Seeing a lot of new money coming into the market: GroupM's APAC CEO

Two years after being named APAC CEO for GroupM, Ashutosh Srivastava visited India for the first time since taking on the new role. Storyboard18 caught up with Srivastava on the sidelines of his visit where he spoke about his outlook and expectations for the India market, how GroupM is working on a ‘Media Decarbonization Programme’, its efforts towards building talent infrastructure and more. Edited excerpts. Q. What is the purpose of your first visit to India after 27 months and what is on the agenda? The world has moved so much in these past 27 months, as has India. It is a really exciting time for us. There are a lot of new opportunities, new challenges. This visit is to see what is happening here. Where can we accelerate, what are the challenges to be overcome and spend time with people. Because ours is a people’s business. While MS Teams has been very good at keeping the functional communication going, there’s nothing like being with everyone and really seeing what’s going on.Q. How has the region and specifically the India market fared in the past two years?The first four to five months were really tough while the whole reset was being done. After that, we saw the demand for help on commerce, on organising data and implementing technology to create interesting consumer experiences for those who were stuck at home or had reduced mobility. These situations called for new solutions. The other fundamental dynamic that changed in the industry is the interest in people using technology and therefore the platforms to set up businesses using tech so that you can go directly to the consumers. Whether it is established brands or new businesses. What we are seeing is a lot of new money coming into the market. All of it has created a demand for our sector and the complexity is rising. For people like us that is a massive opportunity. There is a neutral independent planner who is sitting on the outside asking ‘shall I be spending this much on the platform X vs Y, what will give me a better end outcome, how do I get more accountability, and more. So there are 20 other levers of growth which we are finding to reduce the complexity. There are not enough people today to do this and therefore our only challenge is preparing a talent pool of people.Q. Creating a talent pool is one of the biggest challenges that agencies are facing today. How are you grappling with and managing the exodus of people from agencies to other sectors?There are only two ways in which we can do it. One is to simply beef up the entry-level program and go to more hunting grounds which means do more effective pipelining and expand the places from where you are hiring people. Second, what can we do to give them the foundational skills and get them to start doing the job well? And third is, of course, hiring from adjacent sectors like business services delivery companies such as Accenture, Cognizant and Wipro. And also the platforms (tech companies) themselves. Platforms hire from us but we also hire from the platforms. People do go there, learn certain skills because they also want to broaden their skills. It is a two-way traffic.Q. And what about talent retention? What are you doing to keep people? We will still have to cater to 25 to 30 percent attrition every year. Plus, the pipeline to build the new talent means massive scaling of talent acquisition plus learning and development. Learning a development is not just about technical skills that of course needs to be done. We have hired 100 people at the entry level and we are doing this every quarter. We are giving them the technical skills. But, we also realised that once we start moving and start to broaden the places where you hire from, you are also getting people who have never worked in sectors like these. In fact, they have not worked in corporate sectors. So there are multiple facets in order to prepare people to work successfully.How has the role of a holding company like GroupM changed? As you know the need for the business today is huge investment in technology. You must have heard this in Christian Juhl’s (global CEO GroupM) earlier interview where he talks about us being almost a software company. There is a lot more inclusion of technology to solve marketing problems. The role of GroupM has also changed vis-à -vis the agencies. We still want to have multiple agencies within the group. Because a lot of the client"s comfort and choice about who to work with depends on the people, the culture, and more. So the idea is always to give marketers the choice on what they see as their best fit. Eventually, everyone does the same thing but they do it in different ways. The people, the relationship, the culture and the match matters, because this is a people’s business. But to create the technology, to do solutions on scale, to build a single spine of customer data all these are the things we do at Group M and then we give it to the agencies that can customise it for every single client the way they want it. Yes, the role is changing and increasingly even more. Therefore, for GroupM, given our scale, the role is ‘how do we influence the market’. In Juhl’s interview, you would have seen how it is about giving the organisation a sense of purpose, there is a lot that is not right out there and how do we make advertising work better for people. What are the things that we need to do to make it work better? There are issues with data privacy, brand safety, there are issues with equity and diversity in the marketplace. If we let the free market prevail, then the money will flow into a couple of platforms. But different PoVs on media, and different content that is created needs to prevail. That is why you need a just and equitable market place and market power to ensure that it happens. And similarly sustainability. The world is going in a pattern that we don’t want for future generations. We are all working to make our businesses sustainable and the media supply chain in itself is a source of carbon emission.Q. And you do have a Media Decarbonization Programme. How does that work?We have created a carbon calculator, we are working with a third party—EY to audit it. And make sure all the validity checks are there. This is something that can be adopted widely because it is as close to accurate as possible. The idea is not to keep it as proprietary to GroupM but to release it to the market as a tool to wider adoption by everyone. The moment you start measuring what you are doing, you become conscious and start to take initiatives which are a part of that media supply chain to do something to reduce it. Which is why we say ‘the journey begins here’. We are working with the WFA and various industry bodies and we are giving it to anyone that wants it. Our people, brand managers, competing media groups, so that everyone can access.Q. So many world events have converged to create so much uncertainty. What is the outlook for the coming days?All of it has an impact on the outlook. For example, the Russia-Ukraine war definitely has an inflationary impact on the world. But for everything that is slowing down there are 10 other things which are adding to the market. If I look at it as a collective whole, my outlook still remains robust with double digit growth.Q. But will media spending take a hit?Media spends will take a hit from the established players because they will all want to protect their P&L in the short run. But there are many new players coming in who will nullify the impact of some of this at a macro-level. Individual companies will face up and down.Q. Your expectations from the India market?It is similar. There will be inflationary pressure, but at the same time there is so much money floating around in India fueling new businesses and there is strong demand coming from there. There is growing complexity, shift to digital platforms and shift to digital businesses from traditional businesses. All these are very powerful factors. GDP on a per capita basis is rising and ad spend is a part of that. Today, India is going through that phase that China was going through from 2000-2010, which is a huge influx of money in creating platform businesses, domestic brands going global or within India wanting to increase their domestic footprint. You will see a lot of consumer brands getting created and this will continue to grow very fast.

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Seeing a lot of new money coming into the market: GroupM's APAC CEO

In a freewheeling chat with Storyboard18, Ashutosh Srivastava talks about how the company is dealing with disruptive trends, the big opportunities unlocked by new brands, and talent issues

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