by Matthew Jones

Walk up and down the halls of Carol H. Williams Advertising (CHWA), and the first thing most people notice is the vibrant energy. In an environment consisting mainly of cubicle space, there is a lot of activity, discussion, creativity and motion. There’s an energy that permeates the place, as well as the people that work there.

Patrick Buchanan presides over much of that energy. He is the agency’s senior vice president and managing director. Buchanan has been in the marketing game for more than 20 years, having led some of the industry’s most visible accounts. Earlier in his career, Buchanan created his own national advertising agency, Bang!Zoom.

Today, Buchanan finds himself in one of the top spots at the country’s largest African-American-owned agency. With its main offices located in Detroit, CHWA has more than $200 million in annual billings, and a client roster that includes such industry leaders as General Motors, Procter and Gamble, Kmart, Coors, FedEx and Bank of America. CWHA is clearly a leading force in the multicultural marketing arena.

But the marketing arena is a fluid and uncertain place. There are many forces reshaping the industry, especially in the field of ethnic marketing. While demand for ethnic marketing services has exploded in recent years – due to an increased awareness among corporate clients as to the growing purchasing power of ethnic consumers – the actual number of minority-owned agencies capable of leading clients to and through that marketplace has dwindled.

Many of the independent minority-owned agencies that flourished in the early 1990’s have been acquired by large general market agencies. Faced with growing pressure from corporate clients, many large agencies simply acquired the expertise they needed to penetrate the ethnic marketplace. CHWA is one of the few minority-owned powerhouses to remain independent.

"There will always be a place (for independent minority-owned agencies)," said Buchanan. "Independents bring a lot to the table, particularly with regard to new talent – the people who truly understand the (ethnic) mindset."

Finding – and Building on – New Talent

Although general market agencies are keenly interested in ethnic marketing, Buchanan believes the industry is split in its commitment to diversity. While some agencies are serious about changing their workforce, most are being led by market forces, rather than leading or shaping those forces.

"The clients are largely driving the change," declared Buchanan. "The general market agencies have started either purchasing (minority agencies) or have started their own units, not because it’s the right thing to do, but to make their clients money. Some (general market agencies) are serious – they know it needs to occur. (Others) are led more by client pressure. (Clients) see that these segments make a difference in revenue and growth."

According to Buchanan, failure to develop minority talent is one of the ways most general market agencies fail in their attempts to build a successful ethnic marketing practice. He points to the fact that most general market agencies do not substantially increase diversity within their own organizations.

"There’s a new paradigm, and agencies need to realize that with this new paradigm comes the need to invest in new talent," said Buchanan. "I don’t think that happens very often in general market agencies. They go after someone who’s already out there, not new, vibrant talent – talent that understands (the ethnic market). At CHWA, we nurture new talent."

While general market agencies have been struggling to establish diverse throughout their work environments, the ones that understand it often claim difficulty finding and recruiting the talent they really need. According to Buchanan, the true pot of gold for new talent lies outside of the traditional places, where most agencies tend to limit their efforts.

"We look at the traditional places, too," said Buchanan. "We also tap into some non-traditional areas, as well. For instance, we look at the entertainment industry, the music industry, the fashion industry – anywhere you have individuals with a passion for understanding the new paradigm, along with an understanding of the strategic business approach."

"We’ll also look at creatives right out of design school," continued Buchanan. "We’re very open-minded. We take an almost Bohemian approach (to recruiting). Our talent comes from everywhere. We’re not looking for cookie-cutter solutions. That goes hand-in-hand with taking a multicultural view of the world, and (our candidates) absolutely have to be passionate about that."

Buchanan believes that CHWA success in attracting new and diverse talent reflects the agency’s eagerness to embraces changes in the nation and the world.

"When I was growing up, all the friends I brought home were African-American – that’s just the way it was," said Buchanan. "But today, my son’s friends are like the United Nations – African-American, Hispanic, Asian…and the beautiful thing is, they don’t know any other way."

The thing most people notice if they have the opportunity to walk the halls of CHWA is the talented, passionate marketers of all different ethnic and social backgrounds working together, toward a common goal.

"That’s hard to duplicate," said Buchanan. "It’s like the Wild, Wild West, but controlled. You have a lot of people who are passionate and engaged about what they’re doing. It’s almost like Apple, or Microsoft in its culture that way. That’s a rare thing in this day and age. Our biggest challenge is to keep growing like we have been, and still keep that passion."

The push to embrace ethnic marketing has changed the face of the marketing industry considerably; and minority owned agencies, such as CHWA, see it in the faces of their competitors.

"Over time, our competitors weren’t other smaller, multicultural agencies," said Buchanan. "(Our competitors now are) agencies like Leo Burnett, Foote, Cone & Belding, and Young and Rubicam."

Despite the increased competition from major agencies, CHWA has continued to win its pitches and land new business. Buchanan cites the agency’s refusal to be a one-note-player as a key ingredient of its success.

"There are very few agencies out there that bring all the ethnicities together," he said. "We’re an African-American agency, a Hispanic agency, and more. Under the old paradigm, clients approach ethnic marketing one silo at a time. At CHWA, we approach everyone together first, under one urban umbrella, then drill down into the separate groups. We won the Kmart account because that’s the way we approached the strategy."

Although the "umbrella" approach provides considerable flexibility, Buchanan believes his agency's grounding in the African American perspective is a real competitive advantage.  "Our agency strength lies in African American strategic advertising. We believe that the African American consumer is the driving force in almost every trend. We focus on the African American market, which then appeals to other ethnic markets and the mainstream market," said Buchanan.

As CHWA became more established and successful, it has contributed to significant changes in how agencies approach the creative process. Buchanan cited the fact that the dynamics of sharing accounts with larger, general market agencies has changed. Historically, the general market agencies are the ones with the key client relationships, and most of the money, which left them in a position to dictate strategy to partner agencies involved with the business.

"Now, in some instances, it’s the urban market strategy that drives the general market work," said Buchanan. "Smart marketers like Coors, Coke, Nike – they start with the urban impression and pull the general strategy from there. Now we’re at the strategy table from the start, at the very least. More and more, we’re actually driving the strategy."

Despite the uncertain economy, and a general slow recovery in advertising spending, 2003 was an outstanding year for CHWA – perhaps the best in the agency’s 17-year history. Billings remained above $200 million. Kmart and Procter and Gamble were added to the company roster. The agency also developed successful programs for Coors, Bank of America and GM, including a campaign to provide a boost for the GMC Yukon – one of GM’s largest SUVs.

Although pleased with CHWA’s performance in 2003, Buchanan is focused on new growth opportunities. "Technology is clearly a growth area for us," said Buchanan. "The numbers of African-Americans and Hispanics with PCs, Internet access, broadband are among the industry’s fastest growth areas. Penetration in these markets is at an all time high."

Most multicultural agencies are also focused on healthcare as a primary area of growth. As African-American, Hispanic and Asian baby boomers age, there is growing demand from clients to reach these groups. Many companies are beginning to focus in on the specific healthcare threats faced by each ethnic group. African-Americans who, as a whole, seem to be at higher risk of almost every known health threat, are a prime target market.

"There needs to be greater communication on how to avoid (illnesses of which African-Americans are at greater risk of developing), such as hypertension and heart disease," said Buchanan. "Pharmaceutical companies, in particular, will need help reaching out to these populations."

Buchanan also named the financial industry as another potential growth sector for CHWA. Given the growing financial power of ethnic communities, Buchanan believes leading financial services firms and advisors will spend the money needed to market their services to these communities.

In an industry where quality and success often speak for themselves, current clients are another significant component of CHWA’s overall growth strategy. Much of the agency’s growth in recent years is directly attributed to expanded services among existing clients.

"If you look at our top clients, they’ve all increased their budgets," said Buchanan. "We’ve also been approached by executives who are colleagues of our existing clients. We’re getting lots of referrals (from other departments within our clients’ organizations)."

But the agency is careful not to bite off more than it can chew, and it strives to keep quality and consistency as primary goals. "We’ve had to decline pitching new business on occasion," continued Buchanan. "Clients were gearing up for 2004, and we needed to give them our undivided attention. (Our existing clients) take priority over everything."

The End