AgTalk | Publicis acquires Beehive, we get the 'heads' talking!

Amidst a much hush-hush situation, a major announcement was made with Publicis Groupe SA  acquiring Beehive Communications, a Mumbai-based advertising agency, for an undisclosed amount. This is the group’s seventh acquisition in India since the middle of 2012. These include Indigo Consulting (April 2012), Resultrix (August 2012), MarketGate (December 2012), iStrat (December 2012), Convonix (March 2013) and Neev (April 2013).

Founded in 2003, Beehive Communications which shall now be re-branded as Publicis Beehive Communication, has 134 employees across Mumbai, Delhi and Bengaluru. Services offered by the agency include creative, reputation management, media, digital, brand activation and research. It claims a client roster that includes Malaysia Tourism, General Motors, Korea Tourism, Jubiliant Retail, India Bulls Finance and Bisleri.

Adgully caught up with Nakul Chopra, CEO, South Asia for Publicis Worldwide and Sanjit Shastri, Founder and CEO, Beehive to know more about the new move.

Following are the excerpts from the conversation.

Adgully AG: Is ‘acquire and build’ the current policy at Publicis?

Nakul Chopra (NC): Well, not really. It is true that we are not shy to acquire where we see strategic width according to our own vision. I think we are equally investing substantially in growing our businesses organically. I believe that no other agencies would invest as much as we did in the last year in the form of hiring talent and resources like Bobby Pawar, Partha Sinha or Ambika Shrivatava along with other people also. So, we are equally investing organically and inorganically to grow.

AG: How do you think the acquisition will help you in building an edge for Beehive?

Sanjit Shastri (SS): I think, building an edge is not the thing that we are seeking. I think there is enough business for agencies who want to do good work. So we want to make sure that we do good work with efficiency and pace. I believe that with the scale that Publicis has, we will get to do good work! We have always focused on efficiency, be it time or money. So, I believe that Publicis will help us to improve the quality of our work to a large extend.

AG: How do you rate Publicis India wiz-a-wiz competition?

NC: I would like to believe that we are the best! But if I had to step outside, I would say that with the moves that we have made over the year, we have very clearly acquired the capability to be counted as best amongst the best. At the same time, one has to know that there always place for multiple players. I think what we have been able to achieve over the last 3 – 4 years, especially, in the last year is that whether by size, width of services, depth of talent we are now shoulder – to shoulder to be one of the best.

AG: You have already acquired a lot of agencies over the last couple of years. How will Beehive add in to your strength? What attracted Publicis India to Beehive, specifically?

NC: Beehive brings scale, added vertical exposure; add to the width of our services, exceptional pool of talent, especially their leadership team; they also help us in many ways to complete our suite of services and our geographical coverage in digital.

AG: You mentioned that this acquisition is a culmination of the process for this year. So, post this, what is the market share that you are looking at now.

NC: (Laughs) I think yes! But what needs to be noted is that making an acquisition is just the first step. Using the strengths of that acquisition, binding it cohesively into the existing organisation are things that still have to be done. Given that this the third acquisition this year, I can say that for the next 15 months we are surely going to be very busy in ensuring the maximisation of the value of these three acquisitions. As far as market share is concerned, it is a very difficult matrix to discuss or disclose. But internally we have set very numerical targets, which we do not wish to share. At the same time, we are clear that over the next 3 years, we will seek to be counted amongst the top 3 players in the industry.

AG: The year has been though as far as financial or business space is concerned. What is the strategy that you are working on to build market strength?

NC: I think though is the way of life. We have to stop saying to ourselves that the conditions are though, because they have been though, they are currently though and from all available signs they are going to remain though. I would say that next year would possibly tougher than this year. I am happy that despite this condition, I would say that we are optimistic and being optimistic in an overall pessimistic environment is a big thing for me.  

AG: WPP has invested in a lot of businesses. Post this acquisition, do you also see yourself acquiring or investing in content creation or content aggregation.

NC: Though I am not the correct spokesperson for this, but I would say that from the overall picture of the group, digital has been and remains to be an area of high focus. The group today, is a leader in this area or segment. Whether a competitor is investing in a particular activity, I do not think that should the material for us to talk about it or give heed to it. 

AG: Beehive has been in the industry for over a decade now. Any specific reason to wait for a long time to take this step.

SS: I believe, at the size we are, we have had people working with us for 10 years now. So they must have an opportunity to grow and therefore would want to play on a bigger and wider platform and Publicis would definitely do that for them.

AG: What are the core competences that you have build over the years and aim and plan to continue as well.

SS: I believe that any organisation requires two critical pillars, a culture and a strategy. Our culture is to take care of people, be it clients or within the agency. This I don’t think will change and we shall fiercely protect. The strategy that we have is that we would like to grow in verticals where the paradigm is changing and where the demand – supply situation is altering and build it from there; for example education.

AG: Since you are under a larger umbrella now, where do you see yourself in 2014? Any other vertical that we see would be added on to the current offerings.

SS: Beehive would definitely grow. By the end of next year, we would be about 150 people, though we are targeting March 2015 to be around 170 people on board. We would be as profitable in terms of percentages and as performing in terms of revenue we would probably be about 20 – 22% larger than we are currently. I see a lot of that coming from digital and some of that from integrated solutions as well. As far other verticals are concerned, there are plenty. I think real estate is a vertical, which is equally turbulent but fun! I foresee a lot of real estate construction that is going to happen and they need effective marketing.      

Himanshu Thakkar, Sanjit Shastri and Tej Sahni, who founded Beehive 12 years ago, have sold almost their entire stake in the agency to the worldwide communications network. Shastri will continue as the CEO of the agency and has been inducted on to Publicis Worldwide's India management board. Publicis Groupe currently counts more than 3,200 permanent employees across India, through the following global networks: BBH, Digitas, Leo Burnett, MSLGROUP, Publicis Healthcare Communications Group, Publicis Worldwide, Saatchi and Saatchi, Starcom MediaVest Group, and ZenithOptimedia. In July, Publicis and Omnicom announced plans to merge their global operations, making the new entity, worth $35.1 billion, the biggest advertising group in the world.