Horses of Different Colors

Some agencies are looking a little different than a year ago.

In normal years, PROMO 100 alumni have very simple reasons for opting not to enter again: They had a bad fiscal year, or they were acquired, or they misplaced the entry form three times. (Don’t laugh, that last one’s been tried.)

This was not a normal year.

The Grand Group, Chicago, put a new twist on the standard acquisition reason by buying itself back from Toronto-based Wolf Group. PremiereGroup, Redondo Beach, CA, morphed into Premiere Partners after principal Greg Klein sold his end of the business to partner Brian Shniderson.

The most interesting changes, however, came at the operation formerly known as Chancellor Marketing Group, a marketing services offshoot of radio sales that rode the industry consolidation wave from Chancellor Media to AMFM, Inc. to Clear Channel Communications. Along the way it established a network of more than a dozen regional offices which leveraged their close ties with hundreds of radio stations but sought to provide traditional promotional services to advertisers and non-advertisers alike. Net revenues more than quadrupled between 1997 and 1999, sending the operation up the PROMO 100 charts.

Here’s the twist: Chancellor Marketing Group is now Clear Results. But it’s also PowerPact, LLC.

Here’s the 411: Late last summer, newest owner Clear Channel decided to change the direction in which Chancellor was heading, to focus more on “local and regional programs rather than national campaigns,” says senior vp-market development Cheryl Esken. “We had some healthy markets, but radio stations in some of the smaller markets were having trouble keeping the [Chancellor] offices open.”

Esken confirms that the news didn’t exactly sit well with much of the Chancellor staff. “They understandably wanted to follow the national concept.”

“You lead with a core strength and a relationship.”
— David Renz, Summit Marketing

Among the discontented was ceo Alison Glander, who was originally brought in by AMFM to develop the division. “We had a full promotion agency, and we weren’t about to give that up,” she says. So Glander left, obtained some funding from an investment firm, and by October had launched PowerPact. About 60 Chancellor employees followed, as did some clients including Procter & Gamble, General Mills, and Shell.

Here’s an interesting side note: Glander owned the Midlothian, VA, building in which Chancellor headquarters was housed, so PowerPact moved back into the old digs in January. (It even has the same phone number.) The company has satellite offices in 16 cities.

Since ramping back up, PowerPact has handled a loyalty marketing program for Bellevue, WA-based Spectrum Health Clubs, taken Minneapolis-based General Mills’ Yoplait on a 60-city tour tied to Race for the Cure charity events, and conducted a Mother’s Day campaign for Cincinnati-based P&G at Albertson’s stores.

Clear Results, meanwhile, is headquartered in Chicago and has 10-person staffs in the top five markets, Esken says. Directors of market developments work with local sales reps in other cities. The unit is hoping to utilize the resources of other Clear Channel businesses as well, including outdoor advertiser Eller Media Co. and entertainment producer SFX, Inc.

Although the unit’s mission includes “giving an advertiser the ability to weave the same message throughout compatible media,” according to its one-sheet, Clear Results is happy to work with “non-radio users” as well. About 50 percent of its revenue comes from programs “that don’t have spots attached,” Esken says.

Glander says she “hadn’t realized what a burden it had been with potential customers” that Chancellor was connected to the radio network (and assumed by some to be working first and foremost to boost ad sales). “Before, our mission was to help the radio industry. What’s different now is that we’re truly integrated — although we do always back our campaigns with media.”

The more things change … .

Some Old

Although its name is almost still the same and it is still on the PROMO 100, Contemporary Marketing, Inc. also underwent a signification transformation.

When last visited by PROMO (November 2000), Contemporary had become CMI after parent SFX acquired Heffernan Interactive, Atlanta, a two-year-old field marketing agency launched by former Coke executives Lee Heffernan and Dan West.

Now based in East Rutherford, NJ, CMI grew this spring to incorporate two other sister operations: SFX Corporate Consulting and motorsports marketer SFX/Cotter Group. The result is a $20.5 million agency which ranks 12th on this year’s list.

The merger was “a great opportunity to pull together some of the service-related aspects of the company,” says David Paro, who comes with the consulting group to head up the new CMI as senior vp-general manager. Heffernan, who had been running CMI, becomes managing director for the company’s experiential marketing capabilities, while Tom Cotter does the same on p.r.-fueled activity.

The goal is to provide “lifestyle marketing” assistance to clients, says Paro. “That will often take on an event format, but it could include other types of promotion,” he says, noting the consulting group’s retail activation experience.

CMI’s “core direction” is to create and manage its own client list, although it will be available to help sponsors of SFX entertainment properties execute their campaigns. “We will certainly benefit from the relationship,” says Paro.

Some New

The “change” at Summit Marketing (No. 36), a newcomer to the PROMO 100 this year, was the spring 2000 official launch of a networked group of nine companies acquired by principal Daniel Renz since 1996.

The network includes Atlanta promotion shop Garner & Nevins (Kellogg’s field execution AOR), direct marketing agencies srhd and twofortysevendirect in St. Louis, and a handful of ad specialty businesses. Summit has a presence in eight cities and total net revenue of $36.3 million. Clients include M&M/Mars, Coca-Cola, Applebee’s Restaurants, Cessna Aircraft, Merrill Lynch, Sprint, and the Cleveland Browns.

Summit’s business philosophy is “measurable ROI-types of marketing programs” as opposed to media, says Renz, who spent 10 years as an executive at Anheuser-Busch.

The company has spent the last year making sure the network was fully in place, and only recently began pitching clients with a united front. Still, Renz expects most new business to come through one of its arms. “You lead with a core strength and a relationship. Without that, you’re just swimming upstream.” Once in the door, the trick is to give them “enough confidence in what we can provide that they’re open to us elsewhere.”

The agency’s main focus now is “selling the front end,” which means acquisitions are on the back-burner. “It would have to be significant on a client base or a geographic base, Renz says.