Building a new Dentsu
If 2021 took Dentsu India on a downward spiral with all the talent exodus, 2022 became the year of crowning glory for the Group, when they won the ‘Agency of the Year’ at Cannes Lions, a title which had eluded not just India but also the Dentsu network globally. But for the leadership team, which went up on stage to collect the coveted award, it appeared that the flash of success was also accompanied, in equal parts, with anxiety because some of the star performers of the winning campaign had already parted ways with the group. The moment surely was sealed with dazzling success but was the future too? 2023 thus went on to become a year of ‘rebuilding.’ After making structural changes, the Dentsu leadership chose Harsha Razdan as their Atlas to hold up the mighty Group in India. But of course, unlike Greek mythology, Razdan’s On their week-long India visit, two top leaders of Dentsu globally— Jean Lin, Group President of Global Practice & Will Swayne, Global Practice President of Media were radiating confidence in the future roadmap of the Group here while acknowledging everyone who has contributed to the success of Dentsu in the past, “We are so grateful to have had the opportunity to work with such good talent, even though some of them are not with Dentsu today. They will forever be a part of the Dentsu family.” Razdan, when he took over, had a tabulated list of 75 top Indian clients who he wished to bring into the Dentsu fold through exhaustive one on one meetings with brand CEOs. It was a task that he carried out with diligence in the past 12 months. He claims that as of 1st January, 2024, 40 of them are already on board, even though he was tight-lipped about the names. So, while we await the news stories on the successive accounts won by Dentsu in India this year, we can confidently call it work-in-progress or a battle half-won. All eyes on Dentsu and Razdan to see if 2024 can be their turnaround year and if he really succeeds in reinventing the network in India. Q] There was a time when agencies complained of consultancies entering their space, today all agencies are also doing what consultants do, striving to have a strategic and fundamental impact on the client’s business and going beyond campaigns. At Dentsu, last year, you went a step further and hired your South Asia head- Harsha Razdan from a reputed consultancy, KPMG. Today what is the resultant transformation you are seeing at Dentsu India? Q] Dentsu suffered a net loss in FY2023 (A$109.5 million/ 10.7 billion yen). Japan was the only region in which the group reported positive organic growth, with the region accounting for 40% of the group’s net revenue. How did India fare? Q] Your past two Global Chief Creative Officers were from the west, be it Gordon Bowen or Fred Levron. However, Yasuharu Sasaki, who was elevated to the top global creative role in October, is from Japan. Most agencies like Ogilvy have brought in Global CCOs from the region where the network was not performing well, to improve the results there. In contrast Japan is your best performing market. What was the strategy here? Q] The APAC region (excluding Japan) contributes to only 10% of Dentsu’s total revenue, where does India stand in the pecking order there, how important is the market for you? Q] With the simplification of structures, which of your clients are working across multiple disciplines and practices at Dentsu? Q] In the past couple of years, you lost many creative accounts, namely Airtel, Ikea, ITC- Fiama, Urban Company, Meta etc in India. While Amit Wadhwa’s team has been firing and has recently won accounts like Sony Entertainment, Motorola, Bharat Benz etc have you managed to mitigate the earlier losses? What is the target you have set for him? Q] Dentsu won the ‘Network of the Year’ Award at two Asia Pacific Advertising festivals this year – Adfest and Spikes. You also won the Regional Network of the Year for Asia second year in a row at Cannes Lions in 2023, ditto at the LIA awards. But how soon will you transcend the Asian boundary in the awards recognition at an ‘overall network’ level. Is this going to be Dentsu’s year at Cannes? Q] As per the Comvergence Barometer none of the media agencies from Dentsu have made it to the top 3 in India for 2023 in new business wins or in size of business. Does that trouble you? What is the goal you have set for Anita Kotwani in India? Q] What is the breakup between globally aligned clients and local clients at Dentsu in India? Q] The Dentsu-e4m report says that the digital advertising industry is expected to grow at 23% CAGR by 2025. Are the billings at Dentsu, which is historically known for being digital-centric, reflecting that growth. What is the break up between digital and traditional? Q] Dentsu folded 160 global brands into six, a few years ago, but in 2023 you acquired Tag to bolster creative production because there was a need for it. Are there any other such acquisitions on the cards, especially in India?
Atlas-esque role at Dentsu India is a challenge and not a punishment. The question here is, whether he can deliver and turn 2024 into the year which will bear fruit for Dentsu in India.
Talking about the transformation that the Group has been working towards since the past three years, Lin adds, “After I took on this role, last October, many people called me to say that they now see the point in the simplification of structures here. Some even wanted to discuss their return to the company. I was very happy when Harsha (Razdan) told me that he managed to bring Narayan Devanathan back to Dentsu. At the same time, we are being joined by a lot of new talent and are extremely focused on Gen Z right now,” says Lin.
Another aspect of their emphasis on Gen Z will be demonstrated in how the Group Chief Creative Officer role at Dentsu in India will play out. While there have been a few key hires on the creative side namely Abhijat Bharadwaj who has joined Dentsu Creative as CCO – Digital Experience, Joy Mohanty, CCO – North and Surjo Dutt, CCO, West and South regions; the position of Group CCO lies vacant after Ajay Gahlaut’s departure in Feb, 2023.
Lin explains, “We definitely want to invite great creative talent to join us, Harsha has some big plans there. At the same time, we are conflicted about whether the traditional Group CCO role will lead to the right model for Gen Z talent and move the business forward. In parallel, we’re thinking of how we can create parts of the capability that will connect with each other, while also enabling younger talent to have a bigger stage. We are evaluating both sides.”
On the media side in India last year, the network hired two CEOs from outside the Dentsu ecosystem - Jose Leon for Dentsu X and Sanchayeeta Verma for Carat India. Both are reporting to Anita Kotwani who has been tasked with getting the network back on track after the loss of two big accounts, Reckitt and Maruti, with a billing size upwards of Rs 1000cr each. Swayne has immense faith in the leadership, “The team has done a really good job of going back into the market. Anita and the leadership team have really stabilised the business following those two losses. There is a full pipeline of new opportunities, and the outlook for the year is very good. We’re looking forward to filling that gap.”
The network in India shared that they have won a total of 108 Media accounts, 26 Creative accounts and 46 CXM accounts since March 2023, some of them being Aditya Birla Capital, Motorola, Sony Entertainment Television, Sony SAB, Sony MAX & Sony MAX 2, Skore, Eva and MsChief, Bharat Benz, Gemini Oils, Drone Destination on the creative side and Welspun, Berger Paints, Bharat Benz on the media side.
Harsha Razdan who is currently steering the Dentsu India ship, took over the top job here in 2023 after lack of clarity on who will be the candidate to take Dentsu into the future here, for close to two years. Razdan jokes that he was half expecting the Dentsu clients to pounce on him with a list of what they might have thought was wrong with the network. He was also sceptical about whether they would, in the first place, agree to meet ‘the outsider’ in the agency world. However, Razdan was in for a surprise. He recounts, “When I went to meet the CEOs personally, they told me -- you are trying to break down the hierarchy and attempting to change the way Dentsu is going to work, with an open mind. They wanted to hear my ideas. So, it helped me and I went on to meet more and more CEOs thereafter. I understand now what diversity means because I am the diversity candidate for the industry and I genuinely believe that our model is good. We just lost our way briefly. Dentsu with Jean, William and other leaders on board has just released the trailer of the good part, the full film will be out soon.”
For an agency which seven years ago had released a campaign calling itself the No. 2 network in India, the goalpost has definitely changed. Swayne clarifies, “The target for us is to support our clients and to deliver results for them keeping in mind their growth ambitions. And we will do that through a collection of capabilities, our client’s growth ambitions are our ambitions and their success therefore becomes our success. We will be happy as a network and organisation, if we can deliver that against the earlier No. 1 Dentsu ambition and goal.”
Lin adds, “Our target is to be successful for the next 120 years, for that one has to think specifically for the future and be committed to nurturing it. We are very excited about the direction we are moving in, globally.”
As for Dentsu India, 2023 marked the beginning of a new chapter, one where Razdan gets into the thick of all the action, to lead from the front. But while he was and is continuing to do all the heavy lifting, the task for the others in the leadership team is also far from simple. Razdan’s mantra is simple after all, “At Dentsu, you have to manage the client yourself. Otherwise, you don’t deserve to be on the leadership team. You can’t be in the top league at Dentsu, if you are only ‘advising’ others to do the work.”
Jean Lin, Group President of Global Practice & Will Swayne, Global Practice President of Media along with Harsha Razdan, CEO, South Asia at Dentsu tell Neeta Nair, Editor of IMPACT Magazine as to how Razdan’s leadership has brought stability to the Group in India and how they are now attracting not just the right clients, but talent too
Jean: Dentsu focuses on the future and that’s why we are always evolving. We want to set the benchmark in helping clients prepare for the future with our capability in marketing, technology, and consultancy services. That’s why we don’t look at any specific domain for all our key hires. We believe the leader with the right character will help harmonise, integrate, and connect all our capabilities to solve clients’ biggest problems. It has been a very pleasing journey with Harsha. One of the key Dentsu attributes is to lead with the client at heart and Harsha demonstrated that phenomenally by listening actively, putting together solutions and teams that can help the clients. He has met over 100 CEOs in India and the energy that he puts into being the client’s growth and transformation partner, along with the way he solves their problems gives a new dimension to how we operate in India. We are really fortunate to have him.
Harsha: When I joined Dentsu, the first thing we needed was stability within our own company in India because we didn’t have a leader or a head for some time. Clients oft asked me questions like ‘Are you back?’ But fact is, we were never gone. It was just one blip in the 123-year-old history of Dentsu. So, 2023 was all about getting client confidence back. We have repositioned ourselves, and are not just creative, media or CXM specialists today. If a client has a marketing problem, we will solve it no matter what practice it takes. So, last year, having stabilised as a company, we are looking strongly upwards, and it’s not about media or creative anymore; it is 20 times bigger. What matters to me, is not ranking but profitable and sustainable growth. In fact, competition for me is not about comparing Dentsu with some other traditional companies. Anyone who tries to snatch anything in the broader framework of marketing from Dentsu is my competition, be it Accenture or IBM. I will use everything in my armoury to cover that space.
Jean: So, Yasu is the most awarded creative leader in Japan, he has worked in New York and is well recognized globally. Yasu started as a computer science major to become a copywriter, and then went on to set up Dentsu’s R&D lab in 2014. He is now in the right place to influence and inspire the organization to move forward. Our key belief is in elevating the best talent regardless of where they are based.
Jean: When we look at India as a market, it goes beyond the financial figures. India will be the future, and we are committed to investing and setting up our global delivery centre here which will enable Dentsu the world over. India is not a geography; it is a centre of excellence and a key foundation for us to drive our network talent strategy. Apart from the services barrier, we want to break the geographic barrier. For e.g., my global team is not based in one place. Technology has enabled us to give talent the best opportunity, regardless of which market they choose to live in.
Jean: Majority of our Japanese clients embrace all our capabilities. We want to bring the eastern thinking to the west as well as the best of capability innovation from the other side. We have had quite a good track record in the past few years. Apart from the Japanese clients, for those like General Motors, American Express, as well as for some of our recently won clients - Royal Canin, Ferrero, T-Mobile, Lowe’s we have put together many different capabilities. But our model is not to say we integrate agencies for you, Mr. Client. Our model is to say, we solve your problem, you don’t need to care from where within the Dentsu Network it is getting done.
William: We were structured on the service lines, and the CEO/Head of each service line was focused on the P&L. Now we have taken down those individual P&Ls, to be able to get in place leaders who are focused on the practice, namely - Media, CXM, Creative and Business transformation. And all of them are really focused on driving the craft of each of their areas and bringing them all together to solve the client’s problems. We also have integrated solutions as a fifth pillar, which essentially are pre-packaged capabilities that we know are integrated by design like Gaming, Dentsu Good, etc.
Harsha: My belief is that there’s only one person who owns P&L in Dentsu which is our big boss, Hiroshi Igarashi. Rest of us, including me, are just carrying the legacy on his behalf. In fact, in India no Dentsu agency or person gets rewarded unless the overall India numbers are looking good. Basically, if only Carat does well and India doesn’t, they can be prepared to say goodbye to their bonuses.
Jean: I want to say that I’m extremely impressed with the current team. It gives me so much confidence. I’m really happy about where we stand right now. It’s like a new Dentsu and we are really building it up.
Jean: Well, India did break that boundary on the global stage by becoming the ‘Agency of the Year’ at Cannes in 2022. While we appreciate awards, we don’t work for them. Nothing inspires us more than delivering the right results for clients. And in the process, of course, getting recognized by competitive awards because it helps us to also attract talent and clients. Therefore, we also have intra-Dentsu awards. Watch this space because we hope to do well in all awards, even if it is not our focus. Our focus is on client centricity, solutioning, and business.
William: While that was indeed the result for 2023, we have had a long history of being on top of the league. The nature of the agency business is quite cyclical and you sometimes end up having a year like that. I spent the past couple of days with Anita and her leadership team and I’m really pleased with the momentum that they’ve built. We have had some great local wins like Berger Paints and some great international wins like Ferrero, Carlsberg. And what’s really important about those wins is that while we win globally, we have to win in every market too. And so the real strength, as Jean was talking about, is in how the network is teaming up across markets and securing those wins. So, Anita and the team have been a big part of those network level wins as well as wins locally. I am happy with the way they are progressing and the leadership team that she has built.
Harsha: Around 75% of the business is local because we are a very domestically oriented consumption economy. Half of the remaining business is Japanese and proudly so, we are strengthening that.
William: If you look at our billings in India, over 50% are digital. We have a leadership position in digital performance here. We’ve got real heritage in building a strong digital profile as an agency group and ensuring that we are leading as a digital global network because the future is going to be 100% addressable, 100% shoppable and 100% accountable. And so, it’s really important that we continue to lead in digital performance. So, Sokrati and iProspect—our two strong digital performance brands are powering that growth.
Jean: Our current focus is on integrating and connecting all the capability that we have. We want to ensure that we pave the way for the talent that joins us through acquisitions so that they have a holistic career at Dentsu. The Tag acquisition is a really important one because it gives us the capability to create intelligent content at scale, and in future effectively decarbonise the content production process to help our clients achieve their sustainability goal as well.
Harsha: Whether it’s acquiring talent or acquiring companies, we’ll do it the right way moving forward, so that it’s sustainable for us. There were phases in the past where we acquired a lot of them. Here on, it’s going to be very calculated. I have a 3000 strong team at Dentsu India but outside of that, in the country there are 7000 people who are servicing global clients. So, all that becomes available to me. Let’s just say that, you’ll see a different Dentsu 2024 onwards.
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