Las Vegas Sun

March 28, 2024

DRGM wins high-profile state tourism ad account

A Las Vegas company has wrested away a multimillion-dollar state tourism advertising contract from the state's largest ad agency.

DRGM Advertising and Public Relations, headed by President Michael Mayes, pulled off an upset at this week's Nevada Commission on Tourism meeting when the company won approval of a two-year contract that had been held for 16 years by R&R Partners, the state's largest agency.

In choosing DRGM, the commission opted for an advertising strategy that would expand on an adventure theme the state adopted two years ago.

R&R developed that adventure theme, but focused on attracting "extreme sports" enthusiasts to the state. R&R believes the emphasis has worked and urged the commission to continue that approach.

DRGM countered with a proposed campaign that is somewhat softer and that executives said would appeal to a larger mix of outdoor enthusiasts.

"It's a tough account," Mayes said after winning the contract. "Nevada has an image that is very difficult to project. We have all the gaming glitter, yet we have this 'Death Valley Days' feel. We wanted to convince the commission that we could talk to a broader audience."

Mayes said he knew it would be difficult to go up against an incumbent company -- DRGM was the incumbent when R&R took over the state account 16 years ago and Mayes was with DRGM when that occurred.

"They know the product very well, they made the Nevada campaign what it is," Mayes said of R&R.

DRGM is ranked the No. 3 ad agency in Las Vegas by capital billings in the 2002 "Book of Business Lists" published by In Business Las Vegas, a sister publication of the Las Vegas Sun. In that list, DRGM reported $45 million in billings in 2001 and 40 employees compared with $135.5 million by R&R and 150 employees.

Four of the nine voting members of the commission approved the contract. Lt. Gov. Lorraine Hunt, who chairs the board, and commissioners Chris Barnbeck, Punam Mather and Chuck Scharer were not present for the vote and Commissioner John Marz declared a conflict of interest.

Marz -- the "M" of DRGM and a founder of the agency -- now heads the marketing department of Mandalay Resort Group, which contracts with R&R for its advertising. While he did not vote, he served on a subcommittee that recommended DRGM for the contract.

Billy Vassiliades, chief executive of R&R, was gracious in losing the bid, saying he expected DRGM would do a good job with the ad contract. But other employees, who asked not to be identified, later said that company leaders were upset about losing the deal.

R&R won a consolation prize of sorts. It was awarded the public relations contract for the Commission on Tourism and will work with state staff members to make media contacts to promote visitation to the state. Although DRGM has "public relations" as part of its corporate name, it does not have a PR division.

The PR contract is less lucrative than the ad contract. Last year, the state was billed $96,000 for public relations and $3 million for advertising by R&R.

The state's tourism advertising budget is one of the lowest in the nation, according to a research report issued last month by the Travel Industry Association of America. Nevada was tied with Wyoming for the lowest tourism ad budget in the West, with $2.4 million earmarked for ad buys.

The top state tourism advertiser in the nation is Hawaii, spending $56 million. California is ranked eighth in the nation and spends $15.7 million. The average ad budget nationwide is $3.5 million.

Monday's selection process was a competition based on performance and not by bid. DRGM and R&R will now negotiate financial arrangements for their respective contracts.

In Monday's meeting, the two agencies, whittled from seven submittals, were given 45 minutes to make a presentation about their vision for a Nevada ad campaign. That included presentations of past work and the unveiling of print and television ads proposed for the future.

R&R showed highlights of its "Bring It On" campaign targeting extreme-sports enthusiasts that include back-country backpackers, rock climbers and "heliskiers" who plow through virgin snow in Elko County's Ruby Mountains after being dropped off by a helicopter.

Vassiliades and his team said that in 2002, a year when tourism was off nationwide, visitation was up in Nevada's rural counties, at Bureau of Land Management recreation areas, at Great Basin National Park and at KOA Kampgrounds franchises in Nevada, proof that the R&R campaign for the state was working.

Randy Snow, who heads R&R's creative team, promised "a little less agony and a little more ecstasy" as the campaign evolves, taking some of the emphasis off serving the rugged outdoors enthusiast. But company officials said they were working with car-maker Nissan to offer a statewide "treasure hunt" for a 2004 Nissan Xterra vehicle with keys hidden in remote Nevada locations, a clear bid to stir interest among back-country enthusiasts.

DRGM followed with its own rendition of attracting outdoors enthusiasts, making a broader appeal to boaters and fishing enthusiasts as well as back-country trailblazers.

One ad example focuses more on families in the company's "Nevada. Always an adventure" campaign. Headlines for the campaign include, "Seeking fearless adventurers and their parents," and "Experience extreme strolling and hard-core ambling."

The DRGM team also said it wanted to increase the emphasis of Nevadans from Las Vegas and Reno visiting rural destinations in the state.

"If home means Nevada, welcome to the rec room," one ad says. "A big beautiful space bursting at the seams with every kind of outdoor experience. Are you head-first or easy-does-it? Flat out or go-with-the-flow? It's your pace in your place. And when you want adventure, there's no place like home."

Commissioners Ray Pearson and Van Heffner said they felt the state would get the best both companies have to offer by selecting R&R to handle public relations and DRGM, the advertising.

But ex-officio Commissioner Manny Cortez, president and chief executive officer of the Las Vegas Convention and Visitors Authority, said splitting the responsibilities among the two companies could lead to some friction in the future. He said having one company for the LVCVA to go to following the Sept. 11 terrorist attacks helped Las Vegas develop a strategy quickly and led to a quick recovery for the market.

That company was R&R.

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