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Often, money spent on recruitment is what

Neither rhyme nor reason behind most marketing budgets

There’s no rule of thumb in assigning the marketing portion of an economic development agency’s budget. More often than not, money set aside for advertising, promotions, trade shows and recruitment is what’s leftover.

“There’s never enough specifically for marketing and recruitment,” said Sherry Vance, spokesperson for the Mississippi Development Authority, who handles all of the economic development marketing for the state.

MDA’s 2001 budget totaled $92 million, including state and national funds. Of that, the marketing budget is $1.9 million. After updating all printed material for the agency, funding various projects and other expenses, Vance said she’s left with $300,000 to $500,000 to market the state.

“If we ran three ads in USA Today that were of any substantial size over a one year period, essentially our budget would be gone,” she said. “Instead, we’re tailoring our materials, our message and our visitations to trade shows to industry specific publications.”

Since 1998, MDA’s marketing budget has been nearly cut in half. In 1998, it was $3.6 million. In 1999 and 2000, it was $2.8 million and $2.9 million, respectively. In 2001, the marketing budget was $1.9 million.

“Last year, the overall budget was cut 11.6%,” Vance said. “It’s important to us as an agency for people to understand we are the key economic development association. We believe that, perhaps unlike other agencies, when you make an investment in economic development, you’ll see that investment pay off.”

The Harrison County Development Commission’s overall budget of approximately $9 million may seem bloated at first glance, but the commission operates four industrial parks covering more than 2,500 acres and maintains two water and sewer systems and two navigable waterways.

On the flip side, the commission generates fees for water and sewer, land sales and leases and only one-ninth of its total budget is publicly funded. The commission’s advertising and marketing budget for 2001 is $205,000.

“It’s difficult to compare our budget to other economic development associations in the state because we have a completely different set of circumstances being located on the Gulf,” said Michael Olivier, executive director of the Harrison County Development Commission.

Jay Hambright, senior vice president of economic development for the MetroJackson Chamber of Commerce and senior vice president of the Metro Economic Development Alliance (MEDA), the economic development and marketing arm of the chamber, said the budget for the chamber and its participation in MEDA is $300,000 a year, of which $120,000 is for salaries and overhead.

The MetroJackson Chamber of Commerce, Hinds County Economic Development District, Madison County Economic Development Authority (MCEDA), Rankin First Economic Development Authority and Jackson Municipal Airport Authority contribute to and equally share the marketing budget of $181,418 a year for MEDA.

Even though the Nissan plant is being built in Madison County, Hambright said MEDA is maintaining the same budget.

“We’re being more proactive,” he said. “In October, we’ll attend an automotive trade show in Greenville, S.C. Earlier in the year, we went to Detroit for the automotive show, in conjunction with the state and our partners. We do consultants’ tours and mail outs. All of that is in addition to prospect handling.”

Jerry G. Acy, executive director of MCEDA, said his organization’s overall and marketing budget hasn’t increased since Nissan announced plans last November to build an automotive plant near Canton.

“Our marketing arm is MEDA, and that budget has stayed constant,” he said.

Charleigh D. Ford Jr., executive director of the Columbus-Lowndes Economic Development Association (CLEDA), said the agency’s overall annual budget is $574,000 and the marketing budget is about $21,000.

“That doesn’t include the chamber’s budget,” he said. “I don’t know what that is, but put together, it would be significant.”

Many public and/or private foundations have successfully supplemented their overall budgets — and marketing money — via fundraising campaigns.

The Community Development Foundation, a private economic development association in Tupelo, earmarked roughly one-third of its $1.6 million capital campaign for advertising and marketing. The Future Focus campaign, scheduled to end in August and already exceeding its goal, was extended another month and will probably increase its advertising and marketing money accordingly.

The Hattiesburg Area Development Foundation set aside $250,000 over the next five years for image enhancement, part of which will fund marketing above the foundation’s regular budget. Because more than $2 million was pledged during the $1.75 million Partnership for Tomorrow campaign, the marketing money will probably increase.

In a smaller market, the Brookhaven/Lincoln County Chamber of Commerce and Industrial Development Foundation successfully raised $1.5 million in a capital campaign that recently ended. The funds are earmarked for a new industrial park, industrial recruitment, existing business and industry retention and expansion and workforce development, said Chandler Russ, executive vice president of the chamber.

“It was a total community buy-in on the campaign,” Russ said. “We were really pleased with the results. It also gave us a pool of money to access – up to $200,000 at little or no interest – to help push a deal in our favor.”

Without the capital campaign fund, the overall budget for the Brookhaven/Lincoln County Chamber of Commerce and Industrial Development Foundation is $250,000, of which 20% is for marketing, Russ said.

To supplement economic development associations’ marketing budgets, MDA provides Marketing Match Grants, rebating some community associations 50% of marketing costs. Last year, MDA awarded nearly $300,000 to 51 economic development groups, which came from the agency’s marketing budget.

“If they need material to market their community to highlight services and attract companies, they apply to us for a grant,” Vance said. “We have a committee that reviews those applications daily.”

Contact MBJ contributing writer Lynne Wilbanks Jeter at lwjeter@yahoo.com or (601) 853-3967.

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