advertising agencies

1. advertising agencies

2. structure & organization what agencies do. and how they’re organized to do it.

3. 7 primary services: • complete a marketing analysis • develop an advertising plan • prepare a creative strategy • create advertising executions • develop and implement a media plan • handle billing and payments • integrate other marketing communications

4. 4 functions of full-service agencies • account management • creative • media planning and placement • research

5. agency organization chart

6. account management • liaison between agency and client • responsible for understanding... • the client’s business • the client’s marketing needs • strategy development • representing client point of view within the agency

7. account management • account management director • management supervisor • account supervisors • account executives • assistant account execs • account coordinators • traffic

8. creative department • responsibility • the creative department is responsible for creating and producing the print and broadcast advertising • strategy is key • good creative work is always guided by a creative strategy that sets forth goals to be accomplished and key message points to be relayed

9. creative department • executive & group creative directors • creative director • associate creative director • copywriters • art directors • broadcast producers • print production managers • traffic coordinators

10. media department • The media department has two main functions - planning and buying. • The planning group handles more strategic marketing and media issues. • The buying group handles media negotiations and implementation.

11. media department • media director • associate media directors • media supervisors • media planners • media buyers • media analysts Media Plan

12. big changes in the media department • mega-agency media departments have now becomeprofit centers • agencies have set up their media departments asfree-standing units • many large clients now look at media as aseparate service

13. research department • interpret market environment • gather and analyze research data. • primary and secondary techniques • determine consumer needs/perceptions • understand problems • advise how ads can meet strategic goals • help find solutions Research Report

14. research department • research director • research project managers • research assistants • outside research specialists Research Report

15. auxiliary agency functions • account planning • strategy/creative review board • office management • human resources • legal services • accounting • recruitment

16. 3 ways agencies make money • commissions • usually 15% of gross costs • fees • usually based on negotiated hourly rate • incentives • still relatively new and problematic • usually based on performance goals

17. agency commissions • media commission system • 15% media commission • adjustable commission rates • negotiate to match client budget • sliding scale • markups-production & service • add a percentage markup to costs • 17.65% of net = 15% of gross

18. 4 types of fee systems • fixed fee (retainer) • cost-plus fee • performance fee • hybrid fee & commission

19. incentives • in theory, a good way to work • get paid based on how well you do, not how much you bill • in practice, difficult to implement • if client makes final decision (instead of agency), how can agency be responsible for final results? • results based on many factors, such as competitive efforts, not just advertising

20. new business • three primary sources • build existing client’s business • add and sell new IMC services • solicit new accounts • two ongoing problems • “spec” work • teams “walking” with accounts “The critical objective and role of any ad agency is gaining new business.”

21. things to think about: • why might you be interested in going into the agency business? • what might keep you from choosing a career in the agency business?