I am smiling as I write this.
If you’ve ever tried to build a platform, you’ll know how frustrating it can be.
Self-doubt lurks behind every door. Only ridiculous optimism can send that particular monster scurrying back into the darkness.
I am grateful that we are still around to tell this particular story of the past 18 months.
afaqs! Marketplace was launched in mid-2020, around the first national lockdown. As you can see, the beginning wasn’t auspicious :)
The purpose of setting up Marketplace was to help businesses find the right agency. Why bother?
Twenty five years ago, advertising was a cosy club. Marketers and agency executives knew one another. They had often graduated from the same institutes. There were not that many companies that could afford to advertise on TV or in print. The number of agencies was small, too.
Today, every other local store is a potential advertiser. Every other bedroom is the launch pad for a new agency.
With a smorgasbord of both buyers and sellers of advertising services, a platform like afaqs! Marketplace would be useful, we reckoned.
Marketplace is a microcosm of the marketing communications market in India.
We have small, first-time advertisers as well as several nationally known brands that have tried it out.
But of late, the most exciting segment on Marketplace consists of regional brands, with a turnover of Rs 100 crore plus. They are battle-hardened and are looking for new creative partners who can take them to the next level. We are excited to play a small role in helping them get there.
One of the earliest examples of such a company on Marketplace was the Nashik-based Empire Spices and Foods, owner of the Ram Bandhu brand of snacks and spices. It is a rapidly growing business which had a turnover of Rs 240 crore last year.
What is the value of projects that have been posted on afaqs! Marketplace in the past 18+ months?
Until now, 233 projects have been posted from across the length and breadth of India. In each case, up to 10 suitable agencies (or design studios or film production companies) are introduced individually to the advertiser.
At an average project value (only agency fees, not media expenditure) of Rs 9 lakh per project, the cumulative agency fees on offer so far add up to about Rs 21 crore.
The pace of action is accelerating.
A year ago, we received fewer than 10 projects a month and the potential value of each was lower too, about Rs 5 lakh. So, the monthly value in possible agency fees last February was about Rs 50 lakh.
This month, February 2022, Marketplace is poised to post 30 plus projects valued at about Rs 3 crore.
Several companies have returned to use the platform a second time in their quest for a creative partner. In fact, a robotics company from Bengaluru has posted three requirements in three months! Such repeat users will certainly increase.
What is the nature of projects being posted on afaqs! Marketplace and where are they coming from? Here you go:
By city: With 27 per cent of the projects posted, Delhi NCR is in the lead followed by Mumbai (21 per cent) and Bengaluru (13 per cent). Ahmedabad, Kolkata and Chennai are the other active cities.
Project or Retainer?: On launch we assumed that most marketers would share one-off assignments. How wrong we were. In four out of five cases – or 80 per cent – marketers are seeking agencies on a monthly retainer for, say, digital marketing. One-off projects make up the remaining 20 per cent.
The skew towards retainership seems to have been hastened by Covid and the acceleration of digital communication.
Project Value: We are talking agency fees here, not media spends. Again, we had assumed that the typical project would be a one-time affair with a fee of about Rs 3-4 lakh.
In the early months the assignments were indeed worth around Rs 5 lakh as brands experimented with the platform. But over the past 12 months, the projects have grown bigger. The typical project is a retainership with a monthly fee of Rs 75,000 or Rs 9 lakh in a year. (And, of course, there are smaller as well as some truly large assignments.)
Agency Location: With digital spends on the rise, do businesses care about where the agency is located? Much less so than before. In about 70 per cent of the projects shared on Marketplace, the marketer was happy to work with an agency ‘anywhere in India’. The one region where there was a somewhat higher preference for local agencies was south India, for reasons of language.
We had originally theorised that advertisers within Mumbai and Delhi, the two mega advertising centres, would seek local partners. In other places, we believed, advertisers would be open to agencies from elsewhere because it would give them greater choice.
Covid has proved us wrong. Generally speaking, businesses are open to working with agencies irrespective of location.
Nature of Advertisers: The pattern here is still emerging and will change with time as the posting of projects accelerates.
On the evidence until now, projects are most likely to be from foods, education, ready-to-wear, fashion accessories, cosmetics, ecommerce, retail chains and real estate (where one of India’s largest conglomerates is currently shortlisting agencies).
We expect a surge in assignments from retail and travel businesses as the world opens up.
Type of Assignments: There is a strong skew towards online assignments on afaqs! Marketplace. And within online, social media marketing is the king of the hill: more marketers seek this service than any other. Direct marketing and performance based marketing tie for the second spot.
After that, we have a bunch of services for which there is similar demand One, help with branding/brand strategy. Two, films for social media. Three, website/app design. Four, public relations and lastly, influencer marketing.
Some large advertisers have also come in and put in a requirement for full-service creative agencies which can handle their entire communication play.
And on to the future: where will afaqs! Marketplace be one year from now?
In terms of projects, we should be posting 75-100 new projects per month. The range of assignments will be broader. Brands are still getting used to the platform. Hopefully, they will begin using it a bit more regularly. The conversion rate should rise, too.
Several of our guesses have proved wrong :) but I do believe I know the direction in which afaqs! Marketplace is headed – up!
The author of this article Sreekant Khandekar is the co-founder of afaqs! and the founder of afaqs! Marketplace.