efficiency of the media vehicle and media type to be used for a campaign.
Media agencies are the new specialists. They strategise, negotiate for clients and act as regulators for media vendors. So, how does a media agency function?
Typically, these agencies use quantitative studies - syndicated and proprietary - and specialised tools to gain consumer insights. These insights are not just demographic but behavioural and attitudinal as well. Based on the analysis the agencies work on a communication and creative strategy, decide on the media to use, give inputs to the creative team and decide on the creative executions along with vehicles and schedules.
Then comes the tactical implementation, placing, for instance, the 100cc colour print ad or a 20 second commercial or a 10 second jingle, where they were planned. This calls for negotiating skills so that each ad rupee yields maximum return on investment.
Media buying agencies do not buy in bulk first and then sell retail to their clients. Manish Porwal, executive director, India-west, Starcom clarifies, "We decide what we need for our clients and then buy it so that our holding something, doesn't go into influencing our decisions in what the client should buy."
What the agencies do, however, is to bundle together their buying (for various clients) to reap economies of scale. The clients don't mind. They understand it is not about buying media at the cheapest values or rates but about the value being provided.
The economy is growing, the market is buoyant and the mood amongst companies is upbeat. The Indian market promises tremendous scope for media buying. As Pradeep Iyengar, vice president (west and south) puts it, "We are still talking nascent buying here, we are still not talking farming models." He adds: "In India, we are investing client's monies. Till such a time as you are investing a client's money and buying on his behalf on a regular basis, there is only this much you can do."
Buying here is still in a flux, as it is in the Asia-Pacific market. In the not so distant future expect Indian agencies to harness tools and processes (already being used in mature markets like Europe) to deliver better value to clients. Media lexicon:
Agency of record. An agency appointed to buy media for all brands that a company owns.
Television rating point. A time-weighted average of time people spend watching a show.
Gross rating point. The total rating points that a network or channel offers used to look at money spent versus what you get from it
Cost per rating point A measure of buying efficiency
Cost per milli. Cost per thousand impression of a banner served online.
A device installed in television sets, which communicates with the satellite receivers and captures and measures television viewing.
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