'Ad sector will see a double digit growth this year '

Insearchindia.com's interview with Havas Media India & South Asia CEO Anita Nayyar

'Ad sector will see a double digit growth this year '

Posted on 24 July 2010


As the advertising industry prepares to come out of the slowdown
clutter, Havas Media has found proper representation in India's
two high-growth sectors: telecom and automobiles.

While Maxx Mobiles came into the fold in 2009, the big catch this
year has been Hyundai.

Havas has almost 50 per cent of its revenues coming from the top
five clients - Reckitt Benckiser, Jockey, Bank of Baroda,
Max Mobiles and MTS. With Hyundai falling into the net, the top
six are in a position to power the media agency's growth story in
India.

Havas will stay Delhi and Mumbai focussed while posting slow growth
from its three southern offices - Bangalore, Chennai and Hyderabad.

The big push will come from its integrated funtions - sports, digital
and out-of-home.

In an interview with Insearchindia.com's Anindita, Havas Media India
& South Asia CEO Anita Nayyar speaks about her company's growth plans
at large.

Excerpts:


How has the first half of the year fared for MPG India?
We are on track as far as revenues and billings are concerned.
On a percentage basis, we have met out targets quite in line with
last year and the growth has come from both existing and new businesses.
While our existing clients have fared better for us this year, the
new businesses have also helped in pumping up the growth.

But are you implying that 2010 has been similar to 2009 in terms of
growth?
Yes. We won MTS and Maxx Mobiles last year and Hyundai this year,
all large and prestigious clients. And both telecom/handsets and
automobiles are considered as categories doing well with minimal
recessionary impact. We also won Dixcy, News X and M3M this year.

As far as revenues are concerned, which clients and categories are
the largest contributors?
We have a client list that is upwards of 50 and across categories
which include FMCG, telecom, automobiles, banking, mobile hand sets,
beauty and wellness, media and real estate. About 40-50 per cent of
our revenues come from our top five clients - Reckitt Benckiser,
Jockey, Bank of Baroda, Maxx Mobiles and MTS.

What are your expectations for 2010?
We foresee a decent growth in 2010, given that 2009 was a recessionary
year. Percentage growth in our integrated functions - sports, digital,
and out-of-home - will be better as margins in offline business
is pretty low.

But has not out-of-home taken a hit this year?
I don't think so. In fact, out-of-home has been doing very well for
our clients and though it has not increased dramatically, it has surely
not taken a dip.

'About 40-50 per cent of our revenues come from our top five clients
- Reckitt Benckiser, Jockey, Bank of Baroda, Maxx Mobiles and MTS'


Which are the geographical areas that show potential in terms of
advertising?
As far as we are concerned, we have five offices across India -
Delhi, Mumbai, Bangalore, Hyderabad and Chennai and we expect our
growth to come in primarily from Delhi and Mumbai. Growth from
the southern market is slow for us.

Overall, from the consumer's point of view, the potential surely
lies in the semi-urban and rural areas.

How are the other divisions faring - Havas Sports & Ent,
Media Contacts and MPG active?
All three are doing well and on an upswing. Havas Sports took up
interesting projects during IPL like the strategic sponsorship deal
and the Dhoni endorsement with Max. We are in the process of finalising
some more deals. Digital is seeing an interesting growth and Media
Contacts is en cashing on the situation. MPG Active has been in the news for executing interesting campaigns including the one on INQ Mobiles where they executed the country's tallest billboard.

How do you predict the 2010 advertising scenario to be like?
We should hit double digit growth in 2010. It should be somewhere in
the region of 10-12 per cent, though the pace is a bit slow.

According to Tam, the first half of the year has seen a 36 per cent
rise in TV ad volumes. Revenue, however, is not growing at the same
speed. Why?
There is too much of a fragmentation today and this is making it
difficult to attract the consumer. There are multiple touch points
today to capture consumer attention and you never know when and
where the consumer will spot the advertisement. And though the
ad volumes are increasing, we are not seeing much increase in ad rates.

How much of a change has recession brought into the functioning
methods of an advertising strategy?
When recession's not around, we tend to work more liberally.
However, recession always teaches businesses
to get more from less and our business is no exception. This time
around, it taught us to keep a tight watch on our purse string.
It told us that we can do with lesser inputs, work, people and
resources. Also, while there was a bit of retrenchment as far as
our industry is concerned, it was more about not giving increments
during the period.

Which advertising platform is expected to show the maximum growth?
Digital for sure. This is because the medium is progressing towards
accountability and efficiency. The platform is seeing about 40 per cent
growth year-on-year as advertisers are increasingly getting into the
digital and media space.