NEW YORK - Creative, catchy and selectively-placed advertisements in prestigious, upscale media can enable even a small mutual fund family to compete with the mutual fund Goliaths that spend tens of millions of dollars on advertising, said Victor Ugolyn, chairman, president and chief executive officer of The Enterprise Group of Funds of Atlanta.

A few well-placed TV commercials on a highly-regarded cable network such as CNBC, or a series of splashy ads in an upscale consumer magazine such as Town & Country can do a lot for the image of even the smallest, least-known fund company, Ugolyn told a gathering of the Financial Communications Society here May 24.

Because "the mutual fund business is a marketing-driven business" where image has almost come to mean as much as performance, even a small fund family must rely on advertising and public relations to project a strong, authoritative image, Ugolyn said.

"Even if you are a little guy, you can look like a big guy if you have interesting creative and are smart and selective in [the placement of] your advertising," Ugolyn said. "Run a campaign on CNBC that gives the impression of being a major player. Run ads that give the impression you are bigger than you are," suggested Ugolyn, whose own firm launched its first television advertising campaign exclusively on CNBC in May. (MFMN 5/1/00) Since Enterprise began running these ads, its profile and status among the broker/dealers and financial planners who distribute its funds have risen considerably, Ugolyn said.

Most small- to mid-size fund companies would despair of trying to rival the advertising budgets of Fidelity Investments of Boston, Merrill Lynch of New York or Morgan Stanley Dean Witter of New York, Ugolyn said. Fidelity spent $150 million, Merrill spent $91 million and Morgan Stanley spent $66 million on advertising in 1999, according to Financial Research Corp. of Boston. Enterprise's advertising budget is $1 million.

A fund's advertising campaign should be based on a unique idea that conveys authority, Ugolyn said. Enterprise's print ads stress FRC's assessment that Enterprise is one of the top five mutual fund companies to watch in 2000, Ugolyn said. The ads also note that Enterprise's assets under management grew 4,300 percent from $200 million to $9 billion in 1999, he said.

Enterprise is running its print ads in both consumer and trade publications, Ugolyn said. If a company cannot afford consumer publications, it should at least advertise in the trade press, to reach intermediaries and financial journalists, he said.

"We have no problem with someone flipping through On Wall Street, Ticker or Registered Rep and seeing that Enterprise is one of the fastest-growing fund families," Ugolyn said.

Enterprise's broadcast advertisements are set at a golf course to appeal to wealthy investors and intermediaries, most of whom are male and who identify with golf, Ugolyn said.

"We wanted to establish an image of old money - to be more white shoe' than even Goldman Sachs," Ugolyn said. "Project a first-class image at all costs, even on your promotional materials."

Enterprise has also relied heavily on public relations to gain notoriety in the trade and consumer press, Ugolyn said. The fact that Enterprise Group of Funds relies on some of the leading names in the business to manage its 13 funds has received wide coverage, he said. Enterprise's partners include Gabelli Advisors of Rye, N.Y., Alger Funds of New York and Marsico Funds of Denver.

Late in 1999, Enterprise conducted a poll of its portfolio managers, asking them how they thought the stock market would perform in 2000. That resulted in a full-page article in Barron's, Ugolyn said.

Public relations has been such a boon for the Enterprise Group of Funds that the firm is considering hiring a chief economist, whose primary function will be to give interviews on CNBC, CNN, CNNfn or to The Wall Street Journal and various trade publications, Ugolyn said.

"Public relations is a very cost-effective way of getting your story across," he said. "It has been our major driver."

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