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September 2006 - Strategy Magazine
Biz

Agencies woo new clients by sprouting niche services
Many shops drill deeper within their own client roster to grow their biz

by Lisa D'Innocenzo
page 13

It's like dating. When a potential pool of prospects dries up, you might widen your search by joining a special interest club. On the other hand, you may decide to revisit the tried-and-true and give love another go with a past flame.

When it comes to advertising, the agency approach to courting new business isn't much different. As the battle for marketing dollars intensifies, many shops are chasing new opportunities through niche divisions specially created to serve emerging marketing trends. And some are doing so with the realization that they can squeeze a lot more work out of their current client relationships.

According to David Gibb, managing director of JWT Toronto, the quest for new work is an increasingly difficult one "from a couple of different angles. One, potential new clients are incredibly demanding in terms of hoops they know they can get people to jump through in order to get their business. Two, everyone's competing pretty aggressively for the business that's out there. Bottom line, I would say that it's tougher than it's ever been."

One way in which JWT hopes to steam past its competitors is via Ethos, its new "social strategy practice," as the division's VP Pamela Divinsky describes it. While Divinsky won't share Ethos' financial targets, she says her main objective is to become an integral part of JWT by filling a void in the market for this type of service at a time when corporate social responsibility is on consumers' radar. "Most of our clients come to us and say: "We suspect we're not getting the kind of social profile we could be getting and we know it's not having a direct impact on the way we grow our business.'"

So far, Ethos, which is the recent evolution of JWT Social Marketing, a specialist entity created four years ago, has 10 corporate clients, including Shell, HSBC, TD Bank Financial Group, Sick Kids and the MS Society. It employs six core staff, as well as a virtual network. In terms of recent wins under the unit's new name and focus, at press time several new project contracts were in the process of being finalized. While reluctant to name names, Divinsky reported that a financial services firm, global consumer product manufacturer, and a retailer were all close to coming on board.

Similarly, Toronto-based ad agency Allard Johnson Communications and two partners - PR firm Veritas Communications and event planning specialist Integrated Health Care - joined forces to form Ingredients Nutrition Insights Group in March, a new shop that offers 360-degree expertise to food marketers increasingly challenged by nutrition trends and regulatory issues. All three companies already specialized in nutrition marketing and are members of Toronto-based holding company MDC Group.

Says Terry Johnson, president of Allard Johnson: "Consumers are more demanding about nutrition and the products they are consuming and the government is getting more involved in what can be put in those products. We believe there's a significant future for this type of company, and not just in the short term. I think it's going to get greater and greater as people become more concerned."

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