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28 OCT 2015 RESEARCH & IDEAS

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A Dedication to Creation:
India's Ad Man Ranjan
Kapur

08 APR 2013 RESEARCH & IDEAS

HOW TO DEMOTIVATE
YOUR BEST EMPLOYEES
01 JUN 2016 WHAT DO YOU
THINK?

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How do you build a brand amid the uncertainties and opportunities of a

developing market? Harvard Business School Professor Sunil Gupta shares
lessons learned from Ranjan Kapur, an iconic figure in the Indian
advertising industry.

WHEN BUSINESS
PERFORMANCE FALTERS,
IS CULTURE CHANGE THE
FIX?
31 MAY 2016 HBS CASE

WHO OWNS SPACE?

20 SEP 2010 RESEARCH & IDEAS

by Sean Silverthorne
One day in 1966 while Ranjan Kapur was walking in midtown Manhattan, a
black limo pulled up alongside. A man he instantly recognized as
advertising icon David Ogilvy, founder of the agency where Kapur had
recently been hired, stepped out and greeted him by name. The two men
proceeded to have an hour-long discussion driving around the city.

POWER POSING: FAKE IT

UNTIL YOU MAKE IT
30 NOV 2007 WHAT DO YOU
THINK?

WHAT IS MANAGEMENTS
ROLE IN INNOVATION?

Young Kapur had just joined the firm Ogilvy & Mather after a brief stint at
Citibank, where hed decided he needed a more creative career. His
conversation with Ogilvy confirmed that hed made the right decision.
The Indian culture was still very fascinated by the old British style of
operation. And advertising was seen as a glamorous thing
Kapur discusses his years as a developing ad man and eventual executive
chairman of O&M India in a new interview with Sunil Gupta, the Edward W.
Carter Professor of Business Administration and Chair of the General
Management Program at Harvard Business School.
In the discussion, conducted last August in Mumbai, Kapur reflects on
some 50 years in the advertising industry, starting in the Mad Men era of
the 1960s, experiencing the dawn of the digital revolution, and ending with
his retirement in 2003. He is now active mentoring young entrepreneurs,
investing in companies, and painting.
The interview is part of the Creating Emerging Markets
series sponsored by the HBS Business History
Initiative, in which business leaders in Africa, Asia,
and Latin America discuss their experiences growing
businesses amid the opportunities and uncertainties
of developing markets throughout recent decades.

SUNIL GUPTA
Sunil Gupta is Edward W.
Carter Professor of Business
Administration
Chair, General Management
Program at Harvard
Business School.
CONTACT

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Working Knowledge Editor-in-Chief Sean Silverthorne asked Gupta about

his experience interviewing Kapur.
Sean Silverthorne: Kapur comes through as very passionate about
advertising. What is it about advertising he likes so much?
Sunil Gupta: Advertising is a right-brain activity, the art of creating
something from scratch. Also, advertising is all about understanding and
connecting with people. He seems very much a people person, somebody
who likes to tell stories rather than play with numbers. For some people
numbers speak, but I dont think numbers speak to him.
I give him a lot of credit for realizing this early on. Back in the 1960s a
Citibank offer was like a golden ticket in India. People wouldnt leave that
job, and Im sure his parents were very upset when he did.
Q: You have a fascinating exchange where Kapur tells you what it was like
to work at an ad firm in India, which in the 1960s and even beyond was
still feeling the vestiges of the British Raj. He says, if you spoke English
with a slight ho-ho accent then you were better off in the advertising
business, and you rose in the advertising business. It worked for
everyone. We all acquired a slight accent at that time.
A: India got its independence in 1947, and even in the 1960s the country
was still very heavily influenced by the British Raj. I learned in the
interview that the people the advertising industry in India was hiring in
1960s were all English-speaking and English-educated graduates from St.
Stephens College and other elite schools of India that were more like
British schools that Prince Harry would go to.
That was surprising to me given that India is so diverse with so many
languages spoken and advertising is a people and communications
business, so why wouldnt you hire people with proficiency in local
languages instead of English? I think that was a leftover from the British
Raj. The Indian culture was still very fascinated by the old British style of
operation. And advertising was seen as a glamorous thing. You were dealing
with multinational companies coming from the United Kingdom and the
United States, so it became much more of an elitist culture.
Q: What was the economic scene like for entrepreneurs in India during this
period?
A: In the 1970s and 1980s, the Indian economy was clamped down. A lot
of constraints were put on growth of companies, until Rajiv Gandhi became
prime minister in 1984. Before that, a lot of multinationalsCoca Cola,
Pepsidecided to leave because the government wanted them to give a
majority equity stake to their local partners. As a result, Indian companies,
especially the ad-buying agencies, went through tough times because their
large clients decided to leave the country.
The first question HBS faculty get when we do a custom Executive
Education program in China and other areas is, How do I build a brand?

ADVERTISING
ENTREPRENEURSHIP
SOCIAL PSYCHOLOGY
STRATEGY

ASIA

Also, the government at the time had a socialistic leaning. Advertising and
marketing were not considered good things. You had so many poor people
in the country who couldnt even put a meal on their table and here you
were trying to sell Coca-Cola or fancy products that were not necessities. So
there was a lot of debate in the country, certainly from the politicians,
about whether we really needed that. And even more recently, when Pepsi
came back, you heard many people saying, Silicon chips, yes; potato
chips, no.
Q: When did India become more of a business-friendly country, especially
for advertising?
A: That changed with the opening of the economy in the 1990s. Two things
happened. All these global companies came back, which helped the
advertising industry. And the economy grew, which meant the middle class
grew rapidly. The Indian middle class is huge; you are talking about 400
million people. As the middle class grew with large disposable income, and
these foreign brands returned, it pushed the local brands to improve their
quality and services. Competition rose and consumers benefitted.
Q: So at this very fortunate time, Ranjan Kapur comes back to head O&Ms
India operations. He had been serving in the very successful Singapore
office, but O&M India, headquartered in Mumbai, was not so successful,
ranked as the fourth largest firm in the country and heading toward number
five. In pretty short order, he built it into the top agency in the country.
What did he do?
A: He looked at three major things. One, there was a bit of a myth within
his company that we arent big, but we are very creative. Somehow, being
big and being creative were considered to be at the opposite ends of the
spectrum. He challenged that assumption. Why cant big companies also be
creative? That was the first mindset he changed. That takes more time than
one might imagine because of the entrenched culture in place.
The second thing was empowerment. Every single recruiting decision (in
the country) was being done by headquarters. That doesnt make sense
when you are growing at such a fast pace. He learned that in Singapore:
Empower the people to take action.
The third thing was this balance he created. He talked about the threelegged stool. Kapur was one leg, the finance director the second, the
creative director the third; each had equal power to act. You give enough
rein to the creative people so they can experiment. But there is also the
business side of the operation, which is making sure clients are getting
what they want. Its not great if the creative people are winning awards but
the clients arent getting the business results they want. So Kapur managed
the organizations structure by giving enough power to the three groups but
no one person was dominant over the others.
Q: As you said, changing an entrenched culture is difficult. One of the first
things he did was to lay people off, to make it a smaller organization. To
those who stayed, he gave more autonomy and more money. So clearly a

signal was given: Dont get complacent. You have to earn your keep. And if
you do, you will be rewarded.
A: Thats right. And people can accept more responsibility if you let them.
That was a smart move because the advertising industry doesnt pay very
well compared to consulting, investment banking, and many other jobs. So
the question was, how do you attract talented people and motivate them?
For Kapur, it was by the monetary incentive, by the nature of the work, and
by instilling the ambition and aspiration that we can be number one. It was
the combination of those things.
Q: On the subject of brand building, Kapur is very keen on the idea that
brands take a long time to build, there are no shortcuts. He says, One
[piece of] advice that I would give is to make absolutely sure that you are
not running away from your market to build the global brand. You first build
your brand in your home base because then you understand the character
of your brand, the virtues of your brand, and understand the core that
drives your brand. And if you respect that core can drive any human being
wherever they reside, then that brand has the opportunity to become a
global brand.
A: The first question HBS faculty get when we do a custom Executive
Education program in China and other areas is, How do I build a brand?
Because thats where a lot of value gets created. In many emerging
markets, whether its China, India, or Turkey, when a local company gets
big and has reasonable cash flow, they decide they need to become global.
And the way they think about becoming global is to buy a global brand,
hoping that the magic will rub off on the local brands. That usually doesnt
happen.
Godiva was bought by lker in Turkey. But while the Godiva brand is up at
the top in image, lker is a significantly lower image brand; the consumer
doesnt see a connection. Its as if Levi decided to make a fancy Italian
suit. Im not going to believe in the brand even if they make a nice suit,
because my image of Levi is of it being very casual. What we see is that the
image change happens gradually. You build a Honda Scooter, then a Honda
Civic, then a Honda Accord, and then an Acura. There is a lot of theory and
research on how consumer behavior and perception changes over time. And
that change in image takes 10 to15 years.
Many companies have a difficult time understanding this. They are eager to
go to a global market by buying a global brand because they have the cash
sitting on their balance sheet. So it was interesting to hear that Ranjan
Kapur was on the same wavelength about brand building.
Q: Digital is transforming advertising and some fear that the romance of the
industry, the creative passion, is being subsumed by data, analytics, and
ROI. Kapur is bullish on digital but sees a big shakeout coming. I suspect
you share that vision.

A: Absolutely. A lot of things have changed in the advertising world.

Advertising used to be all about how many people I can reach, and how
many times I can tell the same story to them in hopes that they remember
it. Reach and frequency was the metric and the gross rating point (GRP)
became the terminology we all used. With digital, you can target people
much better because you have more information about them. I can measure
it. I can personalize itone of my former students built a company that can
customize a video for a million different versions. So that part has all
changed: targeting, personalization, measurability.
The second thing that changed is that in the old days, the firm told you
what it wanted you to hear. Now, consumers learn about a product in
different waysreceive directly from the firm through traditional or digital
advertising, seek out information themselves through search, or learn from
other consumers and social media. Many of these things are out of control
of the firm. So as a marketer, you have to start thinking about how you
influence the way consumers obtain information and get influenced.
The third thing that has changed is around media buying. For a long time,
ad agencies were compensated 15 percent of their media buys. There was a
large media planning group in all these agencies. Now you have
programmatic buying; the algorithm does all that. There is no comparative
advantage in media buying anymore.
So suddenly you need an engineering mind, you need a data-analytics
mind, and you need the data scientists who work with Google and
Facebook. Thats a very different skillset. Martin Sorrell, who is the CEO of
[advertising giant] WPP, has a famous saying: Weve moved from the Mad
Men era to the Math Men era.
Kapur came in with a right-brain aptitude, much more of the creative guy,
but now companies are suddenly asking for ROI. But you cant compete
with Google on Googles turf. You still need the creative. So you need to
merge the right and the left brain. But combining these two is a challenge.
Q: India has taken something of a rap for not being an entrepreneurial
culture. What is the state of entrepreneurship in the India?
A: Indians have always been entrepreneurial in spirit. I remember growing
up in India and noticing that people always found a way to get things done.
But when it came to jobs, people were risk-averse because unemployment
was high, and you were worried what would happen if you left your job to
start something new. Also, there were no role models in India, no Bill Gates
or Mark Zuckerberg to show us that it can be done. In India, the impression
was that, unless you were born into the right family, you just couldnt make
it. Third, the venture capitalists never came to India until recently. They
were partly worried about regulations and red tape and whether government
would change the regulations. So even if you were willing to take the risk,
no investor was willing to support you.
That has slowly changed with the opening of the economy. The floodgates
are starting to open now.

Q: For entrepreneurs in India today, what is their approach to starting a

business? Do they think local or are they born global?
A: Many start local because India is a huge country. A few years ago I
talked to entrepreneurs there and asked them, Are you simply cutting and
pasting the US model of your business to India? Is your version of Uber
based on the US model? And yes, that is how they start. But then they
realize the implementation is very different. The logistics are different, the
structures are different, the consumer behavior is different. They start with
the same business model but it quickly changes by 180 degrees, or at least
90 degrees, in the process of execution.

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COMMENTS
Rammohan Potturi

7daysago

Working Knowledge Editor-in-Chief Sean Silverthorne shares Prof. Sunil Gupta's

experience of interviewing India's Ad man Ranjan Kapur and that makes an interesting
reading. Indian business and the market conditions are peculiarly different and any
attempt of using US or UK models of advertising of brand building do not fit to our
requirement and seldom give results. The nature of absorption of Indian consumer is down
to earth Indian. It does not reflect any of the parameters previously used in a country
outside India successfully. The total advertisement for any product in India, right from
copy writing to the shoot must carry the Indian local situation/s as a back drop and must
convince the ordinary consumer to get connected to the subject of the advertisement.
Other wise it goes waste ..down the drain. (recent example of a hit advertisement - Airtel
4G and also of Vodafone ) After all advertising is matter of transparent communication.
Like Reply

mangal

8daysago

In sixties and seventies, though advertising business was dominated by Suits and Convent
educated Sahibs, back end was captured by vernacular creative minds. It is only now they
are given the credit due.
Like Reply

Vks

8daysago

Thanks for sharing.Enjoyed reading.

Like Reply

Suresh

8daysago

Suresh Rao
Advertising in India now is Indianised.....which means not anglicised and yet not localised
as India is a very heterogenous market.
Like Reply

Brian

8daysago

I enjoyed reading the article a very good way of explaining the evolution of brand building
and creativity
Like Reply

Rajendra

219daysago

Nice post, full of insights. Interesting style to deliver heavy messages.

Like Reply

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