At the AAAI Subhash Ghosal Memorial Lecture 2024 held in Mumbai on January 18, Mr. Sudhir Sitapati, Managing Director and CEO, Godrej Consumer Products, spoke about how advertising We explored how it can drive long-term brand growth and financial success.
His talk highlighted the link between advertising and value creation, and the important role agencies play in convincing CEOs of the effectiveness of their unique approaches.
Looking back at the brand “Adland”
Mr. Sitapati began his talk by highlighting the transformational journey of advertising over the past four decades.
Urging critical self-reflection on the advertising industry, he said, “While the advertising industry is actively building strong brands within India and for other countries, it should also introspect on its own branding and marketing strategies.” Stated.
In his call to action, Sitapati emphasized the need for government agencies to move beyond mere taglines and develop their own solid belief systems to guide actions across all platforms.
Citing controversial opinions, Sitapati says, “Brands value fame before being persuasive, brand penetration over assumptions, and shouting out to the many rather than the few.'' We should focus on the media principle of whispering to people.”
Engagement with CEO and CFO
Sitapati cited the pivotal role of understanding the target consumer in marketing, and that agencies looking to influence brand sector profitability need to work not only with the CMO but also with the CEO and CFO. he claimed.
“These non-marketers have the ability to significantly impact the bottom line of the advertising industry. “It highlights the sensitivity. Agencies need to convince brand CEOs and CFOs that their religion is the right one to follow,” he said.
Sitapati compared CEOs and consumers and pointed out the nuanced nature of their desires.
“While we champion attributes such as boldness, disruption, purpose, and sustainability, the challenge lies in reconciling these desires with investment appetite. “It reflects the facts.”
Reflecting on his experience 10 years ago, Sitapati acknowledged the persistent gap between aspirations and budgetary constraints in the advertising space.
He said: “The innovative concept of the 'Funding Game' includes a 5% marketing budget allocation to enable brand managers to explore trends such as awards, sustainability and digital within defined limits. There should be,” he said.
drive revenue
Mr. Sitapati emphasized the essential link between advertising and value creation, urging agencies to go beyond traditional metrics and focus on strategies that visibly contribute to the bottom line.
“CEOs make their views clear regardless of their public position and are often only prepared to commit significant resources if they predict it will have a positive impact on stock prices within the next six months,” he said. There is,” he pointed out.
Reflecting on the role of advertising agencies in the realm of CEOs and management consultants, he said, “In order to recognize the pivotal role of the CEO and view advertising as a fundamental driver of brand growth, we must consider advertising as just a function.'' It should be done.”
Recalling a strategic move two years ago, Sitapati said, “We significantly increased advertising spending, from 8.5% of revenue to approximately 13.5%. This significant increase is not just a matter of numbers; “It reflects a strategic decision rooted in conviction.” “Advertising is an investment in the future. Our commitment to this approach is reflected in the tangible results of a remarkable 60-70% jump in our stock price. It shows that we believe in power and position it as a key force in shaping our future success.”
This bold move, highlighted by Sitapati, was aimed at capitalizing on the belief that advertising investments contribute significantly to future economic returns, a belief that has materialized in the impressive rise in brand stock prices.
speak the language of data
Concluding his talk, Sitapati advised agents to verbalize numbers when engaging with business-oriented clients.
He summarized: “The real consumer is the one who manages the profit and loss. Therefore, he needs to leverage data for more effective decision-making and integrate marketing, advertising, and market research under one roof. there is.”
