Bill Imada of L.A.’s Imada Wong Communications Group Inc. used to see little competition for the smaller, Asian consumer-oriented accounts that are the specialty of his marketing and communications firm. But lately, he has seen some much bigger companies battling him for clients.

“We just pitched a piece of business and there were eight companies,” Imada said. “Six of them were large agencies. We’re talking multinational agencies, that we don’t normally compete with.”

The economic downturn has changed the way local advertising agencies and public relations firms do business. Some are taking on clients this year that wouldn’t have gotten a second look during the flush times of the dot-com boom. Plummeting stock prices and financial uncertainties that have arisen in the wake of the Sept. 11 attacks on the Pentagon and the World Trade Center might make this even more of a buyer’s market.

“There are companies that wouldn’t even look at a $1 million account a year ago and now, they’re scrambling to take accounts that are $500,000 annually, $250,000 annually, or even accounts that have really heavy pro-bono requirements,” Imada said. “Now I’m finding these same companies competing with little guys like me.”

Firms are also becoming more creative in their efforts to attract new clients by hosting free symposiums or promotional events.

Shorter-term assignments

“We are looking at shorter-term pieces of business that we might not have looked at last year when we were literally almost working above capacity,” said Ron Hartwig, executive vice president and general manager of Hill & Knowlton’s L.A. office. “There are a number of companies that might come to us that will say, ‘You know, we really have a project assignment here’…This year, we might say, ‘Hey, that sounds exciting.'”

While some agencies are as picky as ever, they have been working harder to keep clients happy. “In some cases, we’ve been asked to get involved with some of our direct advertising and interactive,” said Bill Hagelstein, executive vice president of Rubin Postaer and Associates in Santa Monica, whose clients include Acura, Arco and Honda Motor Co.

“Sometimes the attitude is, ‘(The account) is not as big as we would like but let’s go for it,'” he said. “It’s been a trend for a while but there’s no evidence that it’s going to discontinue.”

With start-ups no longer crowding the market, Bender/Helper Impact Inc., a West L.A. PR firm, is taking some project work and accepting lower fees in the hope of creating long-term relationships, said co-founder Dean Bender.

“Last year, you were pretty much able to throw a dart at a fee dartboard because these companies understood the need to generate awareness of themselves. Now, it’s scaled back dramatically,” he said.

Lower client fees

Once taking clients that paid fees in excess of $20,000 a month, the firm is accepting ones that generate about $10,000 a month, Bender said. He expected this year’s revenues to fall somewhere between $5 million and the more than $7 million Bender/Helper took in last year.

Less affected by the economic slump are agencies that focus on growing ethnic markets, especially the mushrooming Latino community.

“Our business is growing,” said Hector Orci, co-chairman of La Agencia de Orci & Asociados, which focuses on the Latino market and counts Allstate Insurance and Verizon Communications among its clients. He expects 15- to 20-percent growth over last year. “The Latino economy has been behaving very differently from the general market economy,” said Orci.

Many in the industry were uncertain about the effect the terrorist attacks would have on their business.

Saatchi & Saatchi in Los Angeles recently had to pull an ad created for Toyota Motor Corp. because it featured an explosion. But the agency had not seen any clients cut back their budgets as of last week, said Chief Executive Scott Gilbert. “People are going to make an effort to keep the economy buoyant,” he said.