The Hindu Business Line : Euro RSCG bags three new accounts

THE Chennai branch of Euro RSCG, has added three new advertising accounts to its kitty - Sumeet brand of home appliances (mixer and grinder), Hatsun Agro and Marshall (both Chennai-based businesses).

Mr M. Venkataraman, Senior Vice-President of the agency, however, preferred not to divulge more details regarding the nature of the businesses or size of the accounts.

The wins have happened at a time when new accounts have not been forthcoming to the city's agencies. In an exclusive to Business Line, Mr Venkatraman said that Euro RSCG has now equipped itself to handle the recessionary conditions. "This is the new reality - margins being squeezed or agencies' commissions under pressure. We have to live with that," he said. Falling revenues have forced most clients to cut costs in order to remain profitable. This `bottomline focus' has had its implications on the fortunes of advertising agencies.

"Earlier the agency's focus was to think in terms of a 30-second commercial which would help in getting the client's product off the shelf. Now, we have to think in terms of converting the client's `loss-making brand into a profit-making brand.' In that sense, our focus has shifted," he said.

The entry of multinational media buying units has also had its effect on agencies. Mr Venkatraman explained that the entry of large media buying outfits has further reduced the size of the pie and has "forced agencies to work harder for their share." In fact, even Havas' media buying arm, Media Planning Group (MPG) recently set up shop in the country. (Euro RSCG belongs to the Havas group.)

"Media buying agencies are here to stay and clients have clearly shown their preference for working with them," he said. This means ad agencies are now back to what they know best - `creative'. And offering marketing inputs through a gamut of functions such as research, direct marketing, events, sales promotion or public relations. "You restructure your creative product and offer an array of services along with it. The client then pays for the product - either a commission or a fee," he added.

Acknowledging the changing business environment, Euro has been evolving its offering globally. Its worldwide corporate vision of `Creative Business Ideas' looks at new methods of catering to a client's business and communication needs. It has also introduced The Sales Machine, a database-marketing initiative, which has signed on clients such as Hindustan Lever Ltd and Voltas among others. Last year, the agency reported capitalised billings of around Rs 250 crore.

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