Rebound boosts marketing efforts

As the economy improves and client demand increases, local advertising and marketing agencies are happy about the work but cautious about the future.

At the Gronstedt Group in Broomfield, President Anders Gronstedt says clients began to reinvest in their marketing programs within the last six months. ?During the past several years, we have seen companies become less focused on revenue growth and more focused on cost cutting,? he says.

As companies return to emphasizing revenue growth, the Gronstedt Group has experienced increased demands from existing clients, such as Avaya and TD Waterhouse. It also has gained two new clients, Prentice Hall and Norgren. The firm currently has 12 clients.

The Gronstedt Group specializes in delivering customized training programs in sales, brand communication, customer service and other soft skills, geared to help frontline employees better represent their company. The firm has 15 employees locally and an affiliate office in Stockholm, Sweden.

Gronstedt says he expects to keep this number static, at least for a while, and use freelancers for design, programming and writing instead of hiring additional staff.

?We?re being a bit cautious and waiting to see if the economy holds,? he explains.

In Lafayette, Stratecom Chief Executive Officer Bill Obermeier says since January the firm has seen a growing number of client requests for marketing. After several years of having clients? reduce their marketing expenditures, he says, Stratecom is now helping companies look at how to reinvigorate their brand.

Additionally, he says, clients increasingly are having Stratecom help with research to understand their customers better. For example, one client, an educational institution, is evaluating the process by which young people decide where to receive an education, while another client, a manufacturer of medical products, seeks to better understand how purchase decisions are made at hospitals.

?Clients are interested in finding out where the market is after the downturn,? Obermeier says. He would not disclose client names.

So far in 2005, Stratecom has added five new clients to its roster. To handle the additional workload, Obermeier says the company may hire three to five employees this year to the firm?s current staff of 15.

For Dan and Jean Ditslear, co-owners of Red Wall Communications in Longmont, it was the recent downturn that prompted the husband-and-wife team to launch its advertising and design firm. The Ditslears started Red Wall in 2002 after they both lost their full-time jobs at other agencies. To date, Red Wall has 15 active clients, including five new clients since the beginning of 2005.
Like Stratecom?s Obermeier, Ditslear says rebranding is a popular demand from current clients.
A nonprofit client, for example, is undergoing a sizable rebranding campaign, complete with advertisements, a revamped Web site and a new logo. For the nonprofit, Red Wall is redoing its brochures, newsletter and annual report to reflect the company?s new look.

But even as business booms, Ditslear says he and his wife intend to keep the firm to just two employees, at least for now. ?We?re trying to keep our overhead as low as possible,? he explains. If necessary, he adds, they will hire freelancers to handle overflow work.

While some firms have experienced a surge in client demands for marketing and advertising, others are reporting more tepid activity.

Michael Rice, managing partner at the Sterling-Rice Group in Boulder, says clients are optimistic about a stronger economy. At the same time, the increased competition, changing demographics and the weak dollar can all affect a client?s bottom line and ultimately their marketing budget, he says.

Clients that are increasing their marketing initiatives include those in consumer packaged goods, especially organic foods, Rice says. Meanwhile other clients, such as those in the airline industry, have been unable to be as aggressive as they would like with their marketing and advertising campaigns because high gas prices are affecting revenues.

Currently Sterling-Rice has 20 clients, including three clients that the firm acquired this year.
Despite mixed demands from clients, the company has added 10 employees in various departments, ranging from creative services to account services to research. Rice says that as the firm absorbs more clients, they will hire staff accordingly.

At Leopard, which just moved to Broomfield from Boulder, Chief Executive Officer Sherri Leopard says that while Leopard saw an uptick in business during late 2004 and the first quarter of 2005, the firm now is starting to see a slowdown. She attributes reduced activity, in part, to disappointing earnings results in the technology sector ? an industry where Leopard has many clients, including all nine divisions of IBM.

?We went into the year thinking we could add as many as 20 people, and we have added half of that,? she says. The firm is taking a ?wait-and-see? attitude with client growth before hiring additional staff. Leopard currently has 85 employees.

For those companies that are working to put their marketing programs back on track, local marketing and advertising firms agree that the Web has become an essential tool.
?The Internet is part of almost every client?s program. They are either building an e-marketing program or experimenting with one,? Rice says. E-marketing programs include a variety of Web-based strategies such as key-word searches with search engines, banner ads, e-newsletters and blogs.

For client Bernina, a sewing-machine company, Sterling-Rice helped pull together webcasts on quilting topics for its site. Sterling-Rice also helped the company develop other relevant content, such as online sewing classes. By providing such information, Rice says, customers are able to better understand what Bernina has to offer.

Stacey Schuham, co-founder of Brandplay in Boulder, agrees that the Web has become a significant factor with marketing plans, especially those for technology companies. Schuham estimates that about 60 percent of Brandplay?s clients are in the technology industry.

Brandplay specializes in helping companies identify brand strategies that affect how customers interact with a company. In today?s world, she says, the ?primary way to interact with customers is through the Web,? which makes the use of branding especially important via the Internet.
Beyond company Web sites, Schuham says blogging is another hot topic within marketing circles, as it is an objective way to quickly gauge market reaction on how a company?s brand is resonating with audiences.

on Facebook on LinkedIn