How a global ad agency thrives by outsourcing work to India

New York: New York-headquartered Group FMG, which specialises in media, advertising and marketing services, has been on a tear– thanks to a low-cost, high turnaround model that thrives on outsourcing work to India. Group FMG’s creative gurus may still sit in New York and London but a large portion of the production work has moved to the firm’s digital production hubs in Bangalore and Chennai.

Group FMG produces video, print, digital and mobile ads and has more than half its employees based in India. The Indian employees pore over artwork, retouch pictures, and create mobile phone applications and interactive design. The firm is rewriting the rules of competition in the global advertising industry by paring down costs. The company’s clients include Staples, Pepsi, Boots, Harrods, Disney, IBM, Yahoo!, Microsoft and Sony.

[caption id=“attachment_348513” align=“alignleft” width=“380” caption=“Group FMG’s advertising campaign for One Stop Touring”]  [/caption]

“We are applying all the clichs of Thomas Friedman’s “The World is Flat” to the advertising world,” Aditya Sharma, co-founder and chief business development officer at Group FMG, told Firstpost.

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“With a multi-location, 24-hour model we are able to offer our clients an opportunity to experiment with ideas and cost structures that were previously not available to them,” said Sharma. “We do not just send low end work to Chennai. The work packets are distributed based on competence and that can exist anywhere.”

According to The New York Times, at Group FMG, a photo shoot might take place in New York or London, but retouching of the pictures would happen in India, and the company would offer its clients a “blended” price for the shoot. “The client’s bill for work done in India is easily 20 to 30 percent less than work done in New York or London,” reported the NYT.

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Last week, Group FMG bought Pod1, an advertising agency in New York that specialises in website designing and development for e-commerce firms in the luxury and fashion space. Its clients include TAG Heuer, Salvatore Ferragamo, Lord & Taylor, Uniqlo and Kenneth Cole.

Pod1 also looks at Pay Per Click (PPC) advertising which has been outsourced to India in a large way by most US companies looking for savings.

[caption id=“attachment_348512” align=“alignleft” width=“380” caption=“Dilip Keshu, Group FMG’s New York-based global chief executive.”]  [/caption]

“With Pod1 now an integral part of Group FMG, we are even closer to establishing our voice as a global leader of the 3C’s - content, commerce, and creative services,” said Dilip Keshu, Group FMG’s New York-based global chief executive.

Group FMG was formed after integrating FMG and Whitefield Analytics. In March 2011, private equity major India Value Fund acquired a controlling stake in FMG for about $20 million. The media solutions group is also backed by former WNS Global CEO and co-founder Neeraj Bhargava’s Zodius Capital.

With the acquisition of Pod1, Group FMG’s global headcount rose to over 300 across its offices in New York, London, Florida, Bangalore and Chennai.

“We have built out a 25,000 square foot center in India which is filling up rapidly and there will be more to come. We have no doubt that we will expand in India,” said Sharma.

There is no reason to doubt Sharma. With ad agencies more and more under the microscope from client companies, seeking to cut costs, the Group FMG model with its India-centric production tilt is tipped to grow in appeal.