MxMIndia

Tag: Bharat Rajamani

  • A quick view from MxMIndia and Bharat Rajamani of EY India on how Arun Jaitley's Budget could help up adspends

    Achche Din for Adspends post-Budget 2017-18

     

    The Union Budget presented by Finance Minister Arun Jaitley is by far one of the most awaited annual economic and political events in the country. On the surface, the Budget didn’t make any specific provisions for the media and entertainment sector. But MxMIndia analysts believe that the Budget could well result in a medium boost for the sector.

    For one, adspends are going to increase with the all-out emphasis increase on domestic consumption. The government is aware that it’s just got two years to go ahead of the next elections, and more than lipservice, there have to be concrete signs of ‘achche din’ having arrived.

    We asked Bharat Rajamani, Executive Director & Solution Leader – Marketing & Advertising Risk Services (MARS), at EY India, for his expert view, and this is what he said:

    “The Budget was a fine balancing act between the need to push growth and to achieve it within fiscal constraints. The key takeaways include emphasis on rural economy, affordable housing and encouragement of digital transactions. The budget’s focus on digital transactions and rural digital network will encourage the FMCG, consumer durable, automobile and micro finance companies to explore innovative ways of utilising digital advertising in rural areas. The cap of Rs 3 lakh on cash transactions will bring about transparency and boost tracking efficiency in marketing. Further, the budget recognised Metro rail as an emerging mode of urban transportation which will again encourage brands to shift focus to transit media and make Out of Home (OOH) media more versatile.”

    While we will await other industry forecasts – specifically the one from Madison on February 15, MxMIndia believes that while the direct sops to M&E are not very high, the elections, two major cricketing events (IPL and Champion’s Trophy), telecom (post-March 31, when the Reliance Jio free internet scheme ends) and routine FMCG, retail, BFSI, real estate and festive spends should see the growth of adspends in early two digits.

    Let’s wait and watch.

     

  • The finding is from a recently concluded study by EY with global creative and digital advertising agencies, titled ‘What’s next in margin improvement?’

    Adding 2% or more of additional margin drives major bottomline results, say ad agencies: EY study

    By A Correspondent

     

    As high as 84% of agency respondents believe they could achieve margin improvement of at least 2% with more robust project and resource management processes, according to a recently concluded study by EY with global creative and digital advertising agencies, titled ‘What’s next in margin improvement?’.

     

    While 90% agencies have project managers, only 9% of those say that their project managers are formally trained in project management. Similarly, while 65% of agencies have resource managers, only 12% of those resource managers are trained in talent management or resource optimization. With the increased diversity of skills required, use of freelancers, crowd-sourced creative models and tech providers, there is an even higher demand for robust resource and project management.

     

    Additionally, the advertising business is seeing a fundamental change – from paying for people, clients are now paying for the output. The move away from the retainer model to project-based fees is also putting pressure on margins. The challenge is typically internal pertaining to poor infrastructure and managing talent. However, in this change of economic models, lies a sizable opportunity for agencies that have the capabilities to find value in such flexible arrangements, according to EY. Only 21% of respondents saw new economic models and performance-based fee structures as an opportunity.

     

    “The advertising industry is at a turning point in its cycle where the agencies will need to evolve their project and resource management skills in order to continue to be sustainable. Talent is their core asset and they should therefore have clear guidelines and processes, even for freelancers. Agencies will need to take into account the clients, employees and their self-growth when designing their strategy. A one-size-fits-all approach may not be profitable. They must be flexible depending on the complexity of projects and clients,” said Bharat Rajamani, Director and Solution Champion, Marketing and Advertising Risk Services, EY.

     

    The survey included inputs from nearly 50 agency executives from leading global agencies and represents combined revenues of approximately $58 billion.