Approached by Dentsu, Cheil, but we wanted the creative legacy: Manish Bhatt

After operating as a successful independent agency for 8 years, Scarecrow Communications has been acquired by international network, M&C Saatchi. Now rechristened Scarecrow M&C Saatchi, the agency will retain its own identity but there will be an integration with the global financial processes and compliance practices. 

Speaking on the development, the 3 founders of Scarecrow – Raghu Bhat, Manish Bhatt and Arunava Sengupta – in a joint statement admitted that they’ve had many suitors in the past few years. “But after meeting Moray MacLennan, David Kershaw and Jeremy Sinclair in London, we were clear that M&C Saatchi is the perfect partner for Scarecrow. Why? Because they have entrepreneurship in their blood. The culture of M&C Saatchi, that sprung from the personalities of the brothers themselves – irreverence, low tolerance for jargon, challenging the established order and the history of many larger-than-life campaigns – are qualities we identify with,” they added. 

Adgully spoke to Richard Morewood, CEO, M&C Saatchi, Asia, as well as Raghu Bhat, Manish Bhatt and Arunava Sengupta to know more about the implications of such an acquisition, the strategy going forward, assimilating into a global team, moving ahead as a combined entity and much more. Excerpts: 

It’s a good day to do business: Richard Morewood

What led to this association with Scarecrow?
We are well aware of the fact that India is a very important market in the global network and a market where we need to have our significant presence. We have our presence in New Delhi. We have two approaches: the primary approach is to be associated with start-ups as we are a start-up based company. We began that way 23 years ago and have built most of our offices that way. But where there is a critical market where we need presence and we can’t find that, we need to get the best talent and when we can’t find the best talent to do a start-up, we see if the best talent has the potential for acquisition and that’s what happened with Scarecrow Communications. We wanted to know the guys and hence, the courtship began. Although the conversation took a little time but it happened, not because just they were busy, but also because we had to understand each other and see if the network will work in the cultural alignment. 

It’s been likeminded people working together on the quality of work and quality of thinking, but sometimes things take time but these guys are really passionate about their work. 

How did you zero in on Scarecrow Communications for this collaboration?
I came in at a time when this deal was already being discussed, but I think we probably did look at other agencies. However, as I said, it’s all about being in line with cultural alignment and the quality of work and being likeminded. That’s what attracted us to Scarecrow Communications. 

Is this the first time that M&C Saatchi has associated with an Indian agency for creative establishment?
We have been present in the Indian market before. But we have been associated with various start-ups. One challenge with them is that some work and some don’t. But this is the first significant move in the company, where we have partnered with a big established agency that’s doing some great work. But we are still developing further through these guys, helping them expand their current offerings and giving them some different offerings. 

What are the major changes that will be working at Scarecrow M&C Saatchi post this acquisition?
We are not really looking at a lot of change. We are here to help them grow and flourish and grow them into an even bigger business. However, that does not mean that we need to change them. We just need to give them more opportunities, resources and help them tap into more opportunities to let them grow organically. Then, we have these group offerings that we don’t have expertise and presence in the Indian market, where Scarecrow can help us integrate with. It just means opening up the opportunities for both sides. 

What kind of clientele would now be open to Scarecrow and vice-versa?
From the client perspective, we have a huge experience in Telecom, Banking, Tourism, Airlines, etc. So, there are various sectors and case studies that can be used by Scarecrow. From a digital point of view, we have better digital capabilities from which they can leverage the strengths from the network. 

With such big investment done in this merger, how do you plan to put the big sum to good use?
It is an investment in growing our businesses, which we don’t do very often. Some of the other big groups like WPP and Publicis have spent their lifetime doing acquisitions. That’s how they build the business. You do investments to get the returns, but our investment is aimed at the future as India is very critical, we want to work with the best people and we have found the same in Scarecrow Communications. I think it’s a good day for everybody and a good day to do business! 

We’ll continue to add more bricks to this foundation: Manish Bhatt, Raghu Bhat & Arunava Sengupta

What has been the sole reason behind this merger after three years of contemplation with M&C Saatchi? What are the changes that you expect with this merger?
You don’t just start to fly, there is a wind and then you flutter and begin to fly. So, a few years ago some of the other networks had approached us for mergers, like Dentsu, Cheil, etc. Then we considered an association like this. The way we structured our management, we don’t think about everything only in terms of encashing money. What we like here is the fact that there is endearment in creating this association. It took us time to come to consensus for the three of us as we scrutinised the deal too. So, putting together, one thing that we wanted was the creative legacy. Saatchi is a great name in the creative field. To partner with such a brand name and interacting with their management, we pretty much got convinced with the deal they offered. It took time to finalise everything. Besides this, the entire DNA of simplicity, the entrepreneurship and freedom that comes with this merger, who would not like to get into such a relationship and we saw a match and then we tick-marked! 

What are the structural changes that will come with this merger?
They will be according to the SHA – the Share Holding Agreement. Besides that, we have been the intrinsic face of Scarecrow and we will remain to be there this way in full throttle. However, now we have two brand names that are trying to help each other and then the expertise that we both will help each other with. In the end, we both believe in simplicity of ideas, and we work on the fundamentals of not doing mere lip-service, we genuinely work behind something and if that works, only then do we talk about it. 

With more international clientele being open to you, how do you plan to strategise your planning with them?
The international world of business is changing; clients seek value wherever they find it. We are not rigid anymore, which means we are open to working with multinational agencies. But with this association, we think that our core creativity will get new wings now. It will get new allies, new expertise and because of that we will now be able to make more number of pitches and will be able to present different kinds of propositions to the clients. 

What are the other areas of expansion that you are looking at?
We believe that it’s very important that you stick to your core. It’s, therefore, critical to identify which areas and fields you will enter where you can offer your core. Our outlook towards expansion is our traditional offerings. We want to do more in our traditional area of TVCs as our USP is the quality of messaging with creativity. One is, we want to increase the breadth of new offerings. Also, using creativity with the help of technology to enter into a few other new areas. We don’t want to just start with five new offerings from tomorrow, but underline and reinforce our core offerings and one or two areas where we can use technology to improve our offerings. 

Scarecrow began as an independent entity. How much of independence do you see being retained by you post this merger?
It is like a marriage, a bride sees various prospects and can even reject them all; we saw only four-five. The reason it took time is because it cannot be rushed. It has to take its natural time and during this relationship building period, you identify the strengths and details of your partner. During these three years, we observed the ways that M&C Saatchi works and now there will be no rude surprises for us later. 

How much do you believe in Maurice Saatchi’s philosophy of ‘Brutal Simplicity of Thought’?
We resonate with the thought a lot as the idea demands simplicity. But our differentiator is going to be the hard word that we put in the work; we don’t presume that things are going to happen automatically. We were not shopkeepers when we began and there was no automatic customer pull. There is a commonality between us and M&C Saatchi in that we put our philosophy first. 

Also, when we started, we were rebels. We were rebelling against jargons, structures based on egos and unnecessary complications of things. M&C Saatchi represents simplicity and the way things can be than the way things are. Simple things reach your mind faster and stay for a longer time and that is the commonality of our communication process as well. Apart from the logo change, rest of the things at Scarecrow will remain the same and simple. We are what we are! That is the true essence of it all. 

What kind of projects are you more willing to take after this merger?
Our core area of brand building and communications remains the same. We also look at this as an opportunity to learn as we have various interest areas where we may not have the capabilities like sports, mobile, etc. This partnership will help add capabilities at play. It is all about keeping your mind young and keep learning new things. 

How are you planning to boost your creative processes post this merger?
One of the biggest challenges in the industry today is talent retention. With M&C Saatchi offerings, we will probably become attractive to young talent who might know M&C Saatchi more than Scarecrow Communications. There will be a certain aspect of glamour and aspirations, giving them bigger impetus to join and stay with us. 

What kind of revenue-based boost are you looking at?
From day one, we have been financially a very conservative agency. That is one of the reasons for relative stability of Scarecrow Communications. We are all simple and down-to-earth people and that’s why we have been able to keep our expenses under control and we will continue to do this. If need be, we will invest, but we will not take any undue risks as the business environment is highly uncertain. For instance, demonetisation had impacted the industry; we don’t know what is going to happen in the 2019 elections. So, we would like to maintain the culture of Scarecrow’s eight years of steady growth. 

We would like Scarecrow to exist ideally forever, but this will only happen if there is a big spike in growth. However, we are not going to aggressively chase growth at the expense of our values, principles and happiness. Why M&C Saatchi tied with us is because they realised that we are a solid company and there is solidarity between us three co-founders and they seek certainty with us. We will continue to add more bricks to this foundation than making any other major changes.