Industry Watch

Chris Behrens, president and CEO of YA. Photo by Emily Davis

Bedtime for boxtops

How a funder’s rep transformed paper-based Young America to the sleek, digital YA

By Kevyn Burger

From his corner office in the Lumber Exchange Building in downtown Minneapolis, Chris Behrens enjoys a picture-perfect view of the five-story-tall Bob Dylan mural, painted on the building directly across the street.

Featuring three images representing the long career of the Minnesota-born musician, the eye-catching triptych is entitled “The Times They Are A-Changin’.”

That could be Behrens’s mantra as he goes about revitalizing an iconic Minnesota business, transforming the company known as Young America into its new incarnation as YA.

“I’m the seventh CEO in 12 years, but I’m here to stay,” declares Behrens, 55, whose route to the leadership of the 110-employee (in Minneapolis) business took several startling twists.

Formed in the early ’70s, Young America took its name from the Carver County community where it was headquartered. For decades, it was a fulfillment house, hired by Fortune 500 companies to manage their contests and coupon returns and to churn out their rebate checks to consumers.

“A lot of people still remember sending their box tops to Young America,” Behrens says.

But the company lost momentum during the recession, and rebounding was difficult in the digital/mobile era, with brand name clients shifting from paper and mail-in promotions to online rebates and text-to-win sweepstakes.

With its fortunes declining, in 2012 the three banks that held Young America’s debt asked the owner to find a buyer, but none emerged. 

The trio of lenders each named a representative to a board set up to decide the company’s fate.

Behrens, whose background is marketing and turnarounds, was appointed to the board representing the interests of BMO Harris.

“When we got involved, the company had an antiquated computer system and was stuck in the old economy, languishing because it hadn’t made the transition,” says Tom Reusché, appointed to the board by Maranon Capital. “We recapitalized the company to first stabilize it while we figured out how best to scale it.”

Behrens went on the road for face time with longtime clients to gauge their satisfaction with Young America. 

“When we asked if they would continue to work with us if we strengthened our digital capabilities, clients wanted to see the company evolve digitally in order to be willing to stay,” Behrens recalls. “We saw that to continue to exist, we had to be relevant.”

Armed with that ultimatum, the board restructured the businesses and in 2013 the banks they represented took over ownership. The lenders allocated funds to build a digital framework and hire sharp new IT, project management and marketing talent.

“When I started, we had one sales manager and one account manager,” says Behrens, who was named president and CEO of the rejiggered company. “Now we have 22.”

Behrens, the board and company’s senior leadership pulled together a three year-strategic plan that turned Young America into YA. That included relocating, moving from the company’s 165,000-square foot warehouse in Norwood Young America to the crisp open-floorplan office that stretches across the seventh floor of the Lumber Exchange.

“It was exciting when Chris came. We have a pocket of tenured employees who’ve worked with these accounts for years. So many of us hung in because we remembered  what it was like on the high side and we were confident YA could grow to its former state and size,” says Janet Fahey, YA’s vice president of human resources who’s worked for the company for two decades.

A Norwood Young America resident, Fahey watched her daily commute expand by 40 miles one way, but she’s not complaining.

“When you get to where you want to be, you don’t mind the drive to get there,” she says.

The move downtown made it easier to recruit teams of strategists, software engineers and digital whizzes to build the online interfaces for clients.

“It feels like a 42-year-old startup, but startups don’t have a legacy of doing business with great companies,” says Bill Koschak, YA’s new CFO who came to the company from General Mills.

“The other side of that is that we had to change deep-seated ways of doing business. That’s baggage that startups aren’t usually burdened with.”

Behrens calls the resurrected YA “intensely client-centric,” now boasting a list of 80 clients that represent 162 brands.

T-Mobile worked with the company in the era of mail-in rebates and has seen its relationship with YA reinvigorated in the past two years. YA manages the wireless communication company’s perks to attract and retain customers.

“[YA] has shown us their adaptability. They’ve grown their capabilities to suit our needs, and it’s not their typical niche. They have gone into uncharted territory with us,” says LaDawn Beardsley, T-Mobile’s director of service partner operations.

“They design offers we bring to market and technically execute them on the back end. Those offers are often done on a short runway in an extremely competitive environment. They have not failed to deliver, and that makes them a strategic partner.”

The repositioned YA’s revenues have quickly rebounded, growing 33% over the past two years, and Behrens says the times aren’t done a-changing.

“What we’re accomplishing is not the CEO’s plan, not the board’s plan,” Behrens says. “This is our plan. We’re entering a growth period and we all feel like we’re working for a winner.”