With a total of 75 metals against its name, ABBY One Show 2023 Creative Agency of the Year Leo Burnett India is waiting for its next big haul at Cannes Lions, which starts later next month. Dheeraj Sinha, CEO, Leo Burnett South Asia and chairman, BBH India, speaks to Akanksha Nagar about the significance of advertising awards and the evolving definition of creativity. He also discusses how the global economic slowdown has impacted agency remuneration. Edited excerpts:
Does Leo Burnett winning the ‘Digital Specialist Agency of the Year’ title mean that specialist agencies do not necessarily create specialist work?
I don’t think you can generalise. When I took over Leo Burnett about six years back, we were very clear about building a new-age agency. Since then there’s been a complete overhaul of the culture, the kind of talent we’ve hired, or clients we’ve gone after or even the work we’ve tried to create. It has been a deliberate journey to reach here. It’s taken a lot of effort and to my mind, this is a victory of that thinking.
For Cannes Lions this year, we have the finest line-up we’ve ever had, with six cases competing; generally, we only send one or two entries. Having said that, any award is also about the jury in the room that morning. We love winning but don’t take it so seriously that it becomes our end goal. It is good to get this endorsement and testimony but our objective is to build an agency for people where they come and do their best work to make clients successful.
How many of the agency’s accounts are new-age clients?
Our revenue from new-age clients is about 25% of the total revenue and it was almost zero five years back. The project and retainership ratio is 30:70. 30% of the revenue comes from projects; most of the projects are project-based relationships. And this is across multiple functions including strategy, regional, advertising projects, design, and identity projects.
The agency has been growing well and has won businesses worth approximately `20 crore in the first three months of this year, including a good number of large pitches like IKEA. The global economic slowdown has impacted the tech part of the business and large clients such as PhonePe and Meta are seeing a bit of a slowdown, but at the same time, that is being compensated with the momentum in CPG and FMCG.
In terms of the agency fees, there has been an impact on the tech side of about 5%-6% and it will stay this way for this year or maybe half of next year.
How do you see the creativity palette evolving with generative artificial intelligence (AI)?
Nobody right now has a total fix on what generative AI is going to do. Anybody who’s saying it with any degree of definitiveness is actually fooling, that’s the caveat number one. Having said that, I think it’s an opportunity, it is not going to take away jobs either. Creativity is the superpower that agencies have and everything is a tool. Creativity is not to do with just advertising, but to solve business problems.
We, as an agency, are in a phase where we are studying everything and undergoing regular training related to AI and making investments. At the group level, we have a huge workstream around generative AI.
There are campaigns that have a creative quotient but lack scalability or long-term effectiveness. How can marketers, especially during an economic slowdown, balance the two?
It has to be both. We have to be ruthlessly clear about it that it is a commercial business and we are here to make the clients successful and to create ideas that solve human problems. We’re not in the business of chasing an award, we are in the business of making our clients’ businesses successful.
So brands must be purpose-driven? And so should advertising?
I think purpose is very good, but purpose again has to be in the line of your business. And you have to put your money where your mouth is, you cannot just make an ad and a statement and go away, it doesn’t work like that. You have to have a real commitment on the ground and then the purpose is fantastic.
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