Sam Balsara on the shift in policy of mix of clients at Madison World
When asked about the agency’s performance in FY2019, Sam Balsara, Chairman & MD, Madison World, said, “FY2018-19 has been a fantastic year for us”, as against FY2017-18, which was not a good year for Madison.
Madison has 11 units and the largest offering of services spanning media, digital, activation, retail and sports management. Balsara said, “We cover almost everything that an advertiser might across these 11 units. In FY2018-19, we dealt with as many as 550 clients.”
Balsara had a lot to share with Adgully on where the agency structure is headed, how programmatic will impact media buying, why one P&L won’t work and more.
We have recently seen a spate of agency restructures and the rise of network agencies again. You were one of the first agencies decades ago to split media and creative services. Where do you think the agency structure is headed today?
From experience I have seen the success of specialisation, so I am a deep believer of specialisation. What specialisation does is that it helps create a cadre of people and gives people pride in what they do. By doing the same thing over and over again, they become experts and specialists in it, and then you can offer that superior service at a lower cost to the clients, because an expert is handling it. So, I am sold on the benefits of specialisation, however if there is any good thing you know, you can overstretch it, so I think today we are probably hitting the boundaries of specialisation to its nth degree.
But having said that, I think the need of the hour is to collaborate. Since we have so many units and servicesat Madison, we encourage our various units to collaborate a lot more than what they have done in the past and because of this focus on collaboration, we have seen that we are able to offer multiple services to the same client, which makes them happy and also because they are receiving multiple services of high quality from the same group rather than having to deal with the individual groups. We have consciously focused on this aspect for the last two years and I think we are beginning to see the results of that even in financial terms.
So, do you have one P&L now?
No, while we believe that accountability is very important, we have individual unit heads for each unit who is accountable for the P&L. But at the same time they are encouraged to collaborate and it’s the best of both worlds. One P&L is just a fancy phrase. I think at the second level one P&L will not work.
Do you think programmatic is taking over? What will the media function of the future look like?
I think programmatic is growing very well now and more and more clients are accepting programmatic as it helps bring down the cost. Anything that is done by a machine, it stands to reason that it can be done more efficiently, faster and cheaper, compared to when a human being does it. So, programmatic is nothing but machine buying. Obviously a machine, when it does a task, learns from the past and works far more efficiently.
How are you making your team programmatic-ready?
We have been ysing a large amount of programmatic in these last four years for many of our clients. Over the last two years, what has characterised Madison’s growth is actually our digital growth. Digital grew for us by some 165 per cent last year and we now have over 200 people between Madison Digital and Madison Media. A new office has been built especially for Digital.
Over the years, Madison has taken on a lot of blue chip clients and built up a very select portfolio of clients. How has Madison’s business strategy evolved over the years? Do you see Madison relying on less organic growth now?
Yes, I think that was my philosophy. When I look back, maybe I was a little vain in deciding on that and it didn’t just stop there. But over the years, I have realised that it was not a sensible and sustainable policy because the bigger the brand, the more demanding they are and the more they squeeze you in terms of demanding more and more services at a lower fee. Thus, we realised that we need to have a combination of small, medium and large clients and today, we have a rather good mix of clients. We have different systems in place to cater to each type or rather each size of client; obviously, the way we handle a very large client is different from the way we handle a small client.