Up Periscope: A good year for the ad agency

  • Article by: DAVID PHELPS , Star Tribune
  • Updated: December 25, 2011 - 3:30 PM

The independent Minneapolis-based ad agency is booming, adding workers, clients and office space.

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People might be familiar with Periscope's distinctive building on Washington Ave. in Minneapolis, even if they aren't acquainted with the business inside

Photo: Jeff Wheeler, Star Tribune

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Folks at Minneapolis ad agency Periscope will remember the year 2011 as a bustling one.

The workforce grew by nearly one-third to 330. Billings topped $300 million. The client roster grew to include the likes of Columbia apparel, Exxon Mobil and animal and pet food giant Nutrena.

Employees received a $1,000 performance bonus in the middle of the year on top of a $500 technology credit in October to buy iPads, iPhones and laptops.

And just this fall, the Periscope real estate footprint along Washington Avenue grew by 18,000 square feet when the 17-year-old agency bought the building across the street to give it some breathing room for the bursting-at-the-seams staff in the existing quarters.

And all of this happened in a sluggish economy. "I can't imagine us being happy with the status quo," said CEO Greg Kurowski. "As times become more desperate, our clients need us more."

Yet the Periscope executive team can be sanguine about its success.

The company's mantra is "It's good to be good, but it's better to be good and lucky," said Chairman Bill Simpson.

Periscope's work includes four years as the figurative and literal voice of the Minnesota Twins, including print, radio and television. It counts Arctic Cat on its client list as well as the Red Robin restaurant chain. Periscope recently became the agency of record for Great Clips.

Three years ago, Andersen Windows approached Periscope about producing a small-budget video for the Bayport-based company. "We hit it out of the park, and today Andersen is a top-10 account for us," Kurowski said.

But such rapid growth is not without its consequences. Periscope has lost some business, too.

Earlier this year, longtime client Par Aide, one of the foremost manufacturers of golf course accessories including ball washers and spike cleaners, left Periscope for a smaller agency.

"They were fantastic and did nothing but great work for us," said Dan Brown, manager of sales and marketing for the Lino Lakes-based company. "But it was time for us to get some new blood and thoughts about our brand. We're a fairly small company compared to the brands they represent, and we needed a little more attention than they could give us. They understood."

Good for the industry

The advertising industry expects 2012 to be similar to 2011. A report earlier this month in the trade publication Adweek said industry analysts expect spending to be flat to slightly up next year. But industry observers believe Periscope's apparent success bodes well for the region's advertising industry.

"I think the tide is starting to turn," said Jennifer Johnson, an advertising professor at the University of Minnesota School of Journalism and Mass Communication. "We have healthy agencies in the Twin Cities that are strong. They have good business people. They have good creative people. When you see growth like that at Periscope, you feel so much better about your possibilities."

Periscope is the second-largest ad agency in Minneapolis behind Olson in terms of employees, according to the annual Twin Cities Business Journal's annual ranking. Rounding out the top five are Fallon, Martin/Williams and Carmichael Lynch.

Periscope counts health care, telecommunications and retail as the core of its business.

It has expanded rapidly into social networking in recent years as Facebook, Twitter and other social media became fixtures in brand marketing. This year the agency stepped firmly into the world of loyalty marketing and customer engagement with several key outside hires at the vice president level to guide the enhanced effort.

"We're not talking about a stamp collection" when it comes to loyalty marketing, Kurowski said. "We want to capitalize on our social media team and our analytical team and couple them together."

Independently owned

Kurowski said the key is to get customers to engage with a brand. For example, he said, Red Robin customers can go online and build their own hamburger as a "Chief Burger Officer."

"We want to provide an incentive to get people into the store," Kurowski said.

Periscope bills itself as the largest independently owned ad agency in the Twin Cities with no holding company or venture capital company looking over its shoulders.

"If you're owned by someone else, then they control your decisions," said Kurowski. "We wouldn't be able to hire the bodies we hired or buy the building next door or expand our technology. If you don't have to dig yourself out of a hole, then you can grow."

As an independent agency, Periscope also has more leeway in working with clients and investing in their brand, Kurowski said. Some clients haven't been revenue-positive for the agency for as long as 18 months as brand strategies were developed.

"We can just sit around the table and make all of our decisions," said Simpson. "We can partner with our clients."

While Periscope added several significant new clients this year, it also experienced organic growth from existing clients.

"They're asking for more and different services, from loyalty marketing to packaging," said executive creative director Mark Haumersen.

UnitedHealthcare's senior-focused business has worked with Periscope for five years on ways to engage and communicate with its 50-year-old and older clients.

"We look at digital, TV, the printed product. They even helped publish a book for us," said Terry Clark, chief marketing officer for the business segment. "They have a passion and focus on making us successful."

Within the last seven years, Periscope has also opened offices in Hong Kong and Delhi to serve some of the needs of clients whose products are made in the Far East, thus eliminating the expense of shipping items to Minneapolis for pre-press, production and photography services.

David Phelps • 612-673-7269

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