A MARKETING RESEARCH STUDY TO DETERMINE THE DEMAND FOR A
NEW FULL-SERVICE AD AGENCY IN CHESHIRE COUNTY
Prepared for
Dr. Jason Little
Prepared by
Kristen Bartini
Jennifer Bulcao
Matt Naffah
Justen Nagle
Sheila Nagle
Marketing Research Course
Franklin Pierce College
Rindge, New Hampshire
December 2004
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Contents
Section Title Page Introduction 4 Nature of the Problem 4 Purpose of the Project 4 Problem Statement 4 Research Objectives 4 Definition of Terms 4 Literature Review 6 The Full-Service Advertising Agency 6 Market Trends 8 Small Business Trends 12 Payment by Results 14 Methodology and Procedures 17 Problem Identification 17 Development of Survey 17 Definition of Population 17 Sample Size 17 Data Collection Method 18 Assumptions 18 Results 19
Question One 19 Question Two 19 Question Three 19 Question Four 19 Question Five 19 Question Six 19 Question Seven 20 Question Eight 20 Question Nine 20 Question Ten 20 Cross-Tabulation One 20 Cross-Tabulation Two 20
Limitations 22 Sample Size 22 Human Power 22 Money 22 Transportation for One Group Member 22 Unwillingness of Businesses to Attempt/Complete Surveys Accurately 22
Full-Service Ad Agency 3
Discussion 23 Conclusions 25 Recommendations 26 References 27 Appendix A 28 Appendix B 29 Appendix C 30 Appendix D 31 Appendix E 32 Appendix F 33 Appendix G 34 Appendix H 35 Appendix I 36 Appendix J 37 Appendix K 38 Appendix L 39 Appendix M 40
Full-Service Ad Agency 4
Introduction
Nature of the Problem
Despite the fact that there are 24 cities and towns found in the Cheshire County,
there are only two full-service ad agencies. A mere two ad agencies exist to meet the
needs of the hundreds of businesses that reside in this county. With a need to service a
total population of 73,825, at least one more ad agency is necessary to meet the demand
of these people and their hundreds of local businesses (U.S. Census Bureau, 2000).
Purpose of the Project
The purpose of this marketing research project is to identify an opportunity. The
opportunity relates to Franklin Pierce College students who are interested in
entrepreneurship. It is possible that as these students approach graduation, this
prospective business idea will be taken into serious consideration.
Problem Statement
Research is necessary to determine if there is a demand for a new full-service ad
agency in Cheshire County. The results may be used in aiding Franklin Pierce College
graduate entrepreneurs with respect to opening such a business in the near future.
Research Objectives
The research objectives include:
1. To identify advertising services that perspective clients would find useful
2. To identify service deficiencies of existing ad agencies in Cheshire County
3. To determine the appropriate target market
Definition of Terms
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Advertising Agency. Falling under North American Industry Classification
System (NAICS) code 541810, the U.S. Census Bureau defines advertising agencies as
an industry comprised of, “establishments primarily engaged in creating advertising
campaigns and placing such advertising in periodicals, newspapers, radio and television,
or other media. These establishments are organized to provide a full range of services,
for example through in-house capabilities or subcontracting, including advice, creative
services, account management, production of advertising material, media planning, and
buying (U.S. Census Bureau, 2000).
Cheshire County. According to the U.S. Census Bureau, Cheshire County is
defined as Alstead, Chesterfield, Dublin, Fitzwilliam, Gilsum, Harrisville, Hinsdale,
Jaffrey, Keene, Marlborough, Marlow, Nelson, Richmond, Rindge, Roxbury, Stoddard,
Sullivan, Surry, Swanzey, Troy, Walpole, West Swanzey, Westmoreland and Winchester
(2000). Census 2000 came to the conclusion that Cheshire County included 73,825
people, 28,299 households, and 18,790 families, with a median income of $51,043 for a
family (U.S. Census Bureau, 2000).
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Review of the Literature
The Full-Service Advertising Agency
According the to the Census Bureau, the NAICS code for a full service
advertising agency is 541810 and is defined as “an establishment primarily engaged in
creating advertising campaigns and placing such advertising in periodicals, newspapers,
radio and television, or other media. These establishments are organized to provide a full
range of services (i.e., through in-house capabilities or subcontracting), including advice,
creative services, account management, production of advertising material, media
planning, and buying (i.e., placing advertising) (2004).
Along with that, there are four intricate components that make up a competitive
and strong full service agency. These components are diagnosing the marketing and
brand problem, positioning the product in relation to the target consumer,
communication, and evaluation. With out these components, and agency would not be
able to survive and adapt to the ever changing industry.
Diagnosing the marketing and brand problem. The first component of a full-
service advertising agency is diagnosing the marketing and brand problem. This
component is research based- looking at everything from competitors, brands, product
category and consumers. From there, the brand core is defined: Who are the brands prime
prospects? Where are they? What are their demographics and psychographic
characteristics? How does the product fit into their life style? How do they regard this
type of product; this particular brand; competitive products? What one-benefit do
consumers seek form this product; this particular brand? In what distinctive way can the
product solve the prime prospects? What media will best reach your market?
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This component is really important because it not only helps define your brand
core but also is a great selling point for a full-service advertising agency. Some agencies
sell their research capabilities to their clients in hope to win a bid over competitors.
Having strong research is what will define your agency and make you stand out from
everyone else.
Position the product in relation to the target consumer. Using the answers from
the research conducted, a strong strategy is formed that allows the agency to position the
product in relation to the target consumer and emphasizes the appeal of the product
toward the target consumer. Within this component, you also define goals, how to
intensify brand imagery and recapturing prior users, and plan how to carry everything
out. According to R.D. Smith, “Organizations are successful to the extent they enjoy a
strong reputation, which results from neither accident nor luck. Strategic planning can
identify and evaluate an organization's visibility and reputation. No organization can
afford to be a "best-kept secret" among a relatively small number of supporters;
continuing effectiveness requires the development and maintenance of a strong and
positive reputation” (2002).
Communication. After a complete strategy is created and all copy and rough
layouts have been decided on and prepared, it is time to decide on what communication
the agency wants to use. First the agency puts together a media plan, which is a complete
analysis and execution of the media component of a campaign. Next, the agency creates a
total plan, which is when roughs of the copy, layouts, and production costs, along with
the media schedule and costs are presented. This eventually is calculated and creates the
total cost.
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Evaluation. Finally, an evaluation plan is created. The evaluation step in the
process is both the end and the beginning (Russell & Lane, 2002). “It is the moment of
reckoning for the creative work, based on the objectives set in the beginning, and
provides the evidence needed to refine and advance future efforts. As such, it is an
accountable system” (Russell & Lane, 2002).
Market Trends
The marketing science that our company is intending to develop is embarking on
a field that is in constant transition. With the continuing innovation of new technology, it
is important to stay up to date and yet grounded to reality. With more options, it is
important to make informed decisions at to what is needed for each client individually.
The extent of a marketing research plan should stay proportional to the size of the client
and within their financial boundaries. “Regardless of how technology develops, we will
have more choices, more fragmentation, greater ability to target and segment, and far
greater complexity” (Gotlieb, 2004).
Evolving and ever adapting technology holds a strong impact on an agencies
success. With new resources come new responsibilities. Irwin Gotlieb conveyed the
urgency of adapting to his colleagues, “We have a responsibility to our clients to learn,
explore, understand and innovate” (2004). To properly service a client, agencies must
balance creativity, innovation and finances while trying to brand a client.
Potentially, these innovations could help a marketing division to be able to
segment the market to an extreme precisian. The wealth of knowledge that is now being
processed efficiently can be of great service to clients. Gotlieb notes how the change in
marketing research will also impact the creative industry; “Okay, so we fast forward 3-5
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years and the media agency is able to segment and refine targeting. We may even be able
to do addressable advertising on a large scale. What about the creative execution? All this
targeting and segmentation is for naught if you run the same creative across the board.
What’s the point of addressability if you are addressing everybody the same way? In fact,
every segment and target would need its own strategy, its own creative brief and its own
execution” (2004). Progressive stride in the marketing field will force the creative
counterparts to follow suit. Information is useless if you do not know how to apply it.
Other industry wide quandaries have been discussed at the 4A’s Media
Conference in Orlando, Florida. Hot topics included lack of return on investment, TV’s
inability to reach the public and discussion on creative output measurements. (McClellan
2004) TiVo and other media options are allowing consumers to avoid advertising while at
home. Advertisers must cope with this cut back and try to rebound by working their way
back into the consumer’s attention. McClellan summarized Jim Stengel’s reaction to this
situation, “The reason? Today’s marketing model ‘is broken.’ Too often, it offends,
harasses, and turns off the consumer, he said. Bottom line, Marketing tactics just aren’t in
touch with the public” (2004).
In response to low returns from television advertising, P&G clients have shifted
their budgets. Many of their brands reserved 90% of their advertising funds for television.
“But 2003 changed the ground rules” (McClellan 2004). Prilosec, launched by P&G used
only 25% of its ad spending on television.
Not knowing a commercial’s audience is troubling and expensive for major
marketers. As stated by Scott Berg, [worldwide media director, global branding and
communications of Hewlett-Packard], “If I know who is watching my TV ads, why
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would I pay for anybody who isn’t? If I can track that I got a million people who was my
TV commercial’—vs, the 15 million who tuned into the show—maybe that’s how I
should start paying for my media.” Although Berg argues that Nelson ratings are not
going to help, efforts have been initiated to increase knowledge about commercial
viewership.
The Association of National Advertisers and 4A’s (American Association of
Advertising Agencies) are struggling with Nelson Media Research currently on behalf of
advertisers and their agencies. Without competent knowledge about commercial
audiences, billions of dollars are currently being spent blindly. According to Advertising
Age, “The 4A's media-research committee has asked Nielsen to provide detailed audience
data from last April and October in 30-second increments so it can analyze commercial
ratings trends. Nielsen's data currently focuses on program ratings. (2004)” Advertisers
are looking for the same in-depth data related to commercial viewing that is produced for
program viewing.
Nelson Media Research’s current Npower system can provide information
minutely, but the calculating the data would require extensive resources that are not
currently available. “It's difficult to crunch the vast amounts of data that would enable
them to extrapolate trends and variance between program viewing and commercial
viewing. Npower technology was designed to help TV programming executives track
information such as how well a program retains its lead-in audience, but the data is not
gathered in a way that makes it easy to figure out commercial ratings”(Advertising Age,
2004). ANA and 4A’s will be meeting with Nelson to further discuss the issue.
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Speaking on behalf of the field, Bob Schmetterer discusses The Rise of
Advertising, “Creative thinking has always been the core of our industry. But what it
means and what it demands of us is changing on a massive scale. Transformative
thinking, revolutionary thinking; thinking that goes beyond media, beyond
communications entirely. This is the new creativity” (2003). Scmetterer also referenced a
recent study that found 90% of surveyed CEOs agree that creativity is and essential part
of a successful business yet less than 10% feel that they their business is meeting that
creative need (2003). The significant gap comes from a “Fear of Change.” To further
explain, Schnetterer notes, “A major barrier is a company culture that does not encourage
creativity or worse cuts it off at the pass with risk-averse, fearful thinking. And
underlying this is one of the most ubiquitous of human fears: fear of failure. Because the
risk of failure is inherent in any bold, new idea. Because you cannot achieve great
success without risking failure” (2003).
An advertising agencies strongest selling point is its creativity. To balance
between a client’s desires for creativity versus strategic logic, advertisers have to dance
carefully as to not come on too strong yet offer the full extent of service that the client
desires. Continuing to express how importance creativity even during difficult times
Schnetterer exclaims, “When people are afraid of taking risks, of making any mistake at
all, then they cannot make the bold leaps necessary for creative, nonlinear thinking. It's
human nature. In difficult times, we tend to hunker down. Yet in difficult times, history
shows that the businesses that are creative, those that go on the offensive, those that adapt
and are flexible, those are the businesses that succeed while others fail” (2003).
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Agencies, in the near future will also have to restructure their billing process. “We may
be one of the few remaining businesses in the world where the idea, the creative concept,
the strategy, the deal structure, and the deal itself belong fully to the client and are
transportable from one agency to another (Gotlieb, 2004). Intellectual property is difficult
to differentiate, so as the industry continues to expand with new technology, and thus
need for new creatives, revamping the old billing systems will be essential to financial
survival.
Currently agencies spend a huge budget to develop a proposal for a prospective
client. Eating the cost is industry standard. Furthermore, the rights to the ideas and
concepts that are generated in these proposals and during campaigns are for the client to
control. Advertisers are constantly subject to lose of money and accreditation when the
intellectual property rights are given to clients.
Small Business Trends
Within an advertising spectrum, there is much dependence on the target market,
or to who is being directly targeted. In our case, we are targeting small businesses, and in
order to know whom our target market will be and how to market to them we need to
know small business marketing trends. The hottest market trends for fiscal year 2003-
2004 are described below; this information will provide our team with the necessary
information on what some small businesses will be looking for to market.
The youth market is dominating for much of the advertising market, considering
that the teen age group spends the most money on consumer products. This can be
observed by looking at simple television commercials, and magazines. Many adult
magazines have simply “shrunken” in thickness. Opposed to teen orientated magazines,
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which have grown increasingly in size; for example Cosmopolitan and Men’s Fitness.
The advertisers have targeted the teens through ads in every possible way (Small
Business Trends, 2004, ¶ 3). Another popular trend for the growing teenage market is
that of aftermarket car parts and accessories. This trend has been growing since 2001 and
is projected to continue growing for the next few years. The smaller businesses that sell
only necessity car parts are now starting to stock aftermarket performance parts due to the
high demand of them (Small Business Trends, 2004, ¶ 4).
The quality of life trend has always stayed strong ever since the early 1980’s.
People, especially the baby-boomers, are very interested in keeping their youthful selves
in good condition. This has sparked the starting of many local gyms and fitness clubs
such as Curves. In addition, the supply for home fitness equipment is on the rise and
many people have seen infomercials and small advertisements for them. This is a perfect
opportunity and almost a sure investment if set up right. In turn, advertising needs to
prepare to efficiently attract people to specific types of wellness activities (Small
Business Trends, 2004, ¶ 7).
Along with the youth markets, it is also imperative that small businesses look at
the largest group of consumers, the baby boomers. This group of consumers is constantly
demanding the trendiest items on the market. Their buying is impulsive and strongly
depends on the hottest consumer trends. Small businesses need to be up to date on their
trends of they plan to receive business from these consumers. In addition, many of the
baby boomers shop with bargains in mind. They will spend time to search for the best
priced product for their dollar. A small business may have to adjust prices but if they can
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maintain business from this target group of consumers, it will show to be profitable
(Baby Boomers, 2001, ¶ 5).
When planning to advertise for small businesses it is important to know the trends
that some of the small businesses will follow. Also knowing what to research can help
smaller advertising firms concentrate on one central service as opposed to attempting to
specialize in all services.
Payment by Results
A major issue in new or even old advertising agencies is how to properly calculate
the appropriate remuneration. This can be done in whatever fashion that the particular
agency would like to do but there is a suggested way, which has a bit of a background
also.
For a bit of background, many advertisers and ad agencies consider their methods
of remuneration for many different reasons, such as agencies want to make sure that they
are remaining profitable in order to make sure they can still stay in service for their
customers. The Association of National Advertisers and the European Association of
Advertising Agencies decided that the average profit in percentage of 15% - 25%
operating profit would be considered good or fair. This percentage is taken from the
gross revenue of the company (Guidelines, 2004, ¶ 8).
There are four basic guidelines for agencies to effectively profit from their
advertising. The first guideline is to define and identify the area and amount of work
before deciding the amount of profit they will be obtaining from the deal. This is to
ensure that they are not loosing money for lots of service, and so that they do not over
charge the customer. Secondly, the agency needs to decide on a profit margin that fits
Full-Service Ad Agency 15
their specific needs. If the agency has three people working on the project using a large
amount of company resources than they need to make sure that the appropriate money is
being made in return for the service in order to positively fund the project. The third
guideline is to make sure that the remuneration is beneficial to both parties of the
business deal. This allows for both the customer and the agency to walk away feeling
good about the deal, also it give the opportunity for the project to be discussed in an open
environment, therefore allowing for the appropriate changes to be made with both parties
understanding the final agreement. The fourth guideline is to allow for constant review
of all areas of the remuneration, this will allow for the company and customer to see how
the percentage is being broken down. This allows for better understanding of what the
project has done for the company and if changes may need to be made in the future
(Guidelines, 2004, ¶ 10).
There are two basic methods for remuneration that agencies use today; they are
the commission system and the fee system. The commission system is when the agency
will receive a certain percentage from the product or service. For example, if an agency
charges a company $10,000 for a radio commercial, and they charge the average of %15,
they would be profiting $1,500 from the deal. This method is beneficial because it is
very easy to set up and operate, and it allows the customer to get a service at a locked
price. The disadvantages to this method are that the agency may only make a certain
locked percentage for both small amounts of work and for lots of work. There is also no
individual pricing on specific services, so the customer may benefit too much
(Guidelines, 2004, ¶ 12, 13). The second method for calculating remuneration is the fee
system; the fee system is when a company charges the customer a specific fee based upon
Full-Service Ad Agency 16
variable in the company. The variable consist of the peoples salaries working on the
project, equipment rentals, rent of the office space, travel costs, etc. These costs are
calculated and the agency will figure out how much to charge the customer so that they
will remain profitable form the situation. Some of the benefits are that the agency can
accurately forecast their financial situation; also, the customer only will pay for their
desired services (Guidelines, 2004, ¶15, 16). A few disadvantages of the fee system are
that it is hard to accurately depict the workload to be placed on the workers of the agency.
In addition, the customer is very skittish about involving the agency because they may
fear running up a giant bill (Guidelines, 2004 ¶ 17).
There is no one way to calculate the remuneration for an advertising agency but it
is important that the company make their decision based on the situation at hand but it is
imperative that they follow these five rules of thumb; first they must provide adequate
and accurate professional service to the customer. Second, the agency must be
adequately compensated for their work. Third, the remuneration must provide incentive
to the agency and customer. Fourth, the method of remuneration must be simple to
operate and monitor. Fifth, the method must be reviewed consistently, in case it may
need to be altered in any way (Guidelines, 2004, ¶ 28).
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Methodology and Procedure
Problem Identification
As a team, we identified our problem based on our knowledge of full service
advertising agencies, located in Cheshire County. As a team, we also spoke with Dr. Little,
and he informed us that he is only aware of a several as well. Finally, we checked online and
viewed yellow pages to confirm this observation.
Development of Survey
After multiple drafts, we reviewed our survey both with Dr. Little and our
marketing research class and made the necessary revisions. The purpose of the survey is
to determine businesses opinions, attitudes and need for another full service advertising
agency in Cheshire County. The questions were created based on the research objectives
we set forth at the beginning of our research. We felt our questions would effectively
ascertain the information we are looking to collect for our research. (See Appendix …)
Definition of Population
The population used in this research was based on businesses located in Cheshire
County. These businesses are broken down into small (1-10 employees), medium (11-50),
and large (51+). Cheshire county businesses were used because our main goal was to
determine if there is a need for a new full service advertising agency in Cheshire County.
We obtained a broken down list of businesses located within Cheshire County. This list gave
us the name, address, and phone numbers for each company. As a team, we used this list as
our sample frame to begin determining whom we would survey and in which town each team
member would be in charge of collecting data.
Sample Size
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After the total population was determined, it was decided to use an arbitrary
method to determine our sample size. Due to our lack of funds and human power, we had
chosen arbitrarily to survey 100 businesses.
Data Collection Method
The survey was divided between each of the five group members and each person
was responsible for attaining 20 completed surveys within their determined town. We used a
non-probability convenience sampling method to attain the survey total. The businesses that
agreed to take our survey where simply given the survey, and it took approximately 3
minutes to fill out. Our group surveyed at least one business in each town within Cheshire
County. Though our method of sampling was a non-probability convenience sampling
method, our team made an effort to sample at least 50% small businesses, 30% medium
businesses, and 20% large businesses. The reason we decided to use these percentages was to
assure we have a proper and accurate sample and that each business is represented
throughout our research just as it is represented in Cheshire County.
Assumptions
It is our team’s assumption that all respondents answered truthfully. We entered
professional businesses and hoped to receive truthful answers. It is also our assumption that
team surveyors have been honest in their attempt to collect random surveys. Finally, we also
feel the validity of our survey has helped meet our research objectives because the questions
we asked were based around the objectives.
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Results
Question One
With a mean of 6.81, the results of question 1 showed that 25 percent of our
respondents scaled the importance of advertising to the success of their company as a 7 (on a
scale of 1 to 10, 10 being most vital). In addition, 19 percent scaled the importance as an 8.
On the other hand, 8 percent scaled the importance as 1 (see Appendix B).
Question Two
53.7 percent of respondents stated that they would not consider using an advertising
agency. Consequently 46.7 percent of respondents would consider utilizing an advertising
agency (see Appendix C).
Question Three
Clearly in our results “marketing research” was the service most needed by business
in Cheshire County, closely followed by “web site design”. Those that are listed missing
include the businesses that did not answer correctly or did not answer at all (see Appendix
D).
Question Four
According to the results of question 4, those who answered the question correctly
were most interested in utilizing “print” (see Appendix E).
Question Five
A clear majority of the businesses surveyed utilized “internal resources” for their
advertising needs. This statistic could potentially represent new clientele for a new
advertising agency in Cheshire County (see Appendix F).
Question Six
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Those businesses that use an advertising agency, according to our results, were
overall satisfied with the agency’s performance. The mean satisfaction rating level was 7.59
(see Appendix G).
Question Seven
Out of the businesses surveyed, 41.3 percent feel that there is no need for a new
advertising agency in Cheshire County. Unfortunately, 20.0 percent of those surveyed chose
not to respond, many noting that they did not feel qualified to answer the question (see
Appendix H).
Question Eight
Out of the businesses surveyed, 61.3 percent target the general public. Only 6.7
percent target other businesses, while 32.0 percent focus on both (see Appendix I).
Question Nine
The results of question nine on the survey indicate that 49.0 percent of the businesses
are classified as “retail,” while 41.0 percent were service-based companies (see Appendix J).
Question Ten
Closely parallel to out decided methodology, 56.0 percent of respondents were
business with no more than 10 employees. Thirty-six percent of the business had a range of
11 to 50, while the remaining 8 percent over fifty employees (see Appendix K).
Cross-Tabulation One
Surprisingly, the cross-tabulation showed that 39 respondents rate the importance of
advertising to their company as a 7 or above, but only use internal resources for such
advertising (see Appendix L).
Cross-Tabulation Two
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According to the second cross-tabulation, 23 respondents who were interested in
using an agency to fulfill their advertising and marketing needs were most interested in
utilizing either print or internet. This is significant because a prospective agency might
consider focusing their services around these results (see Appendix M).
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Limitations
Sample Size
The reader should note our sample size would end up being our biggest limitation.
Due to the one semester time constraint, we were unable obtain a larger sample.
Human Power
With only five surveyors and 24 towns to cover, the surveys were taken in towns
which were most convenient for our surveyors to reach within a limited time constraint. In
addition, if larger quantity of surveyors were available more towns could have been
represented in our research.
Money
Money is considered a limitation for our research. With funding as an option we
could have developed an appropriate budget in order to hire surveyors and provide adequate
transportation.
Transportation for One Group Member
One student member did not have access to a motor vehicle in order to conduct
surveys within the designated area. In addition, the student had to conduct surveys by means
of telephone, which proved to be less productive for data collection.
Unwillingness of Businesses to Attempt/Complete Surveys Accurately
When reviewing the data we found that some businesses did not follow instructions
on the survey. For example, some questions were marked with multiple answers and some
questions were not answered at all. Corresponding with the misinterpretation of the survey,
businesses would also fail to attempt the surveys in general.
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Discussion
According to the overall results of our study, we have determined that before
opening a full-service advertising agency, a perspective entrepreneur should develop a
preemptive business plan. Results of our current research suggest that local businesses
may be more timid to consider utilizing an outside resource for advertising and marketing
needs. While completing surveys, some respondents offered interesting perspective about
the traditional business tactics of local companies. For instance, many small town
businesses only advertise in the yellow pages. They also rely heavily on word of mouth
recommendations.
We believe the success of a new full-service advertising agency would be
dependant on preliminary efforts made on behalf of the potential advertising agency.
Such efforts could include a workshop for local small business owners. This workshop
would discuss the importance of advertising and how marketing can improve profits.
Attendants would learn simple tactics while being introduced to the new agency.
State of the art technology can expand the distance between our perspective
agency and its clientele. Subsequently, the potential clients of a new agency do not have
to be limited to Cheshire County. This new perspective opens the potential of success.
Businesses within the surround area, for instance Manchester, may have interest in
utilizing a new resource for fulfilling their advertising and marketing needs. Further
clients could be pulled in over the internet.
Overall, we emphasize the need to recognize the specific interest of the
perspective client. Any new business would have to respect local culture and trends.
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While understanding that local tradition lies within word of mouth promotion, a new
agency should be prepared to respect this practice while pushing beyond it.
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Conclusion
In direct correlation between our research objectives and survey results, we have
come to the conclusion that most businesses in Cheshire County are interested in utilizing
marketing research and website design. Although we began with the suggestion of a full-
service advertising agency, we conclude that concentration should primarily be on these
two services. Besides these services, this potential advertising agency should also
specialize in different types of print media.
Unfortunately we were not able identify service deficiencies of existing ad
agencies within Cheshire County. Since our research showed that the majority of
businesses that use an advertising agency are satisfied, we should in turn focus on
businesses that do not currently use an advertising agency. The results showed that 47.6
percent of respondents would consider using an advertising agency, but only 14.7 percent
are actually; this leaves approximately one third (32.0 percent) of willing potential
clientele. From this crucial conclusion, we need to determine how many clients the
potential advertising agency would need in order to be successful.
Our final research objective was to determine the appropriate target market of the
potential advertising agency, meaning the type of business that would need the agency’s
services. The businesses that would need the services of the advertising agency were
determined by the group of respondents that are presumably interested in an advertising
agency but do not currently advertise. To go into depth further according to the results of
this survey, the concentration needs to be on small businesses in Cheshire County.
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Recommendations
In the event of further research in the future, we suggest alterations in the procedure.
Our research team found that businesses were less likely to comply over the phone than they
were in person. When attempting to contact businesses over the phone, many businesses
made excuses before considering the value of the survey. Many people were quick to dismiss
our phone calls as if we were pesky solicitors.
With approximately 1,200 businesses in Cheshire County, according to freeNH.com
(2004), 75 surveys is not an adequate sample size. We would suggest increasing the sample
size to reflect the population. Due to time and financial restrictions, we were only able to
collect 75 surveys.
Rewording the survey to indicate that respondents should “choose one” instead of
using the phrase “most interested in;” this could help to clarify the instructions. Some of the
respondents selected multiple answers although we intended for one response per question.
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References
Caudron, C. (2001). Baby boomers’ new leaf means new business strategies. Retrieved (October 15, 2004) from Http://www.businessfinancemag.com/magazine/archives-/article.html?articleid=13779&p.
Gotlieb, I. (2004). How agencies (creative & media) need to change to deal with the evolving digital landscape. Retrieved (October 14, 2004) from Http://www.- aaaa.org/transcripts/transcripts.html. Institute of Communications and Advertising. Guidelines for effective advertiser/agency remuneration. Retrieved (October 15, 2004) from Http://www.icaad.com/remuneration/sub_main.html. New Hampshire’s Free Search Engine. Retrieved (November 9, 2004) from Http://www.freenh.com. Russell, J.T. & Lane, W (2002). Kleppner’s Advertising Procedure. Upper Saddle River, NJ: Prentice Hall. Schmetterer, B. (2003). The rise of advertising. Retrieved (October 11, 2004) from Http://www.aaaa.org/transcripts/transcripts.html. Www.sbinformation.about.com. Small business trends. Retrieved (October 15, 2004) from http://sbinformation.about.com-/cs/bestpractices/a/aa122202a.htm. U.S. Census Bureau. NAICS 541810: Advertising agencies. Retrieved (October 13, 2004) from Http://www.census-.gov/epcd/ec97/def/541810.htm.
Full-Service Ad Agency 28
Appendix A
Full-Service Ad Agency 29
Appendix B
Descriptive Statistics
75 9 1 10 6.81 2.551
75
N Range Minimum Maximum Mean Std. DeviationHow important do youconsider advertisingto the success of yourcompany?
Valid N (listwise)
8%3% 3%
4%4%
9%
25%
19%
12%
13%
1 2 3 4 5 6 7 8 9 10
Full-Service Ad Agency 30
Appendix C
Statistics
Would you consider using an agency tofulfill you advertising and marketing needs?
75
0
1.53
2.00
2
.502
1
Valid
Missing
N
Mean
Median
Mode
Std. Deviation
Range
46.7
53.7
42
44
46
48
50
52
54
Yes No
Full-Service Ad Agency 31
Appendix D
Which advertising agency services would you be most interested in utilizing?
24 32.0 32.0 32.0
22 29.3 29.3 61.3
1 1.3 1.3 62.7
2 2.7 2.7 65.3
15 20.0 20.0 85.3
3 4.0 4.0 89.3
8 10.7 10.7 100.0
75 100.0 100.0
marketing research
branding
campaign development
website design
consulting
other
Total
ValidFrequency Percent Valid Percent
CumulativePercent
Marketing Research 29.3
Branding 1.3
Campaign Development 2.7
Website Design 20.0
Consulting 10.7
Other 10.7
0
5
10
15
20
25
30
Full-Service Ad Agency 32
Appendix E
What medias would you be most interested in utilizing?
20 26.7 26.7 26.7
26 34.7 34.7 61.3
9 12.0 12.0 73.3
3 4.0 4.0 77.3
9 12.0 12.0 89.3
1 1.3 1.3 90.7
7 9.3 9.3 100.0
75 100.0 100.0
radio
television
internet
oudoor advertising
other
Total
ValidFrequency Percent Valid Percent
CumulativePercent
34.7
12
12
1.3
9.3
4
0 10 20 30 40
Radio
Television
Internet
Outdoor Advertising
Other
Full-Service Ad Agency 33
Appendix F
Statistics
How do you currently advertise?73
2
2.01
2.00
2
.565
2
Valid
Missing
N
Mean
Median
Mode
Std. Deviation
Range
14.7
66.7
16
0 20 40 60 80
Outside Agency
InternalResources
Do NotAdvertise
Full-Service Ad Agency 34
Appendix G
Descriptive Statistics
17 8 2 10 7.59 2.093
17
If you do use anadvertising agency,please scale yoursatisfaction withyour agency?
Valid N (listwise)
N Range Minimum Maximum Mean Std. Deviation
1.3%
2.7%
5.3% 5.3%
4% 4%
0
1
2
3
4
5
6
1 2 3 4 5 6 7 8 9 10
Full-Service Ad Agency 35
Appendix H
Do you think there is a need for a new full-service advertising agency inCheshire County?
29 38.7 48.3 48.3
31 41.3 51.7 100.0
60 80.0 100.0
15 20.0
75 100.0
yes
no
Total
Valid
SystemMissing
Total
Frequency Percent Valid PercentCumulative
Percent
38.7 41.3
20
0
5
10
15
20
25
30
35
40
45
Yes No Missing
Full-Service Ad Agency 36
Appendix I
Statistics
Who is your target market?75
0
2.25
2.00
2
.572
2
Valid
Missing
N
Mean
Median
Mode
Std. Deviation
Range
61.3%
6.7%
32.0%
Other Businesses General Public Both, Businesses and Public
Full-Service Ad Agency 37
Appendix J
What category would your business best fit?
3 4.0 4.0 4.0
1 1.3 1.3 5.3
3 4.0 4.0 9.3
36 48.0 48.0 57.3
31 41.3 41.3 98.7
1 1.3 1.3 100.0
75 100.0 100.0
non-profit
industrial
retail
service
other
Total
ValidFrequency Percent Valid Percent
CumulativePercent
1% 4%
49%41%
1% 4%
Non-Profit Industrial Retail
Services Other Not Answered
Full-Service Ad Agency 38
Appendix K
Statistics
Identify the number of employees in your company?75
0
1.55
1.00
1
.722
3
Valid
Missing
N
Mean
Median
Mode
Std. Deviation
Range
56%36%
5% 3%
1-10 11-50 51-100 101+
Full-Service Ad Agency 39
Appendix L
Case Processing Summary
73 97.3% 2 2.7% 75 100.0%
How important do youconsider advertising tothe success of yourcompany? * How do youcurrently advertise?
N Percent N Percent N Percent
Valid Missing Total
Cases
How important do you consider advertising to the success of yourcompany? * How do you currently advertise? Crosstabulation
Count
6 6
2 2
2 2
3 3
1 1 1 3
1 5 1 7
17 17
2 11 1 14
3 6 9
4 5 1 10
11 50 12 73
1
2
3
4
5
6
7
8
9
10
How importantdo youconsideradvertising tothe success ofyour company?
Total
outsideagency
internalresources
we do notcurrentlyadvertise
How do you currently advertise?
Total
Full-Service Ad Agency 40
Appendix M
Case Processing Summary
75 100.0% 0 .0% 75 100.0%
Would you consider usingan agency to fulfill youadvertising and marketingneeds? * What mediaswould you be mostinterested in utilizing?
N Percent N Percent N Percent
Valid Missing Total
Cases
Would you consider using an agency to fulfill you advertising and marketing needs? * What medias would you be most interested in
utilizing? Crosstabulation
Count
14 5 1 9 1 5 35
12 4 2 7 15 40
26 9 3 9 1 7 20 75
yes
no
Would you considerusing an agency tofulfill you advertisingand marketing needs?
Total
print radio television internetoudoor
advertising other
What medias would you be most interested in utilizing?
Total
