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Advertising Agency

Date post: 12-Jan-2015
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Page 1: Advertising Agency
Page 2: Advertising Agency

Organization of Advertising• Purpose is to communicate effectively• Five participants of IMC process1. Advertiser (Client)2. Agency3. Media organizers4. Marketing Communications Specialists

Direct Marketing AgenciesSales Promotion AgenciesInteractive AgenciesPublic Relations Firms

5. Collateral services providers

Page 3: Advertising Agency

• One of the most important element

• Have product/services to offer

• Or some cause to market

• Is one of the final participant to decide about ad.

Page 4: Advertising Agency

• Creates /produces/ place the ads. on media

• Different types of agencies

1. Full service agency

2. Account services

3. Marketing services

4. Creative services

Page 5: Advertising Agency

• Basic Function is to provide

–Entertainment

–News

–Knowledge in such a way that it provides an environment to agency or advertisers to buy their time and place

Page 6: Advertising Agency

•are • Direct marketing agencies

• Sales promotion agencies

• Contests/sweepstakes

• Interactive firms

• Develop websites

• Public relations firms

Page 7: Advertising Agency

Services which are been provided to agencies and media organizers

Like vendors Printers etc.

Page 8: Advertising Agency

Organizational Structure of Advertising • Three types of structures each have its own adv. &

disadv.– Central system – Decentralized system

• Separate marketing, sales, advertising and promotion departments for various product lines or businesses of the company. Often use product or brand management system

– In-house system

• Selection of system depends upon – Size of the orgz.– # of products – Role of ads in the whole process – budget

Page 9: Advertising Agency

Procter & Gamble uses the brand management system

Page 10: Advertising Agency

Basic function of manager in centralized system

• Planning and budgeting

• Administration and execution

• Coordination with other departments – Like makting research dept./sales dept./materials

regarding POP.

• Coordination with out side agencies and services– Media buying services/ collateral services agencies

etc.

Page 11: Advertising Agency

• Advantages• Facilitated

communications• Fewer personnel required• Continuity in staff• Involvement of top

management/ experience is more

• Disadvantage• Some times lower level

staff can’t understand the over all mkting plan as the responsibility rests on top

• Longer response time• Inability to handle multiple

product line.

Client Organization For IMCThe Centralized System

Page 12: Advertising Agency

Decentralized system or brand mangt. system

• Advantages• More flexible in term of

promotional programs• Centralized managerial

attention• Rapid response to the

problems.

• Disadvantage• Sometimes brand

mangers are at junior level lack of experience

• Brand manger may have less authority over the execution of plan which they have created.

• Misallocation of funds.

Page 13: Advertising Agency

In-house system

Advantages

Cost saving

More control

Increased coordination

Disadvantage

Less experience

Less objectivity

Less flexible

Page 14: Advertising Agency

No Fear uses an in-house agency

Source: Courtesy No Fear.

Page 15: Advertising Agency

Role of Advertising Agency

Is a service organization that specializes in Developing Preparing and Executing the promotional programs

for its client.

Page 16: Advertising Agency

Reasons for using an outside Agency

1. U get highly professional people to work for.

2. Artists /writers /singers/media analysis are normally attached with

3. Agencies are specialized in certain areas like consumer goods etc.

4. U can get an overall image of mkt. very easily against company policies /biases/limitations or we can say it provides us an insight to the industry. an agency may have personnel who have worked in some client related industries.

Page 17: Advertising Agency

4 Types of Agencies

1. Full service agency• Involved in planning/creative

/producing/research/media selection and also in some non advertising services like

– Strategic mkting planning– Sales promotions– Sales training– Trade shows– Package design– Public relations programs – Publicity

Page 18: Advertising Agency

Typical Full-Service Agency Organization

WritersArt Directors

Traffic

TVProduciton

Traffic

PrintProduction

VP CreativeServices

AccountExecutive

AccountSupervision

VP AccountServices

Media Research SalesPromotion

VP MarketingServices

Personnel Accounting Finance

OfficeManagement

VP Managementand Finance

President

Board ofDirectors

Page 19: Advertising Agency

2.Account services

• Account management is to provide a link b/w client and agencies

• Normally a very experienced and professional person of marketing is involved in such type of arrangement.

Page 20: Advertising Agency

3.Marketing services

• Have :• Research departments

– Who is the target audiences– Who is the ultimate consumers – Trends of industries – Consumers habits etc – Segment analysis etc.

• Media departments• Must have media profiles

Page 21: Advertising Agency

4.Creative services

• Responsible for creating and executing ads.• Copy writers: r the personnel who

write ,headlines/subhead lines/body copy. May be involved in basic theme or the big selling idea of the promotional campaigns.

• May have diff. departments – Art department

• Prepare story board for TV

– Production dept.– Traffic dept.

Page 22: Advertising Agency

Some more types of services

• Creative boutiques

– Provides only creative services. e.g. supreme with Shoaib Mansoor

• Media Buying Services– Some people only buy space in media and

sell to others

Page 23: Advertising Agency

Agency Compensation • Diff. Forms of compensation• Commission from media

– 15% from media

• Fixed fee method • Fee-commission combination• Cost plus agreement

– Fee basis on the cost of its work

• Pay actual cost+profit margin• Incentive based • % charges normally 20-25 % when sub let or

purchase services from others.

Page 24: Advertising Agency

Example of the Commission System

Page 25: Advertising Agency

Why Agencies Lose Clients Poor performance Poor communication Unrealistic demands Personality conflicts Personnel changes Changes in size Conflict of interests Changes in strategy Declining sales Payment conflicts Policy changes

Page 26: Advertising Agency

How Agencies Gain Clients

Referrals• Solicitations

– Making calls and following them• Presentation

– People ask agency to come and present itself.

Presentations

Public Relations

Image and Reputation

Page 27: Advertising Agency

Awards competitions are a way for agencies to build their reputation

Page 28: Advertising Agency

A promotional agency advertises its services


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