United Colors Of Global Hue - Page 3 of 4

United Colors Of Global Hue

$40 million account. Chrysler was looking for one advertising agency that could reach a host of American subcultures rather than a number of agencies — each targeting a specific market segment. Coleman’s selling point was that his agency would soon be positioned to fully handle multicultural marketing — just what the auto manufacturer was looking for.

The four-month process frazzled nerves at the agency, especially when the review was extended and the number of agencies vying for the business narrowed. “What little hair I have left turned grayer,” says Montemayor, with a chuckle. “Even though with the melding of the two agencies, we could have survived a Chrysler loss…I was very nervous.”

While the review dragged on, Coleman looked to further enhance his agency’s multicultural image with Chrysler and other clients. He began talks to acquire Innovasia, one of the nation’s premier Asian American advertising agencies, with clients that included General Motors, Union Bank, UPS, and Korean Air. “Don Coleman had approached us and started talking to me about his long-term vision, where he saw marketing going, and how he envisioned the marketing paradigm shifting from the general market toward the ethnic markets,” recalls Elcid Choi, Innovasia’s former chief, who now serves as a GlobalHue vice chairman and president of Asian American operations.

When all was said and d
one, Don Coleman’s agency not only retained the account, but Chrysler increased ad spending from $40 million to some $140 million. “The review was basically centered around the direction we were moving in anyway — a multiplicity of services under one roof,” says Coleman, who completed the acquisition of Innovasia upon retention of the Chrysler account.

Now consolidated, GlobalHue faces challenges aplenty. Among them is how to gain market share in an environment in which larger general market agencies are increasingly delving into the multicultural market. “The pressure doesn’t stop,” says Montemayor. “As the [marketing] budgets grow, so does the pressure from that particular sector.”

In order to compete amidst that pressure, GlobalHue’s team plays to its strengths. “We’re specialists,” points out Choi. “A general market agency is good at reaching the masses — a population that’s very homogenized. They all look at the same type of media, but the diversity markets, by definition, are specialized. And if you want to reach a specialized market, you have to bring specialists in.”

Another issue is the minority stake that publicly traded Interpublic Group of Companies Inc. holds in GlobalHue. In October 1999, Coleman sold a 49% stake in DCA to Chicago-based True North Communications as part of a deal that created New America Strategies Group — a multicultural group of agencies that consisted of DCA, SiboneyUSA, a Hispanic agency, and Imada Wong Communications Group, which focuses on Asian American consumers. By 2001, Interpublic had acquired True North in a stock swap valued at some $2.1 billion. (Coleman would not disclose the substance of his talks with Interpublic.)

One of Coleman’s more recent collaborations is with hip-hop impresario Russell Simmons, CEO of Rush Communications (No. 14 on the BE INDUSTRIAL/SERVICE 100 list with $260