Accenture’s Creative Push Gets to TCS, Infosys

More than a decade ago, we saw the launch of Accenture Interactive, an attempt to bring in the best of technologies into the creative space. Having set up the business in 2009, today the company is capturing a lion’s share of the $14 billion market that these creative agencies backed by cutting edge technology have drummed up. 

Companies such as TCS and Infosys watched with a degree of dismissiveness as Accenture scooped up several such boutique creative agencies as they were not sure how the business model would evolve. However, by 2015, there was a marked change as Accenture’s new line of business grossed over $2 billion in revenues, growing at 20% each year. 

Early responses came from Wipro who acquired DesignIT studios and a year later, it was the turn of TCS to join the bandwagon with a US-based interactive unit. In fact, the company even got McKinsey’s to carry out a market research which suggested that interactive could grow into a $5 billion revenue stream. By 2018, even Infosys had followed suit.

The road ahead requires lots of planning

The only problem though was that Accenture had gained the early mover advantage, acquiring about 40 creative agencies and rechristening themselves as Accenture Song, which grossed $14 billion in revenues. The catch-up game saw Infosys acquiring four companies with the other two also adding to their strengths in the domain. 

Before we shift to the future, let’s briefly delve into the past. Accenture’s business idea was built around the need to connect with the CMOs – a group whose budgets were growing 25% annually.  But, CMOs were more kosher about speaking to the creative agencies and design firms. So, the company just went ahead and acquired instead of waiting to build and grow. 

Such was its thrust that Accenture Interactive was highlighted as the fastest-growing digital agency network Ad Age. It took them just seven years to move from zero to beyond, a journey that was too fast for Indian IT giants to keep pace, let alone develop strategy and act upon. Then there was the problem of retaining creative talent during such acquisitions. 

It was Infosys that broke the clutter by acquiring WongDoody in 2018 where the creative agency wasn’t embedded into Infosys but retained the brand. The company did the reverse and handed over all its business involving interactive capabilities to the new acquisition. In some ways they worked as a VC funded initiative as WongDoody was soon shopping for more companies.

When Accenture was on Song

Of course, just getting a few brands under one umbrella wasn’t going to be enough. Accenture had ensured that it continuously made headlines in the advertising world. Be it Coinbase’s unique QR code ad or commercials served up during the Superbowl, it was all from the creative juices let out by Accenture Song. Indeed Accenture was on song!  

In addition to retaining the creative minds, Accenture also created robust structures, something that Indian companies are now attempting to do. Infosys brought in Grace Francis, formerly of Accenture Song group, as the chief creative and design officer at WongDoody and then roped in Pete Gosselin from Havas as their creative director of North America. 

We hear that some similar hires could be on the cards for TCS and Wipro as well. However, the one thing that all IT companies are aligned with is marketing operations shifting towards digital. In addition, they also believe that technology and execution would be the core to such efforts in the years to come. Digital experiences is the current buzzword. 

The road ahead may not be all smooth

Though Accenture achieved a head start and other Indian IT companies are chasing hard, the fact remains that there could be several challenges ahead for them in this domain. The first of these is obviously a willingness to change at the client-end. Accenture encourages media buys paid for by clients which only depicts pass-through revenue that hurts margins. The question is will Indian IT giants follow suit as they’re loathe to anything that hurts margins on their books. 

A second challenge could be the leadership itself. While Infosys has brought in new talent and TCS is preferring to go with internal availability, the need to acquire and integrate talent to the larger business cannot be understated. Even Accenture Song got David Droga, founder of Droga5, into its global management team. 

However, what one can say with considerable surety is that this is a business space that none of the IT companies would want to miss. Because, while coding and creative skills can exist in their own universe, only those that can bring them together on metaverse would get the biggest chunk of the advertising pie.