What do you call a company with agency capabilities that is not an agency, but only offers "agency services" as part of a whole range of other services? Enter Active International, a "Corporate Trading Company." If your company happens to be within the Forbes Top 1000, you may know it by name.
Not me. While talking to them on the phone, I felt like a complete idiot. Active International has made significant media buys, ranking them with, or close to, the top media spenders in the industry. Not only did I not know what it is, I had not the slightest bit of familiarity with its business model.
So, feeling like a dolt, and yearning to find out how uninformed I was compared to my peers, I sent e-mails out to a number of my contacts to see if they had heard of Active International. Out of twenty, sixteen came back negative. The last four did not reply. Feeling a bit better about myself, I started to do a little research that led to my understanding.
Active International functions as a corporate trading partner. Corporate trade is loosely based on the concept of barter, exchanging one commodity for another much needed commodity. Barter sounds relatively archaic; something used in feudal economies. Corporate trade, however, is commonly used in many companies among the Fortune 1000.
Megalithic Foods has a line of products that is doing very well in the market. However, its Rhino Buddy Crackers, in production for the last two years, isn't very popular and the factory has been operating poorly. Thus, Megalithic plans to shut down the factory and take a loss. At this point, Active International enters and assesses the situation. It looks at the distressed assets (the factory and remaining inventory) and determines if there is a potential for redistribution. Let's say that in this case, the potential exists, and Active makes an offer to Megalithic Foods to take the factory and the inventory.
If the offer is approved by both parties, the deal is finalized and Active acquires the distressed inventory. In Megalithic's accounting books, the income is listed as a "trade credit" to be used as needed. After employee wages and benefits are paid, the next largest expenses for corporations are advertising and promotion. Megalithic decides to pump up its ad expenditures via the trade credits. Luckily for Megalithic, Active International has an elite team of media professionals available to easily implement a large-scale media buy.
How large? Past transactions show that Active International has placed spots in high profile shows and special events such as the Super Bowl. Although it continues to acquire assets, it has evolved into a diversified marketing and business solutions provider.
Active International is not only able to provide its clients with a solution to a problem, but it is also available to reinvest those trade credits where the client needs the most help, including media, supply chain, storage, etc. This is a fantastic example of a company that has based itself in solutions, and not problems. Foresight and progressive thinking enable them to provide clients with services an agency cannot: fulfilling one goal while eradicating another.
If you'd like to find out more, there are websites available that will provide basic information, such as Corporate Trading Tips. Adweek also ran an article regarding corporate trade that can be found online in its December issue, called "Tricks of the Trade."
Or, contact Active International directly via its contact page.