India Clients: “We Need To Start Paying Agencies More”
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India Clients: “We Need To Start Paying Agencies More”

The Indian In-House Roundtable in New Delhi, sponsored by Genesis Burson-Marsteller, drew six top-tier comms directors from blue-chip brands, sparking a robust discussion about fees, industry talent and social media.

Holmes Report

Last month, the Holmes Report held its first Indian In-House Roundtable in New Delhi, sponsored by Genesis Burson-Marsteller.

Drawing six top-tier comms directors from blue-chip brands, a robust discussion explored why clients are not paying their agencies enough, revealed dissatisfaction with the industry talent base and also investigated the changes being wrought by social media.

Participants at the Roundtable were:

Roma Balwani, head of corporate communications, Mahindra
Moushumi Dutt, director of corporate communications and branding, Philips India
Meenu Handa, head of corporate communications, Microsoft India
Poonam Kaul, director of corporate communications, Nokia India
Prema Sagar, principal and founder, Genesis Burson-Marsteller
Senjam Raj Sekhar, head of group corporate communications, Bharti Enterprises
Ranjana Smetacek, director of marketing and corporate communications, Fortis Healthcare
Arun Sudhaman, managing editor, The Holmes Report

Digital: the rise of social media

Sudhaman: We know that talent on the agency side is an issue, but what are the challenges on the client side?

Handa: PR is now evolving with social media coming in. The talent that has an understanding of PR, and  social media, that will be the challenge, especially at the senior level.

Dutt: Let’s look at the outsourced model here. Companies are not investing in digital. In three years I have not heard of a single corporate comms person even going for a training of this kind.

Smetacek: I think we are behind the curve here. There’s a value to having the knowledge of the potential of social media in-house, even if they don’t know exactly what it is.

Balwani: We have evolved our strategy. We took a conscious decision that we should start leveraging social media because everything becomes obsolete in a matter of seconds. We hired a digital strategist for the auto sector. We emulated the IT companies, we put a social media page on our website. Today it’s working so well, it is now automated. Social media needs a very robust process in place. Once you get that right, it works beautifully.

Sudhaman: Prema, from your perspective, how hard do you find it to bring in the digital talent that might make a difference to your clients?

Sagar: I don’t think it’s that difficult, but I think we are a bit behind the curve. What delays it is the true strategist. Everyone does social media and that is what they call digital. We are on an express train in terms of finding a very senior strategist. Is it the kids or someone who’s spent a lot of time on it? It’s both – somebody who’s had background on strategy and come into the consumer space. The more we integrate and the more we talk to clients about integration, the more they want to see that.

Handa: A PR person has always been a renaissance person. Earlier you had to have the content, the messaging, you had to be able to write, and you had to be able to have a good understanding of the media. Now it’s equally important to have the social media skill because going forward that’s increasingly where it’s going to happen. Every PR person will have to have these skills. It has to be inbuilt into your own psyche.

Balwani:  You need to have the SEO function integrated into all your advertising and brand promotion. People don’t want to invest in it though. How many of us have social media as part of our performance indicators?

Dutt: There are also global guidelines which really forbid you from being experimental in terms of what agencies are doing. The guidelines become very restrictive. I really don’t read a lot about social campaigns being done successfully.

Sagar: What you are doing has to be measurable and effective. It’s not just about blogging or sitting on FB and making comments.

Talent: agency vs corporate

One of the key issues that arose at the roundtable was the difficulty agencies find in keeping good people and, in particular, stopping them from going in-house at a certain point in their development. The issue is made more complex by the rise of a new generation of talent, who differ markedly from their older managers.

Sagar: Why do people join a PR firm? Quality of clients, fun place to work, less stress, and having a team. A lot of people on the client side are so alone. But the young people you get are not going to change to the way you work. You better change the way you work to understand the youth trends. There’s no changing them. They are chatting here and having a smoke over there. They only wake up after office hours. But they do the job. Why are we getting stressed, as long as they do the job? Certain things we have to follow, but certain things just throw them out of the window if you don’t like them.

Sekhar: A lot of big global PR agencies now have serious desire to be in India. So a lot of professionals here in India have the opportunity of going out. That opportunity is huge and one of the reasons why people in the corporate world are going to a Burson-Marsteller or Edelman. The second part I miss is the pitch. You go in and present and there’s a winner at the end of it all. The thrill of the pitch is not there on the client side.

Handa: The reason people bring fresh recruits to an agency are because the corporates are not going to take them. They join and it’s a revolving door at the junior level and a very few stay until the senior level. The corporate side pulls a lot of people in, because we pay better. I haven’t seen the reverse happening, people from the corporates moving back to the agencies.

Sekhar: I see it. I don’t think that barrier exists today, of going back to an agency. Personally, I wouldn’t mind going back to an agency.

Smetacek: I’ve hardly ever found an [agency] team that’s a complete team. Where’s the head, the arms and legs? I get an agency team of 10, great, but they are ten arms and legs.

Balwani: How do you work with the agency? That is important. Do you treat them as your team, or is it a vendor-client relationship? How can you address your agency as a vendor? As far as I am concerned, they are my extended team. If you trust them and take them onboard, then there is buy-in. These are things that really matter – the working relationship that you develop. They have to become steeped into the client. It’s also how your team can develop those relationships with the media. The talent has to be trained – so the next question is how much training is being done at a PR agency level.

WATCH A VIDEO EXCERPT: http://www.youtube.com/watch?v=3nZibLn4SnQ

Sekhar: Going back to what Ranjana said, there are a lot of heads, a lot of senior people in the PR agency world. But the middle is where it is really lacking. From the middle, I think a lot of people are going to the corporate side.

Smetacek: I think agencies give us too many of people. They give us 10 people – I think, whoa, what am I going to do with 10 people. It’s not about numbers but about having the right people. And the writing skills are terrible – where are all the good writers?

Servicing: The fee conundrum

Sudhaman: Is there general dissatisfaction around this table with the quality of talent you are getting from the agency side?

Sagar: We’ve recognised that content is a huge problem, that media is a huge problem. Why? Because print is growing, TV is growing, and now digital. We used to sit and deliberate over a press release. Today we don’t have the pleasure or leisure to sit and debate. The other side is everything at a pace, and you are getting average talent at best.

Smetacek: Partnership is what we are all looking for. But it means someone has to take the time, invest it, and become steeped in what I do.

Sagar: The problem is that both sides need to understand who to pull in. So that a top person is not being pulled in for a tactical thing, or the reverse. Who do you get in? Nobody is going to say, no, I’m not going to come to that meeting.

Handa: I think it’s also a little bit more about how you structure your business. How many people will handle what accounts? At a junior level, they can handle five accounts – I don’t care. But if the senior level is divided across 20 accounts, they are not going to have the time to sit and counsel with me at all. I think that’s where the agency makes a lot of mistakes – taking their good talent and spreading it around.

Sudhaman: That’s a funding issue isn’t it?

WATCH A VIDEO EXCERPT: http://www.youtube.com/watch?v=JlrRCABDp7g

Handa: We need to start paying more to agencies so they can create a better model. However I think agencies also need to invest more. One, in training, I don’t think enough happens. There are very few agencies that invest in training. Training is not adequate. Two, the way you structure your clients. Unless you know my business, how are you going to counsel? Certainly, as an industry, we need to start paying our agencies more. There are agencies surviving on a lakh or two lakh, that’s not going to bring talent.

Kaul: You look at any organisation, people don’t have patience anymore. And they want to leave for the corporate world.

Handa: But that’s because we don’t pay the agencies enough.

Sagar: Not just money. Often corporate comms teams can be very nasty to the agency teams. And they can’t take the abuse anymore.

Sekhar: What we need to do as an industry is attract better talent. The profession needs to be seen as attractive and strategic.

Balwani: The problem for agencies is there are corporates who don’t view it as a strategic function. Training is important, it has to be a business function. If the agency doesn’t invest in the right kind of talent, unfortunately you start to feel there is no sense of alignment. What is the screening method you go through? There should be benchmarks.

Sudhaman: I do think we need to talk about this issue of money. Every agency I meet in India, they say they are not paid enough and it is actually dropping. Salaries are going up. What is the issue here – why is there this disconnect? Is it the budget you are getting within your own companies?

Dutt: The PR budget at Philips hasn’t gone up, and yet the cost of the headcount from the agency is really going up. And every time there is something over and above the agreed scope of work, that is an extra cost. They are fair to ask for that, but I really have no other place to go to look for that money.

Sagar: And most people bring a number out of their hat in India.

Balwani: The Indian finance manager’s mentality is about a retainer. They cannot deal with variable pay. I feel that’s the most objective way to do it.

Smetacek: You go shopping for an agency, you obviously look for a whole bunch of things. As long as all of your baseline things are met, then I’m going to ask why is this guy’s cost double yours?

Sekhar: There’s one area where I feel that all the agencies can work on increasing retainers. It is to fundamentally link the PR agency measurement to business performance.
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