Agency Structure of Advertising Agency

Broadly there are 6 departments in any advertising agency

 Account Servicing
 Account Planning
 Media
 Creative
 Production
 Finance and Accounting

Account service department

The account service, or the account management department, is the link between the ad agency and its clients.
Depending upon the size of the account and its advertising budget one or two account executives serve as
liason to the client. The account executive’s job requires high degree of diplomacy and tact as
misunderstanding may lead to loss of an account. The account executive is mainly responsible to gain
knowledge about the client’s business, profit goals, marketing problems and advertising objectives.

The account executive is responsible for getting approved the media schedules, budgets and rough ads or
story boards from the client. The next task is to make sure that the agency personnel produce the advertising to
the client’s satisfaction. The biggest role of the account executive is keeping the agency ahead of the client
through follow-up and communications.

Media department

The responsibility of the agency’s media department is to develop a media plan to reach the target audience
effectively in a cost effective manner. The staff analyses, selects and contracts for media time or space that will
be used to deliver the ad message. This is one of the most important decisions since a significantly large part
of the client’s money is spent on the media time and/or space. The media department has acquired increasing
importance in an agency’s business as large advertisers seem to be more inclined to consolidate media buying
with one or few agencies thereby saving money and improving media efficiency.

Creative department

To a large extent, the success of an ad agency depends upon the creative department responsible for the
creation and execution of the advertisements. The creative specialists are known as copywriters. They are the
ones who conceive ideas for the ads and write the headlines, subheads and the body copy. They are also
involved in deciding the basic theme ofthe advertising campaign, and often they do prepare the rough layout of
the print ad or the commercial story board.

Creation of an ad is the responsibility of the copywriters and the art department decides how the ad should
look.

Production department

After the completion and approval of the copy and the illustrations the ad is sent to the production department.
Generally agencies do not actually produce the finished ads; instead they hire printers, photographers,
engravers, typographers and others to complete the finished ad. For the production of the approved TV
commercial, the production department may supervise the casting of actors to appear in the ad, the setting for
 scenes and selecting an independent production studio. The production department sometimes hires an
outside director to transform the creative concept to a commercial.

Finance and accounting department

An advertising agency is in the business of providing services and must be managed that way. Thus, it has to
perform various functions such as accounting, finance, human resources etc. it must also attempt to generate
new business. Also this department is important since bulk of the agency’s income approx. 65% goes as salary
and benefits to the employees.

How Traditional Advertising is different from Internet

Advertising
The following table shows how Traditional Advertising is different from Internet Advertising

TRADITIONAL ADV. (TA) INTERNET ADV. (IA)

TA is static. It is dynamic with multimedia-

supporting text and graphics video
sound all together.

Space is not a restricting factor Space is a problem, as regards

size of the banners etc.

The proportion of advertising to A web page would be 91%

editorial is high sometimes 50:50. editorial and 9% advertising.

Does not evoke immediate action. Invokes immediate action as you

at-least need to click on the ad.

Response to the action is not First response is immediate as

immediate. when the user clicks, the person is
directed to other web page
withmore details.

dvertisements are passively The user has high attention level

received. and concentration while using the
net, and hence they notice the ad.
(please refer the chapter)

Advertising does not always This can be very focused.

target a very focused audience.

Advertisements are ubiquitous. Advertisements catch users when

they are on the lookout for some
thing. For example the search is
for travel on a search engine there
are ads of travel agents on the
 net.

Difficult to track the This is quite possible with Internet

exact numberof people who saw advertisements.
the advertisement.

Ads are graphic intensive and Both copy and graphics are
avoid copy overload. restricted by the banner size
specifications.

The costs would be prohibitive to There are no such constraints

reach a global audience.

Communication Objective in Advertising

A mediocre advertising message properly directed stands more chance of success than the most professionally
developed ad campaign directed at the wrong audience or using unsuitable message appeals.

Advertising creates its most powerful impact when it is used to solve narrowly defined
communication objectives.

Advertising communication objectives can be put in a pyramid form. The lower level objectivesare awareness,
knowledge or comprehension. These are accomplished first. Subsequentobjectives may focus on moving
prospects to higher levels in the pyramid to elicit desired behavioral responses such as associating feelings
with the brand, trial or regular use etc. It is easier to accomplish objectives located at the base of the
pyramid than the ones toward the top. The percentage of prospective customers will decline as they move
up the pyramid towards more action oriented objectives, such as regular brand use, etc.

Irrespective of the fact whether the brand is new or established, the pyramid can be used to determine
appropriate advertising objectives. What is required is to determine where the target audience lies
with respect to various levels in the pyramid. If the level of brand awareness or knowledge of its features or
benefits is low, the advertising communication should be to increase them. In case the brand liking and
preference is low, then the appropriate goal can be to change the target audience’s image of the brand.

Developing an Integrated marketing Communication Plan -

IMC
The process of developing an integrated marketing communications plan

REVIEW OF THE MARKETING PLAN

 Examine the overall marketing plan and objectives

 Role of Advertising and Promotions
 Competitive analysis
 Assess environmental influences
ANALYSIS OF PROMOTIONAL PROGRAM SITUATION

Internal analysis

 Promotional department organization

 Firm’s ability to implement a promotional program
 Agency evaluation and selection
 Review of previous program results

External analysis

 Consumer behavior analysis

 Market segmentation and target marketing
 Market positioning

ANALYSIS OF THE COMMUNICATION PROCESS

1.BUDGET DETERMINATION

 Set tentative marketing communication budgets.

 Allocate tentative budget

2.DEVELOP IMC PROGRAM

1. Advertising

 Set advertising objectives

 Determine advertising budget
 Develop advertising message
 Develop advertising media strategy

2. Direct marketing

 Set direct marketing objectives

 Determine direct marketing budget
 Develop direct marketing message
 Develop direct marketing strategy

3. Interactive/Internet marketing

 Set Interactive/Internet marketing objectives

 Determine Interactive/Internet marketing budget
 Develop Interactive/Internet marketing message
 Develop Interactive/Internet marketing media strategy

4. Sales Promotion

 Set Sales Promotion objectives

 Determine Sales Promotion budget
 Develop Sales Promotion message
  Develop Sales Promotion media strategy

5. Public Relations/Publicity

 Set Public Relations/Publicity objectives

 Determine Public Relations/Publicity budget
 Develop Public Relations/Publicity message
 Develop Public Relations/Publicity media strategy

6. Personal Selling/Sales

 Set Personal Selling/Sales objectives

 Determine Personal Selling/Sales budget
 Develop Sales message
 Develop selling roles and responsibilities

Four Types of Advertising Agencies

Here are basically four types of ad agencies. They are:

 In-house agencies

 Creative boutiques

 Media buying agencies

 Full service agencies

In- house agencies

Some companies, in an effort to reduce costs and maintain greater control over agency activities, have set up
their own advertising agencies internally. An in-house agency is an ad agency set up, owned and operated by
the advertiser. Many companies use in-house agencies exclusively; others combine in-house efforts with those
of outside agencies.

A major reason for using in-house agency is to reduce advertising and promotional costs. Companies with very
large advertising budgets pay a substantial amount to outside agencies in the form of media commissions. With
an internal structure, these commissions go to the in-house ad agency. An in-house ad agency can also
provide related work such as sales presentations and sales force material, package design, and public relations
at a lower cost than the outside agencies.

Saving money is not the only reason companies use in-house ad agencies. Time savings, bad experience with
outside agencies, and the increased knowledge and understanding of the market that come from working
advertising and promotion for the product or service day by day are also reasons. Companies can also
maintain a tighter control over the process and more easily coordinate promotions with the firm’s overall
marketing programmes.

Opponents of the in-house agencies say that they can give the advertiser neither the experience nor the
objectivity of the outside agency and nor the range of services. They argue that the outside agencies have a
more specialized staff and attract the best creative staff. Also flexibility is higher since if the company is not
satisfied with the agency it can be dismissed, whereas changes in an in-house agency could be slower and
more disruptive.

Thus we can summarize by saying that

Ad agency Advantages Disadvantages

In house Cost saving Less experience

agency
More control Less objectivity

Increased coordination Less flexibility

In-house agencies in India are:

 Levers - Lintas (previously)

 Videocon – Confidence
 Reliance – Mudra (when Mudra started out)

Creative boutiques
Creative boutique is an agency that provides only creative services. These specialized companies have
developed in response to some client’s desires to use only the creative talent of an outside provider while
maintaining the other functions internally.

The client may seek outside creative talent for two reasons:

 Because he wants an extra creative effort

 May be because its own employees of the in-house agency or the agency that he has appointed do
not have sufficient skills in this regard.

The full-service agencies also sub-contract work creative boutiques when they are very busy or want to avoid
adding full time employees to their pay roll. Creative boutiques are usually found by members of
the creative departments of full service agencies who leave the firm and take with them clients who want to
retain their creative talents. These boutiques generally performcreative function on a fee basis.

Few creative boutiques in India:

 RMG David
  Vyas Gianetti Creatives
 Chlorophyll

Media buying agencies

Media buying agencies are independent companies that specialize in the buying of media, particularly radio
and television. The task of purchasing advertising media has grown more complex as specialized media
proliferate, so media buying services have found a niche by specializing in the analysis and purchase of the
advertising time and space. Agencies and clients generally develop their own media plans and then hire the
buying services to execute them.

Some media buying agencies do help advertisers plan their media strategies. Because media buying
agencies purchase such large amounts of time and space, they receive large discounts and can save the small
ageny’s or client’s money on media buying. Media buying agencies are paid a fee or commission for their work.

 Mindshare
 Initiative Media (LOWE)
 Zenith Media (Bates, Saatchi & Saatchi)
 Optimedia (Publicis)
 Starcom (Leo Burnett)
 Fulcrum (HTA) Normal 0 MicrosoftInternetExplorer4

Full – service agency

The function of an advertising agency is to see to it that its client’s advertising leads to greater profits in the
long run than could be achieved without the ad agency. Most such agencies are large in size and offer their
clients a full range of services in the area of marketing, communications and promotions. These include
planning, creating and producing the advertisement, media selection and research. Other services offered
include strategicmarketing planning, sales training, package design, sales promotion, event management, trade
shows, publicity and public relations.

The full service agency is composed of various departments; each is responsible to provide required inputs to
perform various functions to serve the client.
What are Advertising Agencies?
Advertising agencies are outside companies that provide for the marketing and advertising
needs of other businesses and organizations. Advertising agencies offer a full range
ofadvertising services and advice based on market studies, popular culture and advanced sales
techniques. Because they are independent from the client company, they can be objective
about a client's promotional needs.

Advertising agencies produce logos, creating effective and attractive color schemes to draw the
consumer's attention to their clients' ads. They also prepare slogans and brochures, and write
descriptive copy for sales materials. They may produce public service announcements for
charitable organizations and social programs as well, and issue press releases for new
programs, events, and products. Advertising agencies use assorted forms of media to promote
their clients' businesses or organizations, including magazine advertisements, newspaper ads,
radio and TV commercials, websites, and even infomercials. Some also plan events, provide
booths at conventions, and give away promotional items.

The way advertising agencies work is by getting to know their clients' product or service well
and determining which demographic provides the best audience for promotion. If a company
sells designer handbags, an ad agency would likely try to position the company's TV
commercials during women's programming or on a channel geared toward women. The look
and tone of an ad campaign is also dependent upon demographics. If the company's target
audience is mature adults, design elements should be more traditional than if the target were a
younger generation.

How does an advertising agency work?

Advertising is the most effective way to reach consumers and create awareness about your
products and services. With thousands of companies coming up every day to offer their
products and services, advertising becomes a highly integral tool to reach your products
effectively to the consumer. An advertising agency has an upheaval task of informing,
persuading and building a relationship of trust and faith between the company and his
consumers. Thus advertising agency is an instrument where advertisements are conceived,
strategized, planned to reach maximum people. Webwindows, a UK based leading media
agency has been rendering advisory and creative services to online companies to assist them in
their needs for planning, composing advertisements and placing them in the right newspaper for
the last ten years. In fact, Webwindows has a dedicated page, the Webwindows page that
appears in the seven leading papers in the UK. The Webwindows page is completely dedicated
to small and mid-sized companies to promote their online offerings. Research has proved what
Webwindows has believed all along that when it comes to advertising print prevails over the
Internet and all other forms of media. By advertising Webwindows, you not only gain
advertising space at cost-effective rates but also the fruits of the ten years of experience
Webwindows has in guiding its client to advertise in the right newspaper based on
demographics, customer reach, target audience etc.
The crux of the adverting job is to help you reach your services / products to the public in the
best possible way. Advertising agencies have to build strategies that build a stand-out image of
your company among your consumers. They need to build a relationship of trust and faith
between your products / services and the prospective consumers. Following the same
fundamental to reach your product to the consumers in a positive light, Webwindows assist
online companies in 360 degree aspects of advertising. Right from ad content composition to
design to placement, they formulate the best media strategies to help you reach a wide
consumer base.

Here are a few tips from Webwindows on choosing the right advertising agency.

Understand your product and business goals: The first task of any advertising agency is to
well-develop a thorough understanding of your product, its prospective position in the market
place and its target audience. This helps advertisers to produce effective advertising campaigns
to best publicize your product. Webwindows carefully studies your products and then guides you
about the marketing strategy, which paper the ad should be placed, how many times it should
run etc.

Create Advertising campaigns: Keeping the client’s goals in mind, the advertising agency
should be able to build advertising campaigns, like slogans, jingles, et al. The campaign is built
with the aim to push the sales of the company’s products, attract new consumer belt while
retaining the old ones, re-affirm the brand image, market the product and generate brand
awareness if the brand has been just forayed into the market.

Advertise the product: After the campaign is ready, the advertiser looks for media vehicles to
popularize / publicize the product. The campaign may be advertised in a range of media
agencies like, television, radio, print, depending on the client’s budget. For your advertising
needs, Webwindows chooses newspaper as the premium mode of advertisement. Through its
dedicated page, The Webwindows page, which appears as a colored supplement in seven
leading newspapers and magazines in UK, it reaches its clients’ services to a large readership
of around 5 million viewers. Webwindows also assists you in choosing the right newspaper to
help you market your product so that it reaches maximum viewers in the most effective way.

The primary aim of any advertising agency is to analyze your goals and help you aspire for
more results. Through their well-planned and result-oriented advertising strategies,
Webwindows helps you reach the right audience at the right time highlighting the right message.