India: PR Growing, but Major Challenges Remain
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India: PR Growing, but Major Challenges Remain

After a week observing the Indian PR market up close, a few thoughts spring to mind. The country is an increasingly confident, optimistic place - fuelled by double-digit economic growth. Unsurprisingly, in this environment, business expansion is viewed as inevitable.

Holmes Report

After a week observing the Indian PR market up close, a few thoughts spring to mind. The country is an increasingly confident, optimistic place - fuelled by double-digit economic growth. Unsurprisingly, in this environment, business expansion is viewed as inevitable.

 

Instead, in common with many emerging markets, most of the people I spoke to are grappling with how best to manage the issues that stem from rapid growth. These challenges often appear universal, but they are also defiantly local. Here are a few:

 

Fees

 

It is easy to lose count of the number of agency heads who complained that their firms were not being remunerated at a fair level. Griping about fees is not exactly unheard of within the agency world, but India’s complaints are magnified by some troubling factors. To begin with, there appears to be no standard fee-per-head ratio, which makes over-servicing a very real scenario. The proliferation of agencies, meanwhile, means that under-cutting is rampant.

 

Not that agencies should be held totally culpable. Client PR budgets are static and, in some cases, have declined. In this video, Six Degrees CEO Rishi Seth explains how the recession sparked a vicious circle of budget cuts on the client side, and poor servicing on the agency side.

 

At the Holmes Report’s inaugural In-House Roundtable, sponsored by Genesis Burson-Marsteller, communications directors from the likes of Microsoft, Philips, Bharti Airtel, Nokia and Mahindra all agreed that agencies needed to be paid more. Unfortunately, they also pointed out that their own budgets were not increasing.

 

The situation is further complicated by the fact that corporate communications functions themselves are a relatively recent phenomenon. Thus PR agencies are often retained by, as one agency head pointed out, marketing directors, company secretaries, even finance departments. Until PR becomes accepted by companies and their CEOs as an important budget item, agencies will struggle to see fee growth.

 

The issue is brought into further stark relief by the continuing growth in agency costs, notably salaries. And it has implications for the level of investment that agencies can make internally, on such critical areas as training, professional development and innovation.

 

Paid editorial

 

India’s media is a feisty many-headed beast that is growing at a rapid clip. In print, vernacular media is primed for expansion, while a mind-boggling array of TV channels compete to shout the loudest. For PR agencies, this brings a number of opportunities - but concerns over ethical practices remain.

 

In particular, a number of people pointed out that the practice of paying for editorial space is rife, with both media and PR agencies complicit. Some agency heads I spoke to said that it was simply too late to change this system now, while others believed that readers - by now - are aware that editorial is often commercialised.

 

Some Indian journalists, notably The Hindu’s P Sainath, have made attempts to bring the issue to light, but the country’s Press Council appears uninterested in an investigation. The consequences for the PR industry are not hard to fathom.

 

“Somehow, a lot of clients have found it is more influential to use cash than to have a great idea,” said one PR agency head on condition of anonymity. “It’s less hardworking and more satisfactory to the clients. It also tends to confirm long-held client beliefs as to how the media works.”

 

The issue first reared its head when the country’s bigger media groups introduced the notion of ‘Private Treaties’, where they takes stakes in companies in return for advertising space. “That has the potential for compromise, so it is troublesome,” said the agency head. “But more troublesome is that you can buy editorial space against ratecard.”

 

Policy & Public affairs

 

India’s complex regulatory environment, and its growing importance to major foreign and domestic companies, means that public affairs is becoming increasingly critical. But the industry remains dogged by a reputation for backroom deals, what one agency executive described as “suitcase diplomacy”.

 

Powerful lobbyists - and there are several - are one thing. More and more, though, a number of agencies are developing broad advocacy campaigns on behalf of corporates or trade associations, designed to spark grassroots support and build mainstream awareness of an issue, and ultimately influence regulators.

 

A good example of this trend is Torque Communications’ work on behalf of the Shell Foundation’s ‘Room to Breathe’ campaign. The programme attempts to wean rural Indians off their dependency on dangerous, primitive cookstoves. The agency has used digital, rural activation, local government outreach and conventional public affairs, to ultimately change how both people and government see the issue.

 

“You don’t have to lobby individual ministers and ministries,” says Torque CEO Supriyo Gupta. “You can create media platforms”.

 

Talent

 

In India, it is not so much a war for talent as a kind of industrial fratricide. Staff turnover at mid- and entry-level agency positions can reach as high as 50 per cent. Poaching is only set to rise, meanwhile, as more international players - including the likes of Ketchum, Waggener Edstrom and Bite - enter India.

 

“There is enough business for everyone to grow well,” says Zach James, co-founder of Six Degrees. “What there isn’t enough of is the talent pool. The big guys are going to start to apply pressure on the cost of acquiring this talent.”

 

Torque’s Gupta believes that now there is a “basic talent pool”.

 

“Today there are a lot of people coming in because it has emerged as a profession,” he notes. “That does not necessarily mean that you have great talent at the mid- and senior-level. So there is a large pool of talent, but how do you develop that?”

 

Madison PR CEO Veena Gidwani agrees that attracting people into the profession is no longer as difficult as it once was. Instead, she wonders about the type of person that is joining. “People think it is glamourous”. On that misconception, at least, maybe India’s PR market is not so different after all.

 

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