We have maintained our strong organic growth despite the global macro-economic turbulence: Anupriya Acharya

Q: We have seen a subdued year so far. Is this due to elections or other macroeconomic conditions?

Earlier in the year, we observed some slowdown in consumption in some consumer product categories. The market was in a bit of wait-and-watch mode, given that the elections were underway.With general elections coming to a close and a ‘first 100 days’ plan in place by the government along with a positive expectation from the budget and an above-normal monsoon forecast, the second half looks to be very promising. There are a lot of positive trends such as the food services industry seeing an 8.1% CAGR growth between 2024 and 2028, demand has stabilised for packaged foods (FMCG), and they are expected to increase ad spending in the second half of the year.

At Publicis, we have maintained our strong organic growth despite the global macro-economic turbulence.

Q: With a stable government, do you think the situation will improve now?

India has been on a growth path last many years and with the government in its 3rd term we expect that that growth agenda to continue. Coupled with the positive market conditions, demographic dividend, and growing domestic demand, India will continue to be an attractive market for foreign brands and investors alike. We already see a surge in the GCCs (Global Capability Centres) being set up in India. The domestic market will continue to drive further growth. As some argue this is not just the decade but also the century of India. Post-elections, we’ve observed a renewed sense of optimism and strategic clarity among brands. With the festive season around the corner, many are accelerating their marketing efforts, focusing on innovative and impactful campaigns to capitalise on the increased consumer spending. This period is crucial, and our clients are leveraging the positive market sentiment to drive growth and engagement through creative, data-driven initiatives. Clients across sectors, particularly F&B, Auto, BFSI, Retail and Pharma have several initiatives planned for the rest of the year, including new product launches and brand extensions, festive promotions, and geographical expansion plans. All in all, H2 is expected to be buoyant.

Q: What are your expectations from the Union Budget?

Well, my expectation is that the Union Budget will focus on manufacturing, infrastructure and development, technology, AI, and skill development. Also, there will likely be more focus on ESG including more provisions for electric vehicles etc. A lot of this will lead to more job creation. Coupled with some easing on taxation, we expect more money in the hands of consumers and more purchasing power, which is great for a lot of our clients and us.

Q: This has been a tough year for India at Cannes, and the controversy around JSPL’s Steel of India campaign has added to it. As a past jury member for Media Lions, do you think the industry needs to take stricter measures?

A wake-up call is always good. Clearly the level of competition has gone up globally and it’s time that our talent moves out of their comfort zone and rises to the occasion. The good news is that we have broken into new categories like innovation, data, and sustainability. I’m sure with some focused introspection and careful honing of creativity, we will be back with a bang again.

Also read | Realize the need to disrupt ourselves: Publicis CEO Anupriya Acharya

Q: What are the biggest challenges you foresee for the advertising industry in the next five years?

The creative industries at large, including advertising, are in the midst of dramatic transformation brought about by the rise of new technologies, the increasing demand for social responsibility, changing consumer values and eco-systems, and growing competition from new entrants and alternative models. Access to new technologies–both on the supply and demand side–is perhaps the most significant new variable that the industry is working with. While creativity unquestionably continues to be at the core of what the industry delivers, both the input mechanisms that inform creativity and the outputs where it is manifested are changing at a rapid clip. The fact that nuanced and sharp insight is at the core of the best creative solutions is not new news, however, the richest source of insights is very new as the industry learns to harness gigantic amounts of data to derive it. Similarly, the importance of storytelling in engaging with consumers is not new, however the ability to do so effectively in a disaggregated platform environment is. The power of a unified humanistic core of a brand is not new, however, the skill required to preserve its integrity at scale in a hyper-personalised and hyper-local world is being developed. The idea of automation in the service of creative delivery is not new, but effectively harnessing the myriad ways in which it can augment it today is an evolving process. And last but not the least, the fact that creativity must demonstrate effectiveness is not new news, but new platforms and technologies that have made measurability much more specific and granular mean the industry is greatly more accountable and responsible for the impact of the creative product it delivers.

Brands, and by implication advertising companies, also increasingly need to demonstrate a role in society that goes beyond commerce. On the one hand, regulatory and policy factors mandate this; on the other, the power of communication to influence public opinion comes with more responsibility and accountability. Significantly, consumers are expecting brands to help navigate uncertain and complex socio-cultural environments with value systems that embrace diversity, inclusion, equity, and sustainability. Consequently, the industry needs to build this into its vision and ethos, while collaborating with brands and partners to embrace this trend. This also means the industry needs to adhere to the codes and guidelines of self-regulation as well as government regulation.

The advertising industry is facing increasing competition from new entrants and alternative models that are challenging traditional paradigms of the industry. From tech companies and consultants to in-house startup creative teams and influencers, the puritan creativity of the traditional agency is being democratized. Equally, the traditional agency-client relationship is taking new forms with consulting-style hybrid teams, and distributed models, increased linkage to business outcomes. This has obvious implications for the business and operating model of agencies.

Also read | Publicis Groupe appoints Anupriya Acharya as CEO, South Asia

Q: How are you adapting to these changes and the increasing demand for personalised and immersive ad experiences?

We continue to invest very heavily in Core AI as a network – as you would have seen in the earlier announcements made–announcement on CoreAI in Jan 2024 by Arthur (Sadoun, chairman and CEO, Publicis Groupe). There is a whole workstream around it.

At a market level also, technology stays at the core of everything we do. We have more than 500 technologists across the Groupe who support all our lines of business across creative to media to digital. One of the things they do is give early signals on new trends and technology which impact our area of work. This includes personalisation and immersive ad experiences - Whether it was Metaverse earlier, some great work has been done in that area or AI/Gen AI now–Airtel 5G launch, Say it with Oreo, other campaigns around gaming. We also invest heavily in data and data solutions and work closely with our clients around the infrastructure that best suits them. Each client and category are at a different level of sophistication and have different drivers in this area. We customise our offerings to their requirements.

Q: While globally, Publicis has become the most valued company in this space, in India, it is still behind WPP. Can you share the details on the India business performance in the last fiscal year, and what are the targets for the next year?

The target for us each fiscal year is strong double-digit growth–which is a sum of continued organic growth with our clients, strong new business momentum and continued investment in future-facing capabilities.

While I can’t give specific numbers, we have seen strong momentum and growth and that’s in part due to our unique modeladapted to the needs of some of the world’s leading companies, unmatched capabilities, and the depth of talent that we have. If you look at some of the biggest wins that have happened in recent times, they have all been Publicis wins–Spotify, Lego, Pepsi, Meta, Abbott, Procter & Gamble (Digital) etc. Apart from these, some other big wins are yet to be announced. Last fiscal year was huge for us. We also saw expansion on our existing key accounts that are themselves performing very well be it aNestlé,Hero, HDFC bank, Airtel, Haleon, PepsiCo, or Axis Bank.

Our accent has been on specialised services, and we have sharpened our offerings across Commerce, Creative Tech, Performance Marketing, Content, Production, Experiential, PR and Shopper marketing and have seen good uptake on these. It’s of course been a fantastic showing on awards and metals for many of our agencies. Here, of course, Leo Burnett India leads the trend by far. It is clearly the country’s top creative agency if you look at both local and global accolades. Leo Burnett India was at #1 position, Creative Agency of The Year at Abby’s 2024, for the third successive year and also won 6 specialist titles – Agency Of the Year accolades in Direct, Digital, Mobile, Technology, Brand Activation & Promotions and Branded Content & Entertainment. Across the Groupe, we won a whopping 106 metals across multiple reputed brands at the Abbys Goafest awards.

Leo Burnett India was the #1Indian agency at the highly prestigious The One Show Awards 2024, with standout work on Oreo, Lays, and Ikea. More recently, Leo Burnett won 2 Global Grand Prix at the prestigious WARCAwards for work on P&G Whisper, ‘Missing Chapter’ and PepsiCo Lays 'Smart Farms'.The Global Grand Prix are the highest accolades of The WARC Awards for Effectiveness 2024. At Cannes Lions 2024 also, it was the most awarded creative agency from India.

We continue to invest in talent through many initiatives around their training and wellness alike. We track employee satisfaction regularly and proactively address areas of opportunity. Some of this is reflected in the accolades our agencies get.

Q: What are your views on the future of influencer marketing and its effectiveness?

As we’ve known it now, influencer engagement in brand building is here to stay – in fact expected to double in the next two years! It’s going to evolve and expand in its scope and relevance, and brands who understand this and adapt will be the ones who benefit from its effectiveness. The influencer landscape in India is becoming more diverse, with influencers spanning various niches such as fashion, beauty, technology, travel, fitness, and finance. Game-fluencers, mom-fluencers, pet-fluencers, and granfluencers, these communities are expanding across platforms like Meta, Instagram, WhatsApp and others.It’s all getting down to engagement and segmentation now. So, whether it’s micro or mega influencers, how they integrate into campaigns and their interaction with audiences is what will bring value to brands. We are getting deeper in our hunger to decode this better for our clients. MSL India, our PR firm, just released their study on Bharat’s GenZ’s. Essentially delving deep into the behavioural and buying patterns of this very large consumer base.

And as this space grows, the space will see the development of more relevant and reliable measurement metrics. Currently, reliance on data in this domain is largely for aiding the discovery and selection of creators. The need to go beyond vanity metrics will push brands to invest in attribution models that measure real business success. Also, the future will see a greater emphasis on authenticity and transparency. The Advertising Standards Council of India (ASCI) has introduced guidelines to ensure transparency in influencer marketing, which will help maintain credibility.

Q: The recently concluded industry event Goafest was criticised for not raising critical issues plaguing the industry. The bigger question is, whether the industry is taking cognisance of the issues it is facing?

I honestly think that the ad, media and marketing industry has a lot going for it, and we spend more time talking about the problems than celebrating the successes. The ad industry is in a far different place than it was in the past and we’ve in fact seen a huge influx of new, diverse talent in the business, new roles being created, and a lot of growth being driven by technology. We haven’t seen the sort of instability that plagues many other sectors. In fact, we have innovated in step with the times and kept up with the changing requirements of brands. Specifically, Publicis has been able to evolve as a true transformation partner for clients, with data and technology now generating a significant part of revenues.

People are our greatest strength and resource and I feel that the industry is witnessing a great creative renaissance. Technology gives us that much more room and opportunity to be inventive and bring in more value for companies, increasing our relevance.

I feel that a lot of the criticism is completely unwarranted and unfair to the industry overall. I have seen media reports querying the relevance of the awards, the future-readiness of the industry in the context of technological changes and whether it still holds the attention of youngsters.

The Goafest Abby One ShowAwards is the onedefinitive industry ad awards domestically; the gold standard in advertising and you’ve to only look at the participation numbers, be it the total delegates, sponsors, jury, speakers to know just how significant and successful it is. And that is the case year on year. There were over 3506 entries this time, from over 273 companies.

Further, this year’s theme itself ‘The Age Of Adaptability’ is an acknowledgement that the industry is going through tectonic shifts on account of technology, particularly Generative AI and how we are responding to these unprecedented changes with agility, reinventing ourselves and keep the business strong. A platform such as Goafest gives us a chance to share experiences, learnings, and best practices from this very dynamic, exciting, charged-up landscape. In addition, Goafest is constantly reinventing itself in response to the changing times and environment if you look at the sheer range of evocative, stimulating subjects and discussions it takes on as well as the very insightful Masterclasses. The festival clearly has the pulse of our industry.

Q: How are you addressing the growing concerns around ad fraud and ensuring brand safety?

Ad fraud and Brand safety are two very different challenges. They are often spoken of together but are very different in nature. Ad fraud is a higher priority to tackle as it results in loss of revenue and wastage of spend. This is where your ads are not being served to your consumers. In fact, they may not be served to even humans. This can happen right from the view of the ad all the way up to false purchases showing up in the consumer journeys. To tackle this, we use third-party tracking and measurement and of course the actual business outcomes. As you know we are leaders in Performance marketing.

Brand safety on the other hand is more about placing brand ads in the wrong context/content. While this has no direct impact on business, it can cause a significant impact on the brands’ imagery and create a lot of negative backlash from consumers of the brand especially given today’s heightened social media landscape around responsible advertising. Here too, there are solutions provided by third-party players and by platforms like Google, Meta, Disney, and Viacom themselves to ensure the brand appears in the right context. We also use exclusions in the pre-bid stage to avoid such context.

Q: Which sectors are increasing their ad spend, and which are holding back?

We're seeing a big boost in advertising from CPG companies, with FMCG gearing up for a significant increase in ad spending later this year to drive sales. After a strong 2023, the automotive industry – encompassing passenger cars, two-wheelers, and EVs–is pumping more into marketing and advertising in 2024. Even the BFSI and fintech sectors are on the rise, focusing on building trust and promoting a diverse range of financial products and services. The retail sector is also booming, driven by a growing middle class, higher disposable incomes, and urbanisation, especially in tier-2 and tier-3 cities. Retailers are upping their ad budgets to seize these new opportunities. The other sectors adding to the surge in ad spend include pharma, real estate, telecom, government & political advertising, e-commerce, and jewellery. On the flip side, the education sector is being more cautious, mostly due to a drop in spending on Edtech initiatives.

Q: What are the key trends you see shaping the future of digital advertising in India?

We have to keep an eye on the future and emerging trends continuously. Some of the areas that will shape the future are the changing demographics and the bigger role of GenZ in the consumer world –most of them are screen junkies and used to personalised addresses by platforms. The channels of influence are also having tectonic shifts - Connected TV, Quick Commerce, Social commerce, Influencer Marketing, and Gaming are all rising exponentially and will shape the context of advertising and storytelling as it stands today. On the marketer side, there is the emergence of all kinds of new-age brands and private labels that will compete with established brands of the past. A lot of these are digital-first and hence the competition on digital advertising will be of a different level. And then the data, safety and privacy regulations and technologies that solve for it are also going to shape digital advertising.

Q: How do you plan to stay ahead of the curve with the rapid advancements in technology affecting the advertising industry?

We plan to stay well ahead of the curve by future gazing and mapping, investing in capabilities, training and development and relevant acquisitions.

Q: What are your thoughts on the impact of ad-blockers on the industry, and how is your agency responding to this challenge?

While instances of ad-blocking in India are lower (less than 30% as per GWI report), it ensures we find the right context to be present when our consumers are most receptive. Ad blockers pose a different kind of challenge. Here it’s the consumer who is making the choice to not see ads. Hence to ensure we still get our communication across; we work with those partners who provide advertising to consumers where it is acceptable. Hence a strict view-ability metric becomes a key to deciding where to advertise. There is also work on in the industry to measure attention which goes beyond just media but could potentially be a currency for the future. It is important to note however that adblockers do not cause any loss to the advertiser as the ad has not been served and hence it will not be paid for. Yes, there is massive media inventory on the open web which is delivered on browsers. But then, mostly they are evaluated based on performance. So, the advertiser pays only if it works.