Who You Calling a Promotions Agency?

Putting together the annual promo 100 issue is at once an exhilarating and an enervating experience.

It’s exhilarating because it provides the best opportunity for the magazine’s editorial staff to speak intimately, candidly, with hundreds of promotion professionals. We undertake a lot of background checks and deep discussions with both agencies and brand managers before we ever begin the official process of compiling the issue. That affords an opportunity to discern a lot of inside information – the type you don’t always learn about when conducting formal interviews. We put the issue to bed and walk away feeling fulfilled about the insights we have gained – and that’s exhilarating.

But the process is also enervating, and not simply because of the time-consuming and often tedious effort involved in examining entry forms and crunching data. (Ever tried getting 100-plus executives to verify their net revenues? I’d rather have my fingernails torn out.) It’s arduous also because – in addition to some of the great brains you get to pick – you speak with a lot of people whose viewpoints you just don’t get.

YOU’RE A WHAT?

One of the most confounding viewpoints we ran across this year was the strange notion that agencies which have expanded their range of services beyond the discipline of promotion should now deny the industry from which they came.

I spoke with about a half-dozen principals at agencies previously part of the promo 100 who declined to enter this year because they are “no longer promotions agencies.” Asked what they had become, their responses included “integrated marketing agency,” “marketing strategy consultant,” “holistic marketing agency,” and (this is my favorite) a “whatever-it-takes agency.”

Interesting thoughts. But our only response to any promotion agency that says it doesn’t just do promotions anymore is: Duh.

Take a look through the promo 100, and see the variety of services agencies are offering these days:

– Brand identity development; brand communications; brand management; brand positioning

– Market research; technology research

– Sponsorship consultation

– Licensing

– Public relations

– Web site design; e-commerce; desktop publishing

– Focus groups

– Advertising; media planning/buying; broadcast production

If straight sales promotion is still all you do, you better be unbelievably good at it, because the competition is offering that and a whole lot more. And if you’re only now deciding that you’re more than a promotion shop, you’ve probably fallen behind the pack already.

Of course, those explanations may be no more than an attempt to smokescreen a bad financial performance. (We’ve heard that’s definitely the case in at least one instance.)

We’re also still wondering about that one erstwhile promo 100 member, now “much more than a promotion agency,” that still touts itself as “one of America’s top 100 promotion agencies” on its Web site. In the interest of decorum, we won’t mention theshop by name (but it sounds like something you use to cool drinks).

THE BEST POLICY

To be commended are the agencies who entered this year despite a decline in revenues, which generally leads to a drop in promo 100 ranking and can often lead to potential clients asking, “So, tell me, why’d you drop in the rankings?”

That’s probably not the easiest question to answer. But if you’ve got a good story to tell, as they say, you can explain that a blip in the financial books doesn’t always imply bad work.

The industry is filled with tales of agencies who lost major accounts in spite of stellar work. For instance, St. Louis-based Momentum – an agency we profile in this issue – earned a bronze Reggie Award for its work with Motorola last year, but will not repeat the performance this year due to what one source at Motorola termed a “political” decision to go with another agency.

Smart brand managers know not to judge agencies on the list solely by their rank. Melville, NY-based Don Jagoda Associates didn’t have a great year in ’99, and its ranking suffered for it. But you’re still not going to find an agency that knows more about sweepstakes promotions. Likewise, The Regan Group, Los Angeles, did a little business transitioning last year, so net revenues declined. But, the entertainment marketing specialist’s billings were up more than 20 percent.

For those agencies that chose to go into hiding, we wonder what their answer might be when a client asks, “So, how come you’re not in the promo 100 this year?”

We think that might be an even tougher question to answer.