MUMBAI: In a major development, Leo Burnett India has bagged the integrated "full service" advertising account of India's only Fortune 500-listed company and the 17th largest petroleum enterprise in the world, Indian Oil Corporation (IOC).

The size of the account is currently estimated to be in the region of Rs 400 million to Rs 600 million. However, the spends are slated to ramp up significantly in the next financial year due to the impending entry of the Reliance and Essar group into the oil retailing and marketing business in a liberalised environment.

With this move, IOC has also shifted away from the public sector undertaking (PSU) norm of having several agencies on the empanelment list. In fact, agencies such as FCB Ulka, Interface, TBWA Anthem, RK Swamy, Mudra, Span and Mercantile, amongst others used to handle the various advertising requirements of the company. The huge chunk of the spend is channelised into tenders, notice ads, direct marketing activities, in addition to the display part of the business.

In a deal that was reportedly finalised yesterday, IOC decided that Leo Burnett will handle the creative and client servicing functions whereas Starcom will handle the centralised media planning and buying.

While speaking to indiantelevision.com, Starcom MD (West and South) Ravi Kiran says: "We are absolutely ecstatic about winning the account of India's largest commercial enterprise, that has achieved commendable performance in all areas of its operations in addition to posting new highs in its financial performance. It is a pat on our backs."

When questioned whether the agency will have to set up a separate unit to handle the diverse requirements of the client, Ravi Kiran said that the existing infrastructure and resources would be deployed with the requisite changes: "We shall have a near dedicated team to service the account. In fact, we shall be shopping for resources and will take on new talent."

Indian Oil’s sales turnover for the year 2002-03 reached a new high at Rs 1,198.48 billion in the first fiscal after the total dismantling of the Administered Pricing Mechanism in the oil industry. The company has embarked upon the path of undertaking prudent finance and projects management; competitive business strategies to increase market share; customer-focussed innovations in product and service offerings; streamlining of business processes and systems for economies of scale; and greater synergy with group companies in order to face the challenges of a deregulated market.

The corporation is also simultaneously pushing ahead with other growth initiatives by way of integration and diversification into related areas.