The veteran of poll-based strategic consulting on why Indian firms aren’t as globally known as they should be, the Hillary campaign and his management style.
He’s helped Bill Clinton and Tony Blair run successful re-election campaigns. He’s worked with 25 leaders and “done” 500 elections around the world. He was the chief strategist for Hillary Clinton’s presidential bid. He heads Burson-Marsteller, one of the world’s largest PR firms. But it is as CEO of Penn Schoen Berland (PSB), a market-research centred strategy consultancy he co-founded and is now a WPP subsidiary, that he meets for this lunch.
If you read the East Coast press, Penn appears a contentious figure. His admirers describe him as hard-headed, his detractors as arrogant. Certainly, unlike the power people I’d met the previous week – Bill Gates, with whom he has worked closely, and WPP’s Martin Sorrell, his global boss – Penn expends little effort on charm or small talk and appears immune to provocation, writes Kanika Datta. He is accompanied by a young man whose card reads Chief of Staff and both have tilaks on their foreheads and red threads around their wrists, evidence of a havan to consecrate PSB’s official inauguration in India.
The venue is L’Angoor, a faux French and Hindi pun on grapes and monkeys (the logo shows both in case the double entendre escapes you). Penn mulls Indian food but settles for a spicy Jamaican dish, jerk chicken, when he’s told he’ll have Indian cuisine that night. I choose scallops in pasta.
The India business was being kicked off with the PSB 50, a ranking of the most globally recognised and respected Indian multinationals and their CEOs. The results were to be announced at a “power breakfast” the next day so I ask about the big message from the survey, which, an email says, was conducted with “financially influential and investing audiences in financial capitals around the world...”.
Penn speaks so softly that I am nervous the dictaphone won’t pick up his voice. He senses this and pulls the machine closer. The big point, he says, is that Indian companies aren’t as well known as their market influence and size suggest. For instance, on the reason for the success of Indian companies, the survey showed the answer was that India has the benefit of low material and labour costs. “So what they do not do is attribute Indian ingenuity for the success.” Unlike, say, Microsoft or GE, he adds, India doesn’t have brands that are globally known. “Tata is the closest thing to that but even that is not a household name.”
This is unsurprising, I argue, since Indian companies are only just globalising. He is unconvinced. “Look, a lot of companies in America developed their brands market by market, country by country; they heavily advertised, researched and marketed.” Look at Korean brands, he adds, they had very poor reputations for years. Indian companies, he contends, are “used to a lower cost structure, so their first instinct is to sell at a lower price and enter a market on different terms.”
He finds this situation surprising because India is a brand-crazy country. So why don’t Indian companies want to be “brand makers instead of just brand takers — especially now that they’re getting the economic power to begin the process?”
Small wonder, then, that he sees opportunity in emerging Indian multinationals — but no less in Bollywood and political polling, PSB’s original business. Who has he approached, I promptly ask. He laughs uneasily and jokes, “Luckily I can say I have just arrived…” then launches into his pet theme about crafting campaigns based on data.
The burden of his argument is that five to 10 per cent of a campaign budget must be devoted to planning so that you identify and focus on the swing groups. I point out that in Indian polls, bar Kerala, West Bengal and Delhi, the swing factors are huge, so maybe the challenge is different. He contends that India is not unique. “In Latin America, I worked with the opposition and the opposition nearly always won because” – grinning – “conditions were so bad. So the difficult campaign was holding on.”
Voters, he warms to the theme, “start out almost tribal in nature. As communications through TV and the Internet evolve, they become more influenced by what they see and hear; and the more independent they become as voters the more important the methodologies that we deploy. We understand what kinds of policies interact with the messaging…”
So why, I interrupt, did these methods not work for Hillary Clinton? “Well, it’s not that it didn’t work,” he says defensively. “You can’t win every campaign. We won re-election with Bill Clinton and two senate races. Obama crossed the finish line with 200,000 or 300,000 more voters in one of the most bitterly fought primaries — in many ways, it was unprecedented for the elections to go down to the wire and there’s always ‘should have, could have, would have’ but these were two great campaigns.”
Much later in our conversation, he does say his campaign might have worked if Clinton had taken on Obama early. “He was a rising phenomenon and had to be deflated early. I recommend the same thing to corporate clients.”
Among the criticisms against his campaign, I persist, was that it was way too data-driven. He disagrees. “If you read Microtrends” – his 2007 book – “it’s about having creativity that’s checked by data. The truth is the Obama campaign was slightly more data driven than we were — they had twice the polling budget we had and they micro-targetted voters.” In fact, he adds, “they even had people formerly trained by me! There were a lot of dynamics in that race and having more or less data certainly wasn’t one of them.”
So what was his prognosis on Obama’s re-election? He refers to an article he’d written for Huffington Post that morning. In the last 90 years, it said, there have been only two Democratic re-elections – Franklin Roosevelt and Clinton in 1996 – so historically, the odds are stacked against Obama. “But Obama is a highly adaptive politician despite his problems today. Frankly, Clinton’s re-election had even more problems. So at the end of day, can he win? He certainly can.”
Then he delivers a doosra. “It’s interesting that Obama announced his candidacy. Back in 1996, if we had an announcement about Clinton’s candidacy, it was tiny paragraph somewhere because the guiding principle was that it was better to be a president than a political candidate. But Obama enjoys being a political candidate.”
Penn is truly a veteran of polling; his first was at age 13. A later attempt as editor of the school newspaper nearly got him expelled; it was a poll on whether students had sex or smoked marijuana. “It was a private school,” he chuckles, “so they didn’t really want people to know what their students were up to.”
It was a summer job pollstering for Ed Koch, who successfully ran for Mayor of New York City despite starting out with two to three per cent of the vote, that encouraged Penn to jettison a lawyer’s career. He recalls with wistful pride that it was the late seventies, the era before the PC, and he’d programmed a computer to deliver instant results.
Indeed, technology and gadgetry provoke almost boyish enthusiasm. “I try everything: I have my Windows phone, iPhone, Samsung Galaxy tablet, I’m doing lots of work with Sony TV so I keep buying them.” He launches into his prediction on the next Big Thing, a long way from his father’s kosher poultry business. His father was of Lithuanian origin, a “smart guy who never went to college” and was originally a union organiser. His mother is of Hungarian extraction.
Penn was appointed CEO of Burson-Marsteller around the time I briefly worked for the Indian firm that was acquired by it. Much of the corridor talk, I tell him, was about his abrasive style and how many talented people exited globally. “I’m just a fraction of what I used to be as a 25-year-old. I was a terror then,” he says cheerfully. “Today in the corporate world I am much more judicious.”
He liked “things done right”, and points to Burson’s performance under him as justification (“like night and day”). “When I took over the firm was shrinking, profits were stagnant.” Now, he says, his company has the strongest record within WPP of all PR firms. “We have a management team that’s second to none, top talent, have almost tripled the bottom-line. So on all metrics – including getting along with everybody – we’ve done well.” Tellingly he adds that with the Hillary Clinton campaign, he wasn’t allowed to build a team.
The meal, heavy but swiftly dispatched, is over and we’ve chosen tea over dessert. “You obviously haven’t read Microtrends,” he tells me, and his Chief of Staff hands him a copy. The title page is pre-signed with a signature that is little more than a capital L. He explains he’d devised it when he worked for his brother’s export business and was required to sign many documents in a day. I joke that it is easy to forge. He doesn’t look in the least amused.
