In our April issue, Sir Martin Sorrell, founder and executive chairperson, S4 Capital, spoke to us about the Indian market and the goals set for Ketan Desai, whether cricket is overpriced, acquisitions, and more...

Talking about India's growth potential, Sorrell said, “Rural India continues to show strong growth, but urban areas are definitely facing some pressure. The changes in technology are broadly positive for the country, although their full impact will take time to materialise.”

He added that he remained 'extremely bullish about India’s prospects', especially considering the wider backdrop of global uncertainty.

According to Sorrell, when faced with such unpredictability, businesses tend to double down on markets they have confidence in, and India is firmly in that category.

Sorrell further explained that in regions like North and South America, the Middle East, and parts of Asia, investment would continue despite geopolitical tensions. In contrast, Europe, he noted, “is in a difficult situation”, and technology would be necessary to boost efficiency there.

Discussing India specifically, he said, “India benefits from two dynamics – its inherent growth momentum and the global diversification away from China.”

He believes this combination places India in a uniquely advantageous position in the global market.

When asked about S4’s progress in India following the appointment of Ketan Desai as managing director, Monks, Sorrell, he said, “Ketan is a great addition to the team. He brings a fresh perspective that is needed. The operations have started well this year, and while it’s not easy, he is really beginning to get his arms around the business.”

While pointing out that technological adoption in marketing services was accelerating, he had a concern about how Indian clients were not keeping pace. 

“Certain legacy clients are not moving as quickly as they should be. The pressure on them to adapt and improve will only intensify,” he said.

Elaborating further, he clarified that while the Indian government and the tech sector have made impressive strides, traditional sectors still lag behind. He said, “There is significant admiration for what’s happening globally in tech-driven marketing. But in India, we need to adapt faster to these global trends.”

Touching on the sensitive topic of government surveillance linked to new income tax regulations, he said, “Generally, any step towards greater monitoring makes me uneasy. But if it’s aimed at improving security and tackling terrorism, there could be a justification for it.”

When questioned about goals for S4’s India team, he stated, “The honest answer is profitable growth.”

He stressed the need for a hybrid model that combines traditional marketing skills with technological prowess. “We have an edge in technology, but it’s about demonstrating to traditional advertisers how to adapt to and adopt new methods,” he said.

Discussing client dynamics, Sorrell remarked, “At the moment, local clients probably account for two-thirds of our business in India, which is slightly more than ideal. Ideally, we would like a 50:50 balance between local and global clients.” He highlighted that Indian companies were already significant or poised for major growth, unlike in some other markets.

On acquisitions, Sorrell downplayed the idea of aggressive inorganic growth: “Organic growth is the strongest way to do it. And there are bags of opportunity to be captured without necessarily buying businesses.”

When discussing the challenges faced by creative agencies, he observed, “The world is dividing into two industries – traditional creative and digital. Digital is now a USD 700 billion industry growing at 10%, while traditional is shrinking unless you have live sports content to bolster it.”

Regarding cricket pricing, Sorrell offered a note of caution: “There will come a time when cricket becomes uneconomic if pricing isn't carefully managed. Live sport remains critical, but overpricing could shift attention towards alternative sports in India.”

To read the entire conversation with Sorrell, click here to buy the April issue.