GCPL CEO Sudhir Sitapati Advocates for a Revitalized Advertising Industry

Godrej Consumer Products' (GCPL) MD and CEO, Sudhir Sitapati, delivered a compelling address at the Advertising Agencies Association of India's (AAAI) Subhas Ghosal Memorial Lecture on January 18, 2024. Sitapati shared valuable insights on brand building in contemporary India, drawing from his experiences and shedding light on critical aspects of the advertising industry.

The memorial lecture, held at ITC Grand Central Parel, Mumbai, serves as a tribute to the influential figure in advertising, Subhas Ghosal. The Subhas Ghosal Foundation, established by senior communication professionals, aims to promote the professional values embodied by Ghosal throughout his lifetime.

Sitapati, who took the helm at GCPL two years ago, emphasized the strategic decision to significantly increase the company's advertising spend, even at the expense of short-term profitability. This move ultimately contributed to the company's success.

Addressing various issues, Sitapati positioned himself as a member of the advertising fraternity and advocated for increased synergy between agencies and advertisers. 

The CEO highlighted key factors contributing to the decline of advertising, attributing it to changes in the commission model and a fee structure that hinders investments in people and research. He referenced Ghosal's 1983 article, 'Advertising a Critique,' which called for increased spending on advertising, noting the sector's growth to 0.5% of India's GDP after 40 years.

Sitapati underscored the pivotal role of the FMCG sector in advertising, emphasizing its status as the largest spender and lifeblood of the industry. He revealed that Indian FMCG companies outperform global peers in profitability and highlighted the top five listed FMCG companies spending 15% of their revenues on advertising, compared to 10% globally.

Offering practical advice, Sitapati shared three key points for those in advertising: spend more time with non-marketing stakeholders, develop a unique perspective on advertising, and communicate it effectively with numerical data.

He emphasized the importance of understanding the CEO as the target consumer for agencies, noting that CEOs are willing to invest substantially if it drives share prices in the next 12-36 months.

Sitapati shared two epiphanies that shaped his beliefs on advertising, emphasizing the principles of being famous before getting persuasive and the significance of penetration over consumption for brand growth.

In conclusion, Sitapati urged agencies to focus on marketing effectiveness, speak more in numbers, and invest in data and people to enhance their impact on brands. The session concluded with a nod to Ghosal's book, "Making of Advertising," highlighting the speaker's commitment to the subject and its potential impact.