Advertising Agencies

INSTRUCTORDR.M.P.SINGH
PROGRAM DIRECTOR
&
PROFESSOR-MARKETING 1
EXH 2-24

2
 Ad Agencies: Combining
Marketing and Advertising
Giving Product a
Personality
Ad Agency
Add
Setting Product Communicating
Perceived
Apart from Basic
Value to Information
Competition Product of
Client by:

Creating Image of
Product 3
How Agencies are Organized
Account
Management
Internal
Service 5 Areas
of Creative
Development
Account Importan & Production
Planning ce
& Media
Research Planning &
Buying

* Departmental system vs. Group system

4
 Agency Department System
President

Vice President Vice President Vice President Vice President

Account Creative Marketing Management
Services Services Services Services

Account Account Accountin

Art / Copy Media
Supervisor Supervisor g

Account Productio Purchasin

Research
Executive n g

Account
Personnel
Executive

5
 Agency Group System
Agency
Management

Group 1 Group 2 Group 3

Management Management Management
Director Director Director

Account Creative Media Market

Service Director Planning Research

6
EXH 2-20

7
 Why Agencies Lose Clients
• Poor performance or service
• Poor communication
• Unrealistic demands by client
• Personality conflicts
• Personnel changes
• Changes in size of client or agency
• Conflicts of interest
8
Perceptions of Involvement:
Who Set Strategy?

9
Perceptions: What Is the
Agency’s Role?

10
How Clients Compensate Agencies

Commissions

Fees Combination

1982 1997 11
 Trends in Methods of Agency Compensation (in
percentages)

SOURCE: Data from the Association of National Advertisers.

12
 10 Principles for Building a Better
Relationship with Your Agency
• Inculcate a spirit of partnership.
• Be wary of change for change’s sake.
• Make sure your agency is making a fair profit
on your account.
• Make the agency totally absorbed in the
company’s product, the people, and the
corporate culture.
• Create an environment of experimentation
and be prepared to pay for failure.
13
10 Principles for Building a Better
Relationship with Your Agency
• Treat the agency people well.
• Agree on a clearly defined obj. for adv.
• Keep approvals simple, disapprovals kind.
• Make the agency responsible for the
advertising and give it the authority it needs to
be responsible.
• Give the agency a formal evaluation every
year.

14
Thanks

15