News | ‘Omnicom Advertising Services will create opportunity for specialization of our agencies’
US-based Omnicom Group last month appointed Aditya Kanthy as the CEO of its recently established Omnicom Advertising Services in India. Omnicom Advertising Services brings the company’s three agencies (DDB Mudra, BBDO and TBWA) under one umbrella and Kanthy’s role includes overseeing these agencies with a focus on talent, cross-agency collaboration and innovation.
In a conversation with e4m, Kanthy spoke about the need to consolidate the services under one umbrella. According to him, this is not a merger, but just a way to organize three individual agency network brands.
“Omnicom, over the last 40 years, has been built on the back of strong individual agency brands like DDB, BBDO and TBWA in all the markets they operate in. We are the only company that has three network agencies with such credibility. We are very clear about what we are doing; we are doubling down on our agency networks and Omnicom Advertising Services is a way to make them stronger. Outside of our creative networks, Omnicom, both in India and globally, has an incredibly wide set of capabilities and Omnicom Advertising Services’ job is to make it accessible,” he said.
Elaborating further on the reason for the creation of Omnicom Advertising Services, Kanthy shared that one of the significant reasons is the growth of India as a market for Omnicom. “We are seeing rapid growth in the Indian market. Chairman and CEO John Wren has, in the last two earning calls, said that we have an ambition of housing more than 15,000 jobs in India that serve the global networks. Omnicom’s presence in these local markets will help drive that. There is also a realization that with the complexity of the marketing ecosystem, there is a need for specialization. Omnicom Advertising Services will create the opportunity to tap the specializations of each of the individual agencies. We are currently working on structuring ourselves at a holding group level, something that we have not historically done for creative services in India.”
According to Kanthy, talent is also one of the aspects. “Things are moving at such a brisk pace and there is so much fragmentation across the whole market funnel that clients require talents to counsel them with the happenings of the market,” he mentioned.
So, what happens when a pitch is asked for? Who will participate in the process-- Omnicom Advertising Services or the three agencies individually?
“We want to do what is right. There may be situations when not only the three agencies but other entities in the group is required. Also, there may be situations where a client's needs are best delivered through one agency network. The entity wants to bring everyone together for the benefit of the client,” explained Kanthy.
Whenever there is a structural change, employees are the most affected. So, what impact will this have on the staff of the three agencies?
“We are very clear about the culture and ethos of each of the agencies. Omnicom Media Group has successfully proved it with OMD, PHD, and Hearts & Science. There is no question of any impact. If anything, the impact is going to be on our ability to scale and give people bigger platforms and careers. The impact of this structure is more on the designs of people's careers across the group and geographies. The ability to grow talent is the advantage we have and the belief that we will be able to do it more with the holding group. Each of the agencies harbours a certain culture and if you take that away it is meaningless.”
Since the idea behind creating the new entity is to increase the presence of the company across India and scale up the strength of the organization, we asked Kanthy, how they plan on doing it. He shared that the ambition is to scale from 6000+ people in India to 10000-15000 in the next 3-5 years.
“There are also investments being made in both soft and hard infrastructure. John spoke about building campuses in Hyderabad, Gurgaon, and Bengaluru, to be able to house talent. We have experienced people to grow the deep pool of talent across markets. Also, there are efforts at the grassroots level because there's a huge amount of talent in our country right from the urban cities to the regional ones,” he added.
Kanthy said that the brands had a positive reaction to this announcement and welcomed it with open arms. When asked about whether they’ll be submitting one financial statement consolidating the business of the three individual agencies or they’ll do it individually, he said that Omnicom Advertising Services level view which will combine everything that happens in the three agency networks . The individual agencies will run their operating plans.
Speaking about how the year has been business-wise, Kanthy said that although the year has been good, 2023 was quieter compared to 2022.
“I think, and it is evident across categories through our clients, that it has been a year of measured optimism. There is some pressure like inflation because of which we have slowed volume growth across categories. Last year, there was a surge, but this year has been quieter across the globe. But the fundamentals are well. Yet again there is more measure and more caution for the right reasons as it mirrors what is happening in the economy. Our business is impacted by the consumption. Our hope is as we go into 2024, we will see the demand coming back.”