Advertising Agencies

Presented By: Prakhar Kumar Pandey Roll No. 16

Definition
An organization that provides a variety of advertising related services to clients seeking assistance in their advertising activities. - American Marketing Association
Full-service advertising agency engages in the planning and administration of advertising campaigns, including setting advertising objectives, developing advertising strategies, developing and producing the advertising messages, developing and executing media plans, and coordinating related activities such as sales promotion and public relations. Limited-service advertising agency concentrates on one of the major advertising agency functions such as developing and producing advertising messages or media plans.

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 communication

Functions
Account management Creative Media planning and placement Research

Organisational Structure
Board o f Direct ors [Cha irm an/CEO] Pre sident [COO]

Other Mark e ting Com munica tions Services [PR, e tc. ]

St rate gy Review Bo ard [Mana gme nt Com mitt ee]

Off ice Manag eme nt [Perso nnel, Acco unting, Lega l, et c. ]

Acco unt Mg mt . Direct or

Crea tive Exec CD

Rese arch Direct or

Media Dept. Direct or

Manage ment Supe rvisor

Asso ciate Crea tive Direct or

Pro ject Manage rs

Asso ciate Media Direct or

Acco unt Executive

Crea tive Group:

Rese arch Assist ants

Media Supe rvisor

Asst . Acco unt Executive

Copy Spvr. & Copywrit ers

Art Supervisor & Art Directors

Media Planner

Media Buyer

Broa dcas t Pro duct ion

Print Pro duct ion

Analyst s

Tra ffic

Account Management
Responsible for understanding... the clients business the clients marketing needs strategy development Representing client point of view within the agency

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

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.

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.

Auxiliary agency functions

Account planning Strategy/creative review board Office management Human resources Legal services Accounting Recruitment

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

Agency Commission
Media commission system 15% media commission Adjustable commission rates Negotiate to match client budget Markups-production & service Add a percentage markup to costs 17.65% of net = 15% of gross

Types of fees
Fixed fee (retainer) Cost-plus fee Performance fee Commission

Incentives
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

Thank You!