New-age firms' in-house creative talent paid 30 percent more than ad agency talent

The recent rise in the trend of establishing in-house creative teams has led to more talent jumping from ad agencies to client brands, adding to the ad industry's on-going talent bleed.

By  Mansi JaswalJun 25, 2024 9:53 AM
New-age firms' in-house creative talent paid 30 percent more than ad agency talent
An employee in a new-age firm earns 30% more than its counterpart working in an ad agency

22-year-old Abhinav Kumar (name changed) is a graphic designer in a new-age firm with an LPA of Rs 7 lakh. Before this, Kumar said he worked with a cluster of ad agencies and added, "I love my current job because it pays me well". In the past decade, a drove of start-ups in the country have witnessed several changes, which includes the establishment of an in-house creative team. Companies have begun recognising the value of their in-house creative talent to drive marketing efforts, aligning with a broader shift towards greater control, agility, cost efficiency, and brand authenticity, Sekhar Garisa, CEO of foundit said.

According to Teamlease data shared exclusively with Storyboard18, the median salary of an employee at the "junior level" in the creative departments in a new-age company is Rs 3.75 lakh, and it tends to increase with experience to Rs 7.25 lakh, and at the managerial level, the median salary is Rs 15.35 lakh.

New age firms' impact on ad agencies

The recruitment of in-house creative departments by new age firms has hit advertising agencies to a great extent in the past decade.

Sumbul Khan, Business Lead for the Indian Market, Virtue Worldwide said that a different kind of talent was found in the in-house team of a new age firm/start-up around 10 years ago but the upstream communication was addressed by ad agencies only.

However, the shift began when the D2C brands witnessed a significant influx of funds. "They (new age firms) were able to make a proposition that was financially more gratifying for the top talent from the agencies too," Khan said. Also, the additional sweetener became the "Young or 18 till I die" talent of the ad agencies, a similar demographic found at the new age companies as well, Khan added.

Shantanu Rooj, Founder and CEO of TeamLease Edtech, a learning and employability solutions firm, said, "There has been a notable four percent increase in the establishment of in-house creative units, marking a rise from 78 percent to 82 percent between 2018 and 2023".

Rooj said that the growing trust in an in-house creative could be attributed to factors such as "amplified control over brand messaging, strategy, and execution". He added that cost-efficiency is the predominant factor behind the lack of reliance on agencies. Other contributing factors include swifter and more agile processes, enhanced integration, and a deepened understanding of the brand.

"There's a growing emphasis on brand authenticity and storytelling in marketing, where in-house creative teams excel in understanding and conveying a brand's unique essence, resulting in more genuine messaging. Furthermore, building an in-house team proves to be cost-effective compared to outsourcing to advertising agencies, as it eliminates agency fees and markups. In-house teams also boast agility and responsiveness in adapting to market trends and consumer preferences, facilitated by direct access to decision-makers and seamless communication channels," Garisa said.

According to Nisha Singhania, CEO & Managing Partner of Infectious, some new-age firms have fully in-house teams, while others adopt a hybrid model where they maintain a small in-house team and collaborate with external agencies for specific projects or campaigns.

Remuneration in ad agencies

In an ad agency, the median salary of a copywriter is in the range of Rs 3.2 lakh-Rs 3.5 lakh; a senior manager's median remuneration is around Rs 4.2 lakh per annum; a graphic designer may earn between Rs 4.5 lakh and Rs 4.7 lakh, and a Creative Director’s remuneration would be around Rs 14 lakh-14.7 lakh as per TeamLease data.

Oftentimes an employee in a new-age firm earns 30 percent more than his/her counterpart working in an ad agency. For instance, if a copywriter earns between Rs 4-5 lakh LPA in an ad agency, his counterpart may earn about Rs 8 lakh in a new-age firm. Similarly, if an ad agency designer has a pay package of around Rs 6 lakh-7 lakh, the same individual could get Rs 10 lakh LPA in a new-age firm, multiple industry professionals told Storyboard18.

As per Rooj, research findings indicate that the working conditions associated with these positions are characterised by underpayment, devaluation, and exploitation in the ad industry.

However, Saksham Jadon, Founder and CEO of Youngun said that the advertising industry rewards both creativity and collaboration. "In recruitment processes, originality and willingness to learn are valued more than experience. A growing trend involves agencies offering unpaid trial assignments, with subsequent paid opportunities for promising candidates. This approach allows agencies to assess talent firsthand and invest in individuals who demonstrate potential," Jadon added.

Ad agencies vs new age firms

Harshil Dhawan, Creative Head, Zomato, who previously worked with renowned ad agencies for over a decade, elucidated the pros and cons of the two.

Dhawan said, "Ad agencies provide a dynamic work environment where you get to work on diverse brands, which fosters creativity and agility. However, working for a start-up or a new-age company like Zomato offers the in-house creative team a significant level of control over the brand's vision and strategy. This close alignment with the company’s goals also enhances stakeholder management and enables more cohesive and integrated campaigns."

Speaking on remuneration, Dhawan emphasised that new-age firms tend to offer more competitive pay packages to candidates with significant and relevant experience, particularly when the company is performing well and expanding.

First Published on Jun 24, 2024 7:39 AM

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