Agencies should try to follow an Asset Light Model: Sam Balsara

Saloni Surti
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Sam Balsara

Sam Balsara speaks about the dire talent crunch seen in the industry, sharing how agencies can prepare for the future as creative competition increases as the Indian A & M industry strives towards growth.

It has been a year of changes - good and bad. Sam Balsara, Chairman, Madison World and Jury Chair, Social Samosa 40 Under 40, sheds light on how competitive pressures faced by the agencies are leading to a dearth of talent and giving rise to newer management challenges. He speaks about how agencies can balance going forward, with details around the evolving AdSpends pie. 

Edited Excerpts: 

Having served on almost every Industry body in the country, what according to you are the biggest challenges plaguing the industry & what changes need to be brought about to overcome the same?

As the economy and the advertising industry get back its mojo, the talent crunch is once again hitting the industry like never before, especially in Digital. The biggest change and an unfortunate change I see is that at one time in the 70s, 80s, and even 90s agencies were able to hire students from top management institutes.

Today, given the competitive pressures, agency fees have reduced, and consequently, agency salary structures have not been able to keep pace with the growth in salaries in many other sectors. Advertisers are partly responsible for this. The savings they generate from a reduction in agency fees, I believe, is counterproductive. 

Whilst large and consistent advertisers understand the game, many small and medium advertisers led by a procurement orientation and no skin in the game have been the cause of this. I believe no entity that a manufacturer or a service provider deals with in today’s time delivers as much value as an agency does, in return for so little.

Another unfortunate development in recent times has been the debacle with TV ratings service BARC. This is really unfortunate that the Industry got featured on the front pages of national newspapers for the wrong reasons. But I am glad that the industry is coming together to put in place a robust, fair, and transparent mechanism to manage BARC.

The last 18 months have been life-changing, to say the least. What are some of the biggest learnings for you from this phase? 

The biggest learning is that anything can happen at any time with lasting consequences. You cannot take your revenue stream, leave alone growth for granted. One should hope for the best but be prepared for the worst. 

Try and follow an asset-light model. Use plug and play services as far as possible. Use outsourcing. At the same time remember the axiom, “Tough times don’t last, tough people, do”. 

One must also remember that there is no country better poised for growth than India is. So, one must be ready to take advantage of new opportunities that are unfolding every day.

Also Read: #SS40Under40: A look at the Jury Panel

From an AdSpends POV, did the festive season do justice? Would you say that we are back to the pre-pandemic levels? 

The festive season saw advertisers return to advertising with a vengeance. In Television, not only was there more spends by existing advertisers but there were over 20% new advertisers who entered TV.

A recent report by Ormax suggested that the India OTT universe has a 353mn big subscriber base. With OTT now getting bigger than ever, how are AdSpends for the medium changing? Do you see OTT AdSpends inflating further in 2022? 

OTT users are being added at a good pace but ad spend on OTT is still a fraction of TV and not consistent with the increase in user base. However, I do expect AdSpends in OTT substantially increasing next year.

Can you share a few AdSpends tips for brands that are new to the OTT universe? How should brands decide on the OTT budget & what will be the ideal RoI measurement parameters?  

I believe the most critical thing is to measure video viewership and not TV viewership and OTT exposures separately. I am glad at Madison Media we have developed a system that allows clients to see what their combined plan on TV and OTT delivers in terms of Reach and  OTS.

While things are getting better on the pandemic front, unpredictable volatility cannot be ruled out. Can you share a few tips on how to create financially agile agencies that stand strong during such tough times?   

The old-fashioned principle of CLIENT DELIGHT will always hold you in good stead, good times or bad times. Take interest in finding solutions for your clients in areas beyond advertising- new products, distribution, pricing, all areas related to marketing. Be transparent with clients, employees, and suppliers. Look for collaboration opportunities.

What would be your suggestions to the freshers who want to join and make a mark in the advertising and marketing industry? Any tips?

My advice to freshers would be to selflessly give their time and apply their focussed brainpower on the job and not worry about their rewards. In this context, I would urge youngsters to read the late Chandramouli Venkatesan’s first book “The Catalyst'' and not just read it but internalise its content. Also please read the second book “Getting better at getting better” and the third book which has just been launched, called “Transform” written by him in his last 4 months of illness.  If freshers take Mouli’s advice to heart they are assured of a  sterling career.

As the Jury Chair for #SS40Under40, what is the one thing you will be looking for in entries?

I would look for consistent application of the mind to meet the challenges of growing the Brand and succeeding.

Please share one message for all our participants

Advertising, Media, and Marketing are disciplines and functions that are going to grow by leaps and bounds in the coming decade in India. You are at the right place, at the right time. Make the most of it.