AURORA: HOW IS THE BRAINCHILD GROUP OF COMPANIES STRUCTURED?

RAIHAN ALI MERCHANT: We have four brands from the Publicis Groupe – Starcom, MediaVest, Spark and Publicis Media – these are franchised to Brainchild Communications Pakistan, which is the local company, and Z2C is the local holding company of Brainchild. Each company has its own set of clients. We did this because we did not want to create Chinese walls. As you expand, you tend to end up with more than one client from the same industry and when this happens, clients want to work with their own team. We took this thought process to the end, so that starting with the leadership and going down to the teams, everything is kept independent from the other companies. Each company has its own set of KPIs, top and bottom line and talent, and the teams do not interact with the other companies. Another reason for doing this is that even if the client is from the same industry, they often have different ways of thinking, different objectives and different KPIs. Some clients want to work on simple rates, others on reach objectives, and based on this, we build in specific capabilities in the teams who handle a particular client. Now, let’s look at this from another perspective. A team member has the option to go cross-category at some point; if they want to shift to an FMCG account and Spark (for example) at that point does not have an FMCG client, he or she can be transferred to another one of our companies. So there is job enrichment. Furthermore, in this context, if and when a position is vacated in any one of our companies, it is normally filled by internal people. Then, we also employ people for the Publicis Groupe’s regional accounts, and if someone is good at it and wants international exposure, we can send them to the region.

A: Is the entry point for all your employees through your management trainee programme?

RAM: It is 98% of the time. We were the first company to introduce a training programme in the industry.

A: How long has this programme been in place and how did it start?

RAM: It has been going for 20 years. When we started as a company, I did not have the luxury to go to market and find the right talent because media buying didn’t exist. P&G was our first client; 26 years down the line, we are still working with them. P&G had the same hiring philosophy in that they train at the entry-level. We learnt from them and then decided to design our own management training programme. Although the programme has evolved over 20 years, what we look for remains the same: a good education, a good work ethic and a good attitude.

A: How were the nuts and bolts of the programme acquired?

RAM: We built it internally and also took a lot of help. For the first 13 years of our existence, we were Mediacom and a lot of the material came from global headquarters. In 2010, we became Starcom, and until 2017, the group went through a lot of evolution globally, but the baseline management training programme continued. That is the technical training part. The other part is that in Pakistan, even today, very few people know what a media agency does. So part of the training was about creating excitement. For example, our trainees would find themselves on drama sets during production. This created excitement and gave them something to talk about, along with understanding how the media works; for example, at what stage of the production cycle a brand integration concept can be inserted without interfering with the content. As a business, there are times when we question why we spend so much money on this programme, but at the end of the day, it’s an investment we have to keep making.

A: You have been in this business for over 35 years; despite all the changes you have witnessed, what has not changed?

RAM: The principles haven’t changed. Advertisers come to us because we have mastered the art of showing their advertising to the people who will buy their product. That principle doesn’t change. If people spend less time reading a newspaper and more time reading the same content on a mobile handset, the only thing that has changed is how they consume the content. When we plan for newspapers, we look at the cost per thousand (CPM). With digital, what has changed is that the reach is converted into cost per impression and we talk about CPI rather than CPM. Also, because more data is available, the metrics can move from ‘viewed’ the ad to ‘engaged’ with the ad to ‘clicked the install button’. But how will someone click and install unless they have seen the ad? That principle remains the same. On the research side, another aspect to this is that globally, until about 10 years ago, we needed a retail audit; data from a consumer panel and a people meter system to measure audiences. This research was combined to arrive at a strategy for the next year. The retail audit was updated every three months, the consumer panel once a month and the ratings’ data would come in about four days later. Today, you still need the same data. However, because of digital, you can create surrogates out of this data.

A: What do you mean by surrogates?

RAM: Earlier, a consumer went to a shop to buy a SIM card and we had to wait for the retail audit to see how many SIM cards each telecom provider had sold. Today, that data is available within three hours because it has been updated live, but it’s a surrogate because it comes from one telecom app – so I only have their data – but if I know what their market share is, I can estimate the rest of the market. However, I will still need the retail audit because it has a proper sample. The difference is that surrogate data is available quickly and allows for quick decisions, but the retail audit is still relevant everywhere in the world.

A: Would you agree that consumers have changed, especially Gen Z?

RAM: Generations Z and Alpha will still consume juices or soft drinks. They are going to buy clothes and electronics. The question is, what will convince them to buy one brand versus another brand – and this is why, from a creative execution perspective, you see influencer marketing coming in. Although it is at a nascent stage, many brands are beginning to realise that it is better to do a digital video with an influencer rather than a 30-second ad.

A: What about the impact of AI?

RAM: Basically, AI learns from the habits of people. My only problem with this process is that the algorithm takes choice away because it keeps pushing the same kind of content to the same people. Yes, AI increases productivity and it is great for some things; for example, creating a new chemical component for your shampoo. AI is great at building processes and doing things faster. But in an industry where you are shoving more of the same… Look at the top three TV entertainment channels in Pakistan. They show the same type of dramas over and over and over again because the ratings tell them this is what people are watching. Search ‘Pakistani dramas’ on YouTube and the first 10 recommended content pieces will be from those three channels. The algorithm has taken the choice away from Pakistani audiences.

A: Isn’t that a ratings issue rather than an algorithm one?

RAM: Where is the experimentation? When entertainment channels first came between 2004 and 2014, there was a lot of experimentation: comedy shows, horror shows, food shows, etc. AI encourages content creators to do more of the same and that’s where I have a problem.

A: AI is also responsible for all those ads that keep appearing in between drama series.

RAM: Yes, and that is the reason for our existence – to show a brand’s ad to a consumer – and we will find every possible opportunity to do so.

A: Even if it irritates audiences?

RAM: You pay to watch content on Netflix or Amazon Prime, and it pays for the production of that content and all the rest of it. In Pakistan, no one has tried to get people to pay for content, and if they do not agree to pay for content, they will have to watch the ads. Watching ads should become a matter of choice. Amazon in Australia and in the US is working on a model whereby you don’t have to pay for the content if you choose to watch the advertisements. In Pakistan, nobody wants to pay to watch content. You pay your ISP or cable operator Rs 300 to 400 a month and you get to see pirated content; they don’t want to pay for the rights to that content.

A: So the piracy culture in Pakistan has not been dented despite all the other transformations?

RAM: We have just launched a streaming service called Begin.Watch and bought the rights to specific content. We have Western entertainment and sports, including the English Premier League and La Liga. The reason why we have taken these premium properties is to slowly get the Pakistani market to learn to pay to watch content.

A: How confident are you that audiences will do that?

RAM: It is not a matter of confidence. Someone has to start doing this to improve the content we are producing. I have waited 20 years for the TV industry to move on this, but no one is interested; they are happy making money from advertising. Maybe this will start a trend. When content creators realise that they have the opportunity to produce different content, they may start to experiment. It is about doing new content formats. If you start your version of Saturday Night Live, you won’t have 10 million people watching it – but if you get only half a million, that is all you need. In 2019, Zee5 launched a single piece of drama called Churails. Zee5 was a subscription-based app and that one drama led to about 350,000 downloads from Pakistan. It is not that difficult to do.

A: What happened to Zee5?

RAM: The PTA shut it down. But I am not bringing Indian content in. In terms of audiences, the last Cricket World Cup was broadcast on TV and was available on Tamasha and Myco. The number of people who watched it on their mobiles was almost equal to the number of people who watched it on TV. How many of the 39 or 40 million people who watched the World Cup would be willing to pay to watch? Probably only two million. The pay market will never be as big as the free one, but the idea is to introduce concept trends that the rest of the market can pick up. For the longest time we used to hear that theatre provided the talent for TV; today you can bring OTT into the equation.

A: Is Begin.Watch your next big project?

RAM: Yes. Let me attempt this. If it fails, fine; if it succeeds, you can’t imagine what the growth of content creators in this country will be. But if we don’t do this, our entertainment industry will die in the next five years. All we are doing is putting content on TV and then on YouTube, and it does nothing for the ROI. YouTube takes a big chunk of the advertising, and when they realise that other than TV, there is no other platform to air this content, they will increase their share of the revenue. In the end, the ROI will become negative and this will kill the industry.

Raihan Ali Merchant was in conversation with Mariam Ali Baig.
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