big billing blues

MOHAMMED KHAN
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Chairman - Enterprise Nexus

a few years ago, one of our largest Clients in Delhi called to give me some very bad news, the kind of news every agency dreads. We were told, regretfully of course, that we were being fired.
When you’ve been in the business as long as I have, you are usually prepared when something like this is going to happen. But this just didn’t make any sense. Our work was spectacular, even if I say so myself. The lead brand was a huge success, doubling its turnover (and doubling the adspend) every year for six years. In fact, I’d like to believe that it set a new benchmark in food advertising. The other two brands we handled were also unqualified successes.
The Marketing Director who called was an old friend and had just taken over. So I said I needed to understand what was going on and we met in Delhi a couple of days later. “You see Mohammed it’s like this,” he explained. “Our Consultants (one of those Big Guns) have said that we have too many agencies (they had seven) and we must rationalise.” Four Agencies just had to go.
Good advice. Perfectly understandable. The question was which four?

Advertising is still new to us and many clients are not advertising-savvy. It’s like the consumer who’s buying a car for the first time.Or it could be a cake of soap. He doesn’t know which brand to buy

“We have decided to consolidate our business with our three largest agencies,” he told me. Not three of their best mind you, three of their largest. I just told him one thing. “It’s a good thing your consumer doesn’t think the same way because if he did, you’d be out of business tomorrow morning.” The Company in question was by no stretch of the imagination anywhere close to being No 1 in that category, but by God, were they giving the Big Boys a run for their money!
It’s the age-old story. Big vs Good
When I was starting my agency, I had not an iota of as doubt as to what it should be.
And since I wanted everyone who was going to be a part of this agency to share this view and work towards that end, I wrote a ‘Foreword’ that encapsulated that philosophy:
“There are, I believe, only two criteria for judging the performance of an advertising agency. One: its success as a producer of advertising. And two: its success as a profitable business venture”.
It was my experience that taught me this.
For me, the advertising business is about the work. It was always about the work. But, as I learnt the hard way at my brief stint in MCM that even being the best isn’t good enough if you don’t make money. Even so, we were obsessed with growth and wanted to be the biggest. But we were even more obsessed with being the best. The agency went down the tube in spite of being both big as well as the best. Because, while it made tons of money for its clients it did
not make money for itself. Eventually, it was of no value to
anyone.
My experience in Contract in the 80s was quite different. Here was a small agency that used to win half a truckload of awards each year. More interestingly, it was probably the most profitable agency at that time. I remember one particular year when Rajan, the Accounts Chief, came running down the corridor screaming, “Mohammed, what have you done?” I had apparently committed the unforgivable sin of making almost as much profit as HTA, the agency which owned Contract, was approximately 20 times its size and was India’s largest agency.
Clearly, just being big for the sake of being big is not where it’s at. In fact, the advantages of being small and beautiful were never clearer or dearer to me than my days in Contract. But don’t get me wrong. It’s neither a case of sour grapes nor my aversion to being big. We would love to be bigger than anyone else, but not if it means diluting the quality of work, or indeed, diluting all the other things I believe in.
Now O&M is a case in point. Here was a big, middle-of-the road (yawn) agency chugging along happily and then wham! The Kapoor-Pandey act got going. To start something small and beautiful with a team of three or four stars is one thing. To wake up and turn around a slumbering giant with a cast of hundreds who are used to another way of life is quite another. Suddenly, the skies opened up and we were bombarded with some of the best advertising we had ever seen. Clients started lining up. Everyone wanted a piece of the action. It was a spectacular show.
The moral of the story is simple. If you want to be big, fine, but learn to be good first. Like I said, this business is all about the work.
The big problem, I think, is with perceptions. As we never tire of saying in this business “perception is the only reality.” And as it’s with brands and companies, so it is with ad agencies. Perceptions differ. And perceptions can be terribly wrong. For instance, take the recent image survey on agencies published by Brand Equity a few months ago. This was presumably carried out amongst clients. Now if you were to conduct the same survey amongst people in the industry, you’d get a very different picture. Not completely different, but very different.
The question is, if this business is all about the work, why this preoccupation with size? Why the mad rush for billings? Why are agencies willing to do almost anything
to grow?
First of all, if you don’t grow, you’re dead. But there’s a more important reason. Advertising is still new to us and many clients are not advertising-savvy. It’s like the consumer who’s buying a car for the first time. Or it could be a cake of soap. He doesn’t know which brand to buy. He doesn’t know what to expect from that brand. He has no point of reference, no knowledge of that category. What would he do?
He would do precisely what you or I would do. He would look for safety in numbers. He would look to see what other people, preferably people he knows, are buying. He would base his buying decision on the expertise, or in the absence of that, the choice of others. It’s the ‘if it’s good enough for all those people it’s good enough for me’ syndrome. That is precisely how ‘India’s largest selling...’ works.
India’s largest agencies (with one exception, I must emphatically add) will draw exactly this kind of buyer. It looks like there is no dearth of these.
On the other hand, a guy who knows cars will decide on which car to buy based on his own knowledge of cars. He will buy the car that suits his needs best. The more evolved the consumer, the more evolved is his choice. This is true whether he is buying a Ferrari or an advertising agency.
Indeed, Ferrari is not the world’s biggest manufacturer of cars, Hilditch & Key are not the world’s largest shirt-makers (in fact, they just have the one shop in Jermyn Street), Vacheron Constantin is not the world’s largest-selling watch (not by any stretch of the imagination), Neutrogena is not the world’s largest-selling soap and la Prairee (as I have learnt at my own expense) is not the world’s largest-selling skin cream. But you get the picture. In every single category you can imagine, you’ll find providers of excellence, and you will find the ‘big players’ who may offer good value, stability or whatever, but seldom excellence. Not never. Seldom.
And hey, look at it this way. If you want to tell your grandchildren about the most memorable meal of your life, will it be the dinner at La Colombe d’Or in St Paul de Vence or the burger you had at McDonald’s down the road?
P.S. Dinner bookings now open.

TURNING POINT

"It takes courage to be creative. Just as soon as you have a new idea, you are a minority of one."

E Paul Torrance, Father of Creativity

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