Kelli Coleman, executive vice president of GlobalHue (No. 1 on the BE Advertising Agencies list with $83 million in revenues), agrees that the African American segment continues to be challenged but notes “a slight uptick in budgets†for the Latino market. Her firm’s greatest success story, however, has been its multicultural, multiplatform campaign for the Jeep brand in which it serves as global agency of record. The result: Jeep’s year-over-year sales increase of 44%, the biggest spike in the industry. “Our deep understanding of multiculturalism and how it influences the total market is the reason behind this marketing success,†says Coleman.
Los Angeles-based Walton Isaacson (No. 2 on the BE Advertising Agencies list with $50 million in revenues) realized the most significant revenue growth among be agencies last year, rising to become the nation’s second largest black-owned agency. The firm has been able to capitalize on its status as agency of record for Lexus Multicultural Marketing, which includes African Americans, Hispanics, and LGBT. Successful campaigns include general market creative for Lexus CT200h. “I’m really optimistic about what I see happening. Our budgets have increased. Across the board it seems like clients are feeling more comfortable about the economy and spending,†maintains Co-founder and Partner Aaron Walton. “We’ve seen tremendous growth, not just in the multicultural work that we do, but also across all the business segments that we support.â€
Financial Services: Ready for the Rebound
Among BE’s financial services companies–banks, asset managers, investment banks, and private equity firms–uncertainty still reigns. With extreme volatility in the stock, bond, and housing markets, as well as skittishness brought about by the looming European debt meltdown, these firms, collectively and individually, must seek to find new strategies for revenue growth and customer base expansion.
Black banks have been reeling since the Great Recession. Many still need new sources of capital after heavy loan losses, contending with stringent capital requirements and the cost of regulatory compliance. In fact, five black banks have been forced to shutter operations in the past year. And Carver Federal Savings Bank (No. 1 on the BE Banks list with $671 million in assets) had to be rescued from a shutdown or takeover last year when Wall Street powerhouses Goldman Sachs Inc., Morgan Stanley, Citigroup Inc., and others injected $55 million into the institution.
Veteran banker Paul C. Hudson doesn’t see much progress for the black community until next year. The chairman of Los Angeles-based Broadway Federal Bank (No. 5 on the BE Banks list with $417.4 million in assets) described 2011 as “one of the hardest years ever†in its 66-year history, citing several large loan write-offs and the closing of two of its five branches. Though Broadway is meeting capital requirements under a cease-and-desist order by regulators, it is looking to raise $10 million to $20 million.
William Michael Cunningham, social investment adviser at Creative Investment Research Inc., maintains that black institutions need to become more aggressive about making loans in their communities. “There are a lot of opportunities for those banks that recognize that they’re in a unique position to get additional deposits by appealing to customers who are fed up with the large banks,†Cunningham says.
(Continued on next page)