2006 Agency Business Report: CRT/tanaka

Integration of the two firms has been a main focus of the new agency, trying to adopt the best practices of both firms while retaining the same staff.

Integration of the two firms has been a main focus of the new agency, trying to adopt the best practices of both firms while retaining the same staff.

The agency expects to show little financial growth during the first half of 2006 due to the merger, but expects great things from the firm once the dust has settled. CRT/Tanaka took on an account with Atkins, repositioning the brand as a nutritional product after the diet company declared chapter 11.

"Our corporate practice continues to grow more aggressively than the others, but we predict high-single-digit growth for the year," says CEO Mark Raper.

Name of global CEO and US CEO (or most senior equivalent):
Mark Raper, Chairman and CEO

What is your current headcount, and how has it changed from this time last year?
74 employees (Dec. 2005) vs. 69 employees (Dec. 2004)

What was the percentage of staff turnover?
Less than 3%

Did you make any senior hires in 2005 (VP and higher)?
Michael Whitlow, Senior Vice President. Previously, Vice President of Investor Relations and External Affairs for Albemarle Corporation (NYSE: ALB). Michael leads the agency's Corporate Practice.

What senior staff have departed the firm? Please state name and previous title:
Peggy Cummings
, Executive Vice President

Other senior management changes
After CRT/tanaka acquired Patrice Tanaka & Company, (PT& Co.) in October 2005, the management teams of both agencies were combined. PT&Co. senior managers who now serve as senior managers of CRT/tanaka include:
Patrice Tanaka, CRT/tanaka Co-Chair and Chief Creative Officer (formerly PT&Co. CEO, Creative Director and Co-Founder)
Ellen LaNicca Albanese, CRT/tanaka Executive Vice President (formerly PT&Co. President and Co-Founder)
Maria Kalligeros, CRT/tanaka Executive Vice President (formerly PT&Co. President and Co-Founder)
Evelyn Calleja, CRT/tanaka Senior Vice President and Director of Workplace Culture (formerly PT&Co. CFO and Co-Founder)

Have you made any acquisitions in the past year, or merged with another agency?
In October 2005, Carter Ryley Thomas Public Relations & Marketing Counsel (CRT) announced the acquisition of New York consumer PR agency Patrice Tanaka & Company, Inc. (PT&Co.), bringing together the talent and expertise of two of the PR industry's most well-respected, independent mid-sized agencies. The new firm is called CRT/tanaka.The combined company will be headquartered in Richmond, Va. and New York, with offices in Los Angeles, Charlotte, N.C. and Norfolk, Va. CRT's union with PT&Co. creates an agency with approximately $10.4 million in combined fees, making CRT/tanaka one of the largest, independent mid-sized PR firms in the country.

How many offices do you have globally?
North America
Richmond, VA
New York
Los Angeles
Charlotte, NC
Norfolk, VA

Is there a particular region, US and globally, that is growing right now?

How many practice areas do you have?
Over the years, CRT/tanaka has gained tremendous expertise in several industries. Capitalizing on our strengths, we have developed three Core Practice Areas, each headed by senior executives who specialize in the field.

B2B marketing, corporate social responsibility, community relations, employee engagement, investor relations, public affairs, grassroots education, issues management, image and identity development, higher education and public education campaigns.

Cause-related marketing, sponsorship and event marketing, consumer electronics, home and housewares, food and beverage, beauty and fashion, communications technology, marketing to women

Pharmaceuticals, hospitals and health systems, insurers, medical devices, advocacy groups and professional associations

Of those, which ones are part of the core strategy of the agency?
All three

What practice areas showed the most growth?

Which practice areas showed the least growth?

What is the distribution of accounts across practice areas?
Consumer Practice – 50%
Corporate Practice – 25%
Health Practice – 25%

What key account wins did you have in 2005?
Altec Lansing Technologies – After an extensive agency review, CRT/tanaka was selected because of our extensive experience with consumer electronics products and our strong consumer media relations experience.
Chadwick's – The agency was awarded this account by a former client who is now executive vice president of this company and because of our strength in fashion and retail PR and marketing to women.
Cocktails By Jenn – CRT/tanaka was hired by the client because of our smart, strategic approach, experience in marketing to women, fashion, lifestyle and beverage alcohol PR.
Efficient Frontier – The client at Efficient Frontier has been a client at two different companies. CRT/tanaka was selected because of extensive technology experience, business and consumer media relations and world-class client service.
HoMedics – The agency was selected for this account because of our strong experience in the beauty, wellness and retail industries and because the client felt that CRT/tanaka's passion for their business made us the best choice as a PR agency partner.
Kyle Petty Charity Ride – CRT/tanaka was selected because of the agency's relationship with the NASCAR media, via our work with Sprint Nextel. The agency also has extensive cause-related marketing experience.
Owens & Minor – CRT/tanaka was selected because of our extensive healthcare experience and comprehensive branding expertise.
Target House – The agency was selected for this project because of our ongoing relationship with Target Stores and because of our nationally recognized cause-related marketing capabilities.
Tersano – Tersano selected CRT/tanaka because of our deep roots in the retail and housewares industries, our understanding of the product's unique culinary and healthcare application, and our presentation of a program that involved brand marketing PR.
Wines from Rioja (Spain) – CRT/tanaka won this account in a competitive review because of our multi-channel approach to building the Wines from Rioja brand/business that involved PR, advertising, Internet, sales promotions, special events, etc.
Virginia Community College System – CRT/tanaka was selected because of our extensive higher education experience and internal communications expertise.

What key accounts did you lose in 2005?
Apokyn (Bertek Pharmaceuticals) – After a successful and award-winning launch of a new Parkinson's treatment, which resulted in a history-making product demonstration on NBC-TV's Today Show, the company and products were sold.
Concerta (McNeil Pharmecuticals) – CRT/tanaka worked on marketing this prescription drug used for the treatment of ADHA. The funding was eliminated for this project.
Dyson – After a two-year relationship with Dyson, which resulted in the successful launch of the company's product in North America, Dyson decided to take a different direction and wanted new counsel to do so.
Godiva Chocolatier – The agency lost this account after 11 years when a new management team decided to change its PR agency.
Liz Claiborne Inc. – After 14 successful years of working with Liz Claiborne on cause-related marketing campaigns, such as domestic violence and breast cancer, the client decided to go in a different direction.
Mercedes-Benz USA – After completing a number of corporate philanthropy projects, the company chose a new agency of record and decided to consolidate all agency work within that one agency.
PersonalShopper.com – To cut costs, the client elected to consolidate all work under its marketing agency in Boise, Idaho (where the client is located).
Pravachol (Bristol-Myers Squibb) – The patent expires this April on this prescription medication used for the treatment of high cholesterol. This resulted in an end to all marketing during late 2005.

What proportion of your clients are on a retainer?

Has this changed over the past year?
Yes – increased

What was your 2005 US revenue?

What was the % change over 2004 US revenue?

Did you experience top-line or bottom-line growth in the past year?

How did your performance, in terms of revenue and growth, meet expectations you had for the year?
CRT/tanaka met expectations for both revenue growth and profit margin.

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