A firm practices what it teaches - CareerTrack Inc

Nation's Business, Dec, 1991 by Howard Rothman

What would you do if your 9-year-old company--consistently acclaimed as one of the fastest-growing privately held firms in the U.S.--was hit so hard by recession and Gulf War jitters that annual sales all but stopped growing?

If that happened and you were Jimmy Calano, president and chief executive officer of CareerTrack, Inc.--a Boulder, Colo.-based producer of self-improvement seminars for individuals and corporations--you'd do just what you suggest your seminar participants do: Think positively, hunker down, and reposition your company for the challenges ahead.

"We worked morning, noon, and night and literally reinvented the company," says Calano, 33. He and co-founder Jeff Salzman, 36, streamlined CareerTrack's direct-mail operation, dropping unresponsive names from their extensive lists and getting in touch more often with proven customers. They shifted their marketing emphasis to reflect workers' real concerns, such as surviving the recession.

Calano and Salzman negotiated to bring several "name" presenters to their company while developing new seminars that stressed personal and professional skills for hard economic times. They re-emphasized similar existing programs, like the for-women-only "Self-Esteem and Peak Performance" seminar, which offers advice for turning improved self-image into increased productivity.

As a result, Calano says, he and Salzman turned probable disaster into opportunity--and without laying off any of their 390 employees. "We had to get sales up," he says, "and we did it."

That is what you would expect from Calano and Salzman, who, through hard work and aggressive innovation, built what they say is now American's largest one-day training company. In 1982, they started with just $10,000--all of it their own money--and produced programs in a handful of U.S. cities. By 1990, they were recording $66 million in revenues from public seminars in 500 cities in 20 countries, private seminars for some of the world's best-known corporations, sales of audio and video products, and rental of a mailing list with 2 million names.

"When we started, we had no business plan and no system," says Calano, who usually serves as spokesman for the pair. "We did know about marketing, meeting planning, and processing registrations." The other elements of building and running a successful training company--hiring and training presenters, developing seminars, making financial and legal decisions--"we had to learn along the way."

Calano and Salzman took by storm an industry estimated by its own trade magazines and organizations to be crammed with 3,000 vendors offering 125,000 programs. By 1990, CareerTrack was presenting 6,500 seminars to 750,000 participants each year.

When Calano and Salzman first met, their plans were more modest. Calano, then 24, was producing customized in-house business training seminars in Denver and owned a mailing-list rental company. Salzman, then 27, owned an advertising agency in Boulder. They immediately decided that their talents were complementary--and suited to what they saw as an imminent boom in business-oriented self-improvement seminars. In March 1982, they joined forces to offer a program for working women.

Calano knew the training industry, and he knew direct marketing; Salzman was a copy-writing pro. So Calano picked up the numbers side of the operation (law, finance, seminar registration, meeting planning) while Salzman concentrated on the words (seminar creation, speaker selection, brochure production). In their first year they grossed $220,000.

But a snag soon developed. At the time, Calano explains, only about two dozen cities were considered large enough to be potential markets for one-day seminars, and after one round with CareerTrack's lone offering, almost all of those markets were temporarily exhausted. In addition, Calano and Salzman felt their going rate of $165 to $195 for one-day sessions was unaffordable for many.

"We decided upon two strategies to attract attention: convenience and affordability," Calano says. The first was achieved by expanding into previously ignored markets, ranging from Absecon, N.J., to Pendleton, Ore. The second involved dropping prices, first to $125, then to $95, and eventually to $45 for most of their one-day seminars.

"We kept taking our programs to smaller and smaller cities, essentially targeting any place with a population of 25,000 or more. At the same time, we stretched training budgets, allowing managers to send four or five of their people to our seminars instead of one," Calano recalls. "The response was phenomenal."

By expanding to smaller cities, they gained entry into untapped markets. Also, they found that by cutting admission to one-fourth the going rate, they signed up five to six times as many participants, more than making up the difference. With the addition of top-notch seminar leaders, and with programs by such well-known management gurus as Tom Peters and Ken Blanchard, growth was rapid. But so was duplication of their best efforts by the competition, says Calano. Low-priced seminars became commonplace; small cities soon were the sites of more and more programs; audio tapes that mimicked the style and content of CareerTrack's own tapes increasingly appeared on the market.