It has taken Gary Reynolds 20 years to get exactly where he used to be.
The promotion industry has spent those two decades evolving to a point Reynolds’ agency has been honing all this time. That puts GMR at the top of its game as clients like Microsoft Corp., Intel Corp., Mercedes-Benz, and Visa USA catch on to event marketing.
It’s what Miller Brewing has known since 1983, the year GMR debuted by handling the beer maker’s Band Network bar promotions.
“We’re a rare bird,” says ceo Reynolds. “While pioneering 20 years of event marketing, we’ve seen it come from the lowest of low to [have] equal footing with advertising.”
The use of event and mobile marketing has skyrocketed: Nearly one quarter of marketers say events are among their most important strategies; some already earmark more than 25 percent of their communications budget, according to PROMO’S Annual Report on the U.S. Promotion Industry.
That popularity is reflected in GMR’s growth: Net revenues nearly doubled in two years to $49 million in 2001, on billings that also doubled to $132.6 million. Three-quarters of 2001 revenue growth came from clients new since 1999 including the aforementioned Visa, Mercedes, and Intel. (Reynolds projects “a lot of core client growth” in 2002.) Staff has tripled in three years to 346 in seven offices and 545 in the field — plus a roster of 420 temps.
“A client recently implied that we came out of nowhere — like we’ve been in hiding,” says president Jay Lenstrom. “It’s like a band that plays 200 nights a year for 10 years, and then ‘suddenly’ explodes on the scene.”
Reynolds and crew had an epiphany in 1997 — the year Omnicom bought GMR, which had grown into a full-service agency with promotion and p.r. expertise. “Omnicom preached integration long before anyone else,” says Reynolds. “So we looked at how to integrate with its promotion and ad agencies without competing against them.” GMR settled on five “pillars” of expertise: sports, music, mobile, multicultural, and lifestyle marketing. “We struggled with it for a very short time,” says Lenstrom.
The shop is retooling again to add more strategic planning; in January, it hired former Miller vp-marketing Jack Rooney.
The agency is now part of Radiate, a holding company for event marketing formed last year by Omnicom’s Diversified Agency Services division. Radiate bought four businesses last year and has eight pending acquisitions to round out event services worldwide — from trade show and hospitality to ride-and-drive and golf events. Reynolds sits on Radiate’s board.
Expert Detailing
Meticulous execution built GMR’s reputation. Then strategic smarts earned the shop a role in planning as marketers embraced pricier, sophisticated events.
“It’s not just awareness stunts anymore,” says Lenstrom. “RFPs come from a higher level than they did five years ago, and have sales, advertising, and branding components. We meet with chairmen to discuss strategy.”
New Berlin, WI-based GMR courts high-tech brands eager to reach 18- to 25-year-olds, a crowd the shop knows well. Tech brands stretch its street skills: The April launch of Intel’s Pentium 4 Mobile processor sent 70 “human computers” (reps with laptops braced against their chests) roaming New York City to show off the chip’s mobility; that was followed by a Barenaked Ladies concert in Bryant Park, the first “wireless park” where mobile computers get free online access.
Intel hired GMR last year to leverage its sponsorship of the Area:One Music Festival. The agency created a Digital Music Zone with kiosks that let concert-goers demo videogames, cameras, and music via Intel Pentium 4. The tour hit 17 markets in a single month.
Alltel’s 50-market Freedom tour this year showcases phone, Internet, and DSL products — all running live on a 53-foot rig. Consumers can sample those services, recharge their cell phones, and play games.
Alltel hired GMR last September to clean up its sponsorship roster, then commissioned the rig in December to tour sponsored events (per the agency’s suggestion). “Our sponsorships were out of hand,” says Lucy Pathmann, Little Rock, AR-based Alltel’s sports and event marketing manager. “We wanted to be in a few things and own them. GMR helped set that strategy.”
Last fall’s launch of Xbox set GMR to work with Microsoft Corp.’s promotion, sales, and p.r. divisions to produce introductory events and a long-term tour. Xbox Unleashed was a 48-hour gaming marathon in Los Angeles and New York City with live music by big-name bands, free eats from Taco Bell and SoBe, and 20,000 attendees. Xbox Odyssey dispatched two traveling game parks, each housing 200 video stations and a VIP lounge under a gigantic inflatable dome. Both won PMA Reggie awards in March.
GMR worked four years on Xbox’s launch. Now, it’s pitching game software through the Xbox Cup, a drag-racing series launched last month, and Xbox Title Wave, which gives radio stations in eight markets tricked-out Cadillac Escalades with Xbox systems; stations drive them around to events, then award them as contest prizes. Radio tie-ins in 20 markets and an xbox.com overlay support. (Cornerstone Promotions, New York City, assists.)
“They staff well against my team, do what I expect, and then do more,” says Cindy Spodek-Dickey, group manager of national promotions at Microsoft, Redmond, WA. “They’re creative without being outrageous. [Account director] Rick Arnstein is our gladiator and gadfly: He pushes us to consider ideas we never would.”
That creativity raises the bar for execution. “We weren’t in the business for all we suggested to Microsoft,” Arnstein admits. The Xbox plans pushed GMR to learn co-marketing (for negotiations with Taco Bell and SoBe) and trade shows (to build the Xbox booth for electronics show E3). “Our biggest challenge is elevating operations and account service to the level that blue-chip clients expect,” Arnstein says.
New projects start with a meeting of up to 30 GMR department heads — anyone who might get involved. Creative director for ideation Terry Spilde recruits brainstormers based on passions: Avid gamers work on Xbox, music fans assist Intel (January PROMO). Then, chief operating officer Bryan Buske makes the ideas work.
Success is making Buske do a double take, says Rooney. “That’s happened for 20 years,” counters Buske, who joined GMR straight out of college. “We’ve always been known for flawless execution. That has just grown as the company grew.”
Execution is GMR’s top selling point: Arnstein brings a framed photo of Buske on sales calls and tell prospective clients, “This is the guy who’ll get it done.” “We never see [execution] as a difficult venture,” says Reynolds. “It’s the genesis of the idea that we struggle for. The system is in place to get it done.” Buske still worries about the same things he did 20 years ago: the weather, the traffic, the time sheets. “The event world is reactionary,” he says. “That’s what makes it fun.”
GMR polices its own work, sending mystery shoppers to check field staff performance. Intel got a scorecard to rate its own and GMR staffers during the Pentium 4 Mobile launch. The client found fault with some Intel folks, but none with GMR. “We shut them out,” Arnstein boasts.
Sponsorship clients like GMR’s objectivity (the shop doesn’t represent any properties) and research capabilities: The agency has built Alltel, Visa, Mercedes, and now Miller a yardstick that measures what a potential sponsorship will pay back.
“If we develop a unique concept, we’re on par with other agencies,” says Lenstrom. “But if we can say how feasible it is and how much it will cost, then we have a huge point of difference.”
Clients praise GMR’s sense of strategy. “Being on-strategy is an art, especially in promotion, which can easily diffuse into other stuff,” says David Finch, vp of Johnsonville Sausage, Sheboygan Falls, WI. “GMR creates ideas with unique value and puts them into action.”
GMR helps Visa and its shops (BBDO, Frankel, Ketchum) set a theme for each sponsorship. “They provide strategic counsel and background information,” says Michael Lynch, Visa’s vp-event and sponsorship marketing.
Microsoft sets course with GMR twice per year, then checks weekly that execution is on-strategy. The client has three GMR staffers stationed in Redmond headquarters.
Directional Accuracy
The strategic work rises on the agency’s cornerstone: field marketing. For Philip Morris, GMR runs the two-year-old Virginia Slims Day Spa program (which expands to 10 markets this year) and the Basic Antiques & Appraisal festival (think Antiques Roadshow) hitting 15 markets. PM creates programs in-house, then relies on GMR to tend to the brands in-market.
GMR’s delicate handling of the Pepsi Challenge relaunch in 2000 was “a Herculean effort to satisfy me, [bottlers], senior management, and other constituencies,” says Craig Coffey, then Pepsi’s director of brand marketing (now vp-general manager of the Pepsi/Lipton Tea partnership).
Pepsi’s secretive RFP asked for two minutes of generic Pepsi chat; GMR talked about Pepsi’s youthful appeal and music and sports links instead of bashing Coke, says Coffey. “Their ideas were about enhancing the Pepsi experience. It was better to start on that playing field than in the gutter.”
GMR has run Johnsonville’s Big Taste Grill trucks for seven years. “They’re the gold standard for event promotion,” says Finch. (The drawback is sharing GMR’s time with Pepsi, Microsoft, and the like: “We used to be a bigger client,” Finch laughs.)
The shop was conducting Manhattan store checks for Intel on Sept. 11 when planes hit the World Trade Center. Intel wanted to help rescue efforts, so GMR rigged 100 wireless laptops onto a trailer and had it at Ground Zero by Sept. 13.
For a month after the attacks, “everyone came off the road. But stuff didn’t sit idle very long,” says Buske. Xbox Unleashed broke Nov. 1 and Odyssey Nov. 15. Miller postponed MGD Blind Date’s Bermuda Triangle trip (the winners will travel this year). Budget decisions were pushed to January, but no clients cut spending, says Reynolds.
Some people balk at GMR’s suburban Milwaukee base — Arnstein jokes about traveling “behind the Cheddar Curtain.” The shop is building up offices in Chicago, Dallas, Los Angeles, San Francisco, Seattle, and Charlotte to replicate its eight-year-old New York City office (where Arnstein resides).
The agency recruits by word of mouth from the 1,000 field staffers — many of whom rise through the ranks to management. “Our field staff is a wonderful farm league. We evaluate it constantly to pick the cream of the crop [for advancement],” says Reynolds. “They have good discipline for moving people through the system,” chips in Johnsonville’s Finch.
Staffers say GMR is fun and fast-paced, has great people — and cold beer. Arnstein adds: “Gary created an awesome culture of people you’d think would never get along.”
GMR gets along with its sisters, too: Last year, it did 100 projects with Omnicom siblings — and another 50 to 75 with non-Omincom agencies. “We’re Switzerland,” says Lenstrom.
What’s next? More of the same: GMR is helping Miller revamp its Rellim Music Tour (May PROMO) for 2003. The hot-band showcase is a 21st century version of the Miller Band Network, which lent the marketing support “that big companies can do in their sleep” to emerging bands, says Reynolds. “That was Miller’s credibility,” he says, lamenting that the brand ever dropped the program. (Some distributors still fund regional band tie-ins.)
“Companies throw out a really good idea because the marketing or brand people are tired of it. But consumers don’t get tired of it,” says Reynolds. “Over 20 years, we’ve seen the focus shift to media-driven programs from on-premise, and now it’s shifting back again.
“It’s a wonderful struggle to keep this whole thing growing, to keep it vibrant, creative, and fun — and desired by companies,” says Reynolds. “It sounds tame, but we’re happy for what we have and want to keep doing it.”
For now at least, the industry seems to be in agreement.
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