Why federal contractors are eyeing California—but need to tread carefully

If you’ve been tracking the federal marketing landscape, you already know: things are volatile. Fewer opportunities. Major IDIQs are being pulled post-submission. Some agencies are restructuring entirely.

That’s why more federal-focused advertising and communications firms are looking at California—and other states—as strategic growth markets.

California stands out for good reason: it’s the largest state government in the country, with billions flowing into public health, transportation safety, insurance enrollment, behavior change, and equity and housing communications. The scale often mirrors federal campaigns.

That said, it’s a market you need to approach strategically. We’ve supported several firms in transitioning into California, including:

• Navigating the CMAS schedule to bypass open RFPs

• Structuring compliant proposals aligned with California’s equity and localization priorities

• Building partnerships with DVBE/SB firms to unlock scoring preferences

• Developing gameplans aligned with Cal eProcure registration and sourcing nuances

• Teaming on RFP responses with reputable California firms

• Strategic alignment and positioning within state departments based on firms’ qualifications

But here’s what often surprises firms used to the federal model:

• California procurement is highly fragmented. There’s no GSA or SAM.gov equivalent. Each agency—Covered California, Caltrans, CDPH, CA Lottery, EDD—procures independently. Some use Cal eProcure. Others use outside procurement consultants. Some contracts require CMAS. Others do not.

• There is no one-size-fits-all playbook. Add to that a growing field of experienced in-state firms, and the result is a saturated—but still navigable—landscape. 

Before diving in, consider:

• Does your agency meet the minimum quals (e.g., in-state registration, prior equity-focused work)?

• Can you show cultural competency across California’s diverse populations?

• Do you have DVBE or SB partners secured—or know where to find the right ones?

If you’re exploring California—or even other state markets—we’re happy to share a market landscape briefing tailored to your footprint. It’s one of the ways we’ve helped agencies diversify beyond the federal space while maintaining high-value public sector work.