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Digital Cluster Begins Taking Root

As digital marketers develop innovative ways to promote products and brands, they increasingly are embracing downtown San Diego as a place to work and live.

While this online business can be conducted from any city, a cluster of such firms has formed here, said Lauren Alexander, vice president of marketing at the Underground Elephant marketing firm. That’s because millennials, the 20- and 30-somethings who make up much of the digital marketing workforce, find the location to be creatively stimulating.

“I am a native San Diegan,” Alexander said. “I thought I would have to move out of San Diego to find a job in this industry, but there is a blooming group of companies. San Diego is such a great place to live; we are attracting talent from other cities.

“The vision is that it is going to be a hub of innovation, whether it is software, marketing, or digital advertising. What’s behind this? There isn’t a logistical advantage. It’s the idea of a creative culture. Likeminded creative types are attracted to downtown San Diego. These people continue to found companies and expand their businesses and are determined to remain in San Diego.”

Promoting Products and Brands

Digital marketing involves promoting products and brands using electronic media. It differs from traditional marketing in that it collects data that enables companies to analyze the effectiveness of marketing campaigns.

Digital marketing includes the use of such platforms as websites, email, computer applications and social networks. Marketers reach consumers via such devices as personal computers, smartphones and tablets.

Underground Elephant develops and manages custom digital marketing services, software and platforms for insurance firms and their agents.

Alexander has been with the company since it began almost six years ago. Underground Elephant now employs about 60 people and is planning to move this spring into a larger space near Petco Park.

Learning to Grow and Thrive

One of the biggest challenges facing digital marketers is finding the talent they need to expand.

According to data from the state Employment Development Department, since 2013 employment in advertising, public relations and related services has grown 7.5 percent in San Diego County, from 4,165 to 4,478 workers.

The Downtown San Diego Partnership says the number of firms with such services has risen from 418 to 452. Although many salaries remain flat in today’s economy, the median wage among these firms has grown nearly 10 percent, from $55,000 to $60,400.

While not all of these local companies specialize in online services, they illustrate a trend. The downtown partnership reports that 10 local online advertising or marketing firms made Inc. Magazine’s list of the nation’s 5,000 fastest-growing companies in 2013. Only five made the list a year earlier.

Attracting the Best Talent

While digital marketers can do business from any city, “they have clustered in San Diego,” said Kris Michell, president and CEO of the partnership. “They want to attract the best in talent, the best in class. Therefore, they want to be in a place where people want to live.”

Lifestyle was one of the things that attracted Matt Faulk to San Diego. Faulk is CEO of the Basic brand design agency and said he brought his marketing and advertising company to downtown’s East Village neighborhood “to be immersed in what is happening here.”

“There definitely is a vibe that is starting to pick up,” he said. “It is where the action is right now. There are coffee shops, art shows and special events. Some good stuff is happening.”

Faulk said his business employs 14 full-time workers. It’s difficult to name a single reason why marketers have clustered downtown, he explained.

“There are great schools, a great talent pool, brands that you can leverage, all of the biotech companies,” he said. “There is technology and on top of that there are great minds and leaders.”

East Village Is the Future

“East Village definitely is the future,” said Chad Robley, founder of Mindgruve, a firm that provides integrated Internet marketing strategies. It has about 50 employees.

The East Village neighborhood “is a great blend of art and culture, and things to do,” Robley said. “It’s walkable.”

Young professionals in the digital marketing field like the lifestyle, he added. “They want to be able to live and work within walking distance. We have a great city.”

Stephan Goss, CEO of Zeeto Media at 10th Avenue and B Street, said the area is reaching a critical mass in which companies have plenty of talent to choose from and workers have a variety of opportunities. He has about 55 employees.

Goss said he was living in New York four years ago when he decided to relocate to San Diego.

“I heard it had nice weather,” he said. “I was in Manhattan. I had just gotten out of college. San Diego seemed like the right destination. There are quite a few (digital marketing) companies here that have been successful. It definitely is growing very quickly. The companies are starting to grow very aggressively.”

Goss said one reason young entrepreneurs are attracted to digital marketing is because it’s possible to start up a business without a large upfront investment.

“There are so many opportunities to get into the space without getting massive funding,” he said. “It has been very exciting.”

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