Don’t see any major slowdown hampering the industry: Yannick Bolloré

Vivendi's chairperson explains why the Havas Group could see a slower Q3 compared to previous quarters this year, why consumers won't listen to Jeff Bezos and buy refrigerators, Twitter's acquisition, and more...

Nov 23, 2022 08:26:00 AM | Article | Raahil Chopra

Yannick Bolloré, chairperson, Vivendi, and CEO and chairperson, Havas Group, was in Mumbai on 21 and 22 November to meet with the team as well as clients. Campaign India caught up with him to learn more about his visit in which he revealed he was meeting the head of an agency he plans to acquire in the country, and a lot more...
 
Edited excerpts:
 
What's on the India agenda? You last visited three years ago when the team was very different...
 
It’s my first visit to Mumbai and I’m glad I’m here. Previously, I’ve always visited New Delhi.
 
The agency has developed a lot from when I last came to India. We’ve grown from a 250-member team to now one that’s over 1,200. 
 
So far, I've met with the team members, and I'm glad I did because they bring a lot of energy. We had an event on Monday (21 November) which was visited by loads of clients. On Tuesday (22 November), I had an interesting breakfast with Pradeep Bakshi, the CEO of Voltas. After this chat, I'll be meeting with an agency over lunch, which we’re trying to acquire.  
 
How close are you to completing this deal? Can you reveal details about this agency?
 
We can’t disclose that yet. 
 
Our strategy in India is to double our presence. Five years ago, the strategy was to triple the team and we ended up growing by five times in terms of employees. I think it’ll be great to be a 2,500-member team in the next two-three years.
 
India as a country is growing and we want to grow with it. We need to scout the market and look for people that would love to be part of the Havas family.
 
Last week you announced the acquisition of an Australian-based healthcare agency. Could you reveal which space this agency operates in?
 
In India, we want to be best-in-class in every discipline of communication, whether it’s creative, media, experiential, design, commerce, data, or production. First, we need to reinforce what we have and then if we can find the talent we need to improve our expertise, we will. 
 
We are keeping an eye on the market and as long as it fits into our strategy and culture, we will look to make acquisitions. One key differentiator of Havas is the fact that we operate under the same roof (Havas Villages) and want people to integrate.
 
Amongst the verticals Havas Group India operates, where are you seeing maximum growth from?
 
When I look at the numbers, every discipline is growing. Having said that, we’ve seen Covid impacting each differently. 
 
For instance, just before Covid hit, we acquired Shobiz, an event and experience company. It was hampered by Covid at first, but the team has been very smart and has adapted to digital events. I met with Sameer Tobaccowala, the CEO of Shobiz, and got to know that this is going to be a record year. The agency has adapted and continued to grow during the pandemic. There were no layoffs during the Covid lockdowns too even though the business of events was affected.  
 
Honestly, I’ve got so much trust in the future of Indian operations that we are ready to invest in anything related to our business.
 
Q2 and Q1 have been strong for the group with around 11.5% growth. What's the estimate for Q3 and the rest of the year?
 
Q3 has been a little bit slower on the group level but that’s because of the base effect. When you compare the third quarter of 2021 to the third quarter of 2020, it was very good because of what happened in 2020.
 
So far, in the first nine months, we are growing over our projections. We haven’t finished our year yet, but every signal shows that it’ll be a record year in terms of revenue. 
 
The speed of the recovery of not only Havas, but our peers is really impressive. 
 
Now, we are starting our budgeting process for 2023, and so far things are looking good. This is surprising, especially because of Europe’s current situation. I don’t see any major slowdown. It’s weird because when you look at the geopolitical situation, it’s very volatile. Inflation is hampering consumers too and it’s huge across France and the rest of Europe and the USA. Some categories might be more impacted but others are projecting growth.    
 
That’s interesting. Recently Jeff Bezos warned consumers and businesses to postpone purchases like refrigerators and televisions…
 
People are playing safe for sure. But if one needs a refrigerator, then one will buy it. It’s about the type of product. 
 
Things can change rapidly, but so far it seems to be robust. 
 
We're seeing other groups asking clients to pause advertising on Twitter after the takeover and the uncertainty. Would you have similar advice for your clients too? What do you make of the Twitter takeover?
 
What’s important for us, is to make sure we can guarantee a safe environment for our client, whether it’s television, social media or print. 
 
Regarding the Twitter controversy, I’ve been receiving a lot of emails from Twitter account managers, explaining how they’re still putting things in place and is a safe environment for brands, but when you read the press reports it’s a different situation. 
 
The tension was in the US because two weeks ago they had the midterm elections which was a tense time.
 
We’ve had discussions with our clients regarding Twitter instead of issuing a written statement. We are waiting and watching right now. Some of our clients have decided to pause advertising on the medium. Things are moving day by day and we are monitoring the situation very closely. 
 
The company is experiencing a big change. I’ve got many friends who are working at Twitter. Some of them have ‘resigned’. I got a message from Twitter’s CEO in France yesterday saying he has resigned. I’ll call him when I get back to know more about this. 
 
When it comes to Twitter, it’s less than 1% of the digital media spends for clients. Google and Meta make up two-thirds of the spends. In terms of proportion, even if a client decides to pause spends, it won’t affect revenues immensely. 
 
But Meta and other digital media are also seeming to have uncertainty around them. Meta laid-off a huge chunk of its staff as well
 
We’ve had controversies in the past too. There were talks about Facebook when the shooting incident happened in New Zealand. No one is talking about it anymore. Meta is still growing, albeit at a slower pace. 
 
YouTube had a controversy with the beheading video many years ago. 
 
So, these kinds of controversies happen, but things pass. 
 
In two years, we will all know that something happened at Twitter, but it will all be a thing of the past. 
 
We’re seeing new platforms like TikTok growing and attracting ad spends. We are also seeing the likes of Netflix adding ad platforms which are contributing to the growth. 
 
Having said that, I’m not placing any bets on this because of how the situation has been changing every day.
 
The Vivendi group in India has Havas, Gameloft and DailyMotion. Any plans to launch other group companies in India? Canal Plus Series could have a market given the OTT growth in India…
 
We have plans for international expansion for Canal Plus. I don’t know whether we will be specifically in India in the short term, but there are plans to launch in other Asian markets.
 
When it comes to entering India for Canal, we aren’t looking at pure acquisitions. We can enter India through partnerships too. We have a large subscriber base and if we can expand it through smart partnerships across the world, the team will be very interested. 
 
In India, Havas is Vivendi’s biggest offering and we have plans to expand this further. The team here is very talented and knows that they have all the support of the group in terms of investments.
 
In an interview with one of our global Campaign editions, you mentioned that you had three concerns for 2022 - inflation, the war, and logistics and shipping issues. Now that we're almost at the end of the year, are these still challenges? How has the group tackled them? 
 
The war continues. Inflation is a concern because of the impact it will have on consumption. We are seeing prices across categories increase. The cost of paper is affecting our three publications. 
 
Shipping and logistics don’t remain challenges. The price of logistics and shipping has gone down over the past five weeks and so it’s easy for companies to transport goods. 
 
Three bold predictions for 2023?
 
It’s a tough question because the world is very uncertain and because 2023 is less than two months away now. I'd rather predict something for 2050! 
 
We will have some differences between different industries. It won’t be growing and declining at the same pace. Inflation will impact the capabilities of people to consume traditional goods. The purchasing power will be tough for people.
 
Labour’s compensation and salaries aren’t increasing as per the inflation. This could lead to some social unrest in Europe and the USA. India is growing and should be fine and isn’t facing this tension. 
 
Having said this, I still project growth for the industry. Everything related to digital will grow at a good pace.  
 
The most exciting aspect of the Indian market?
 
There are many exciting aspects. The number one for me is the opportunity for growth the market provides. You feel that India is a land of opportunities. It’s like being how China was 20 years ago, and I say this as a compliment. The growth potential is great.
 
With the FIFA World Cup going on and you coming from France. What are your predictions for the tournament? Will France retain the cup?
 
My prediction for the World Cup is that the best team will win it!