The Top 40: S&R Communications

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You can count the number of marketing entities that bill themselves as a “one-stop shop” on, well, a whole lot of hands. But for Durham, NC-based S&R Communications, the everything-you-need-in-one-place proclamation actually seems less an idle boast than a legit claim.

Over the last few years, S&R has added education (through both its persuasion-oriented MedEd arm and sister company Scienta Healthcare Education, which offers non-branded, accredited CME) and event-planning (the S&R Event Services unit) muscle. The firm has also moved aggressively to develop a range of proprietary tools that foster better-targeted one-to-one communications—think customer-relationship management, rather than the usual shotgun-blast offerings from firms.

To president David Recht, the constant search to fill service voids that many companies don't even know they have is a necessity rather than an as-time-permits option. “Ad agencies are increasingly being viewed as a commodity,” he says. “Purchasing agents are starting
to make the decisions on which company gets chosen. Everybody can do journal ads and strategic planning and mail programs. To distinguish yourself, you have to keep searching for the other thoughtful ways you can provide service and value to clients.”

S&R's 2005 performance would seem to validate this. Staff jumped from 65 to 87, billings to $76 million and gross income to $11.4 million. In the first five months of 2006, business is up 6% against 2005 levels.

On the new-business front, the firm scored agency-of-record assignments from Fleet Laboratories (for bowel-prep products and other work) and from Prestwick Pharmaceuticals (around its neurology and movement-disorder offerings, including a new Huntington's Disease therapy set to debut later this year). S&R also expanded its relationship with Vernalis, adding movement-disorder work to its assignments for the company's Apokyn Parkinson's disease drug.

The Vernalis projects partially offset the loss of business from Mylan Bertek, as Vernalis snapped up some of the company's products and steered some of the work toward S&R. The firm's relationship with Stiefel Labs ended, however, when S&R resigned the account. Hecht says the experience offered a valuable lesson: “Within the life of a service business such as we're in, it's really important for agency and client to be in sync in terms of how they operate. It got to a point where it was really creating some havoc in our shop.”

S&R also tweaked its own positioning during 2005, adding the tagline “an antidote to business as usual.” Recht sounds a familiar refrain—“We don't care where the good idea comes from”—but S&R has made true believers of staffers, setting up a series of reward programs for those who “come up with good business solutions, as opposed to how much they sell.”

The firm also seems to have leveraged its North Carolina base into a competitive advantage, securing preferred-provider status from locally co-headquartered giant GlaxoSmithKline. “Nobody's really thought of North Carolina as a hub of the pharma industry. But with the universities in the area and Glaxo, there's an increasing amount of business here,” Recht says.
Unlike competitors, Recht doesn't give an everything-is-going-to-be-wonderful prediction for the remainder of 2006. “It hasn't been as strong as 2005, in the sense that clients seem to be a little more hesitant about their budgets. But 8 to 10% growth in net revenues certainly seems achievable.”

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