Q&A:, Hernan Sanchez Neira, CEO, Havas Media Intelligence

'Social media-CRM combination a powerful marketing tool'

Hernan Sanchez Neira heads the intelligence arm of one of the world's top five marketing services firm, Havas. The $1.56-billion (revenues) firm-based in France is arguably the smallest in a global market dominated by Publicis, WPP, Interpublic and Omnicom. Havas Media Intelligence, its sibling organisation, works on the premise that simply getting the marketer to advertise will hardly help the brand. It starts from the consumer and then works to understand what a brand needs to do if it wants to achieve its objectives. If this sounds like another fancy name for value-added-services, it probably is. Neira, however, has had success with selling a complex research tool and methodology that allows clients to do that. The firm's work on Fidelity won a Gold Lion at Cannes this year. Vanita Kohli-Khandekar speaks to him. Edited excerpts:

Do your tools work better in a mature market where every per cent of growth is a struggle for marketers rather than in fast growth emerging markets where just coping with growth is the big job?
They work worldwide. It is a simple way of understanding a consumer and the process is universal. As a media agency, we start with the consumer, not the media. Then, depending on the brand’s objectives, KPI (key performance indicators) are set. This tool then tells us, based on the consumer understanding, how the budget should be split. For example, if there is a beer mug, how should it be marketed. Once we have figured out everything there is about the beer market and consumer, we key in all the variables. And then the tool tells us how we could allocate across media, across geographies.

Doesn’t all media buying ultimately boil down to rates?
For some years now, clients have started looking at the value adds. However, from 2008, when the slowdown happened, value became important. Now again we see clients coming back for help on strategy and consumer understanding and looking for more sophisticated technology. So, there is less commoditisation.

Are certain type of marketers, say financial services, more accepting of value adds?
The complexity of the marketing landscape and fragmentation in media means all marketers find it important. For instance, earlier, fast moving consumer goods would only look at TV. That is no longer true; they are looking at the digital space and social media.

There is so much hype about social media and the internet. But they form slivers in most marketers budgets. Is there hypocrisy at work here?
Social media and digital are gaining importance. But there is a misconception about how digital is used. You can’t buy social media. It is about the creation of apps and platforms. So it doesn’t form a part of the ad budget. It comes from the information technology budget and, therefore, doesn’t get calculated in the traditional advertising or media budget. Also it doesn’t operate the way the display (advertising) market does. It is hard to measure your competitive position in display - meaning what your competitors are doing, how much are they spending.

Is social media a phase that will burn out soon because the audience on it is largely the fickle young for whom everything is a fad, for example MySpace?
No, I don’t think so. There will be a wave of innovation every six months. Also, when social media gets connected to a CRM (customer relationship management software) it becomes a power marketing tool. Then it becomes actionable.

Your take on the India market?
We recently interviewed 30,000 consumers on 150 brands globally. We found that even if two-thirds of these brands disappeared, consumers wouldn’t care. So there is a huge commoditisation and that is a challenge for brands. They need to figure out how to become meaningful; by creating well being in an intangible way, improving the quality of interaction and dialogue with consumers, creating production systems that are sustainable. Because people want to deal with brands they trust. And technology is becoming an important part of being able to serve this need.

India is unique because the market helps marketers combine the need for strong brands from consumers with the technology to serve it. Also the relation between brands and consumers in India is a positive one. Sectors that people don’t like in other countries, like banks, pop up on the top brands for Indians like SBI Bank.