IT looks to up interactive share in revenue mix

The interactive business requires more design as well as user interaction and experience building to hook end customers to a digital product or make a digital experience more enjoyable.

Agencies
TCS is looking at winning awards, such as Cannes, to help it make a mark in the interactive space.
BENGALURU: Technology services companies such as Tata Consultancy Services (TCS), Cognizant and Wipro are taking different paths to succeed in the interactive business focused on advertising and marketing, an area in which they have had little previous experience.

The interactive business requires more design as well as user interaction and experience building to hook end customers to a digital product or make a digital experience more enjoyable. In the absence of such skills in-house, IT companies have made a slew of acquisitions.

Wipro acquired Designit in 2015 to start its design and user experience business, and then bought Cooper in 2017.


Wipro said the share of overall digital business including interactive to its revenue was nearly 40% and doing well. The company has now started concentrating on design thinking and user experience-led service offerings for both existing and new customers.

Wipro sells design and experience-led digital services to existing customers and is also acquiring a lot of new customers, CEO Abidali Neemuchwala told ET.

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Even TCS, known for being cautious with acquisitions, bought London-based W12 Studios last November to expand its services in the area.

TCS is looking at winning awards, such as Cannes, to help it make a mark in the interactive space. “We are growing in interactive. If you see we are getting nominated in Cannes, the goal is to bring the Lion home.” CEO Rajesh Gopinathan told ET.

Last year, Infosys bought digital marketing agency WongDoody, its first acquisition after Salil Parekh took over as the CEO.

Competition is tough. In the interactive space, these IT firms compete not just with each other, but with advertising agencies that have built their interactive arms, and Accenture, which has a lead among technology firms in this area. In September, Accenture said revenue from its interactive business had crossed $10 billion a year.

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Meanwhile, IT companies are also beginning to determine whether interactive is an area in which they could truly win. “We have identified four digital battlegrounds in which we have to win — cloud, digital engineering, data and IoT — and I truly believe IoT will be unlocked by the power of 5G,” said Brian Humphries, CEO at Cognizant. “I am not saying that we will not invest in interactive. We have a team there and we are investing,” he added.

Greyhound Research CEO Sanchit Vir Gogia said IT services companies were broadly focusing on building technology capabilities, role-based capability through acquisitions and vertical-based capabilities. For example, he said, Accenture bought an advertising firm and that would help the company speak to the chief marketing officer of any organisation in a more effective way.

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