ad agency

1. atulravish@gmail.comatulravish@gmail.com

2. what is it ??what is it ??
Ad Agency is a service organised whichAd Agency is a service organised which
provides specialized services in the field ofprovides specialized services in the field of
advertising. It:advertising. It:
PlansPlans
DesignsDesigns
Executes,andExecutes,and
PromtesPromtes
the ad campaingns in return of [mainly]:the ad campaingns in return of [mainly]:
Fee by clientsFee by clients
Commission by ad vehiclesCommission by ad vehicles

3. the first advertising agentsthe first advertising agents
s 1843 volney palmer1843 volney palmer
q agent foragent for mediamedia, not advertisers, not advertisers
s 1864 - george p. rowell1864 - george p. rowell
q ““the johnny appleseedthe johnny appleseed
of advertising”of advertising”
q Rowell’s AmericanRowell’s American
Newspaper DirectoryNewspaper Directory
q space wholesalerspace wholesaler
q shared his “secret”shared his “secret”
q 1888 -1888 - “Printer’s Ink”“Printer’s Ink”

4. q founded in 1864 byfounded in 1864 by
francis w. ayer, 20francis w. ayer, 20
the first advertising agencythe first advertising agency
q ““& son” made the& son” made the
business seem morebusiness seem more
establishedestablished
q worked forworked for advertiseradvertiser
q slogan -slogan - “keeping“keeping
everlastingly at iteverlastingly at it
brings success.”brings success.”
s n.w. ayern.w. ayer & son& son

5. major types of agency:major types of agency:
s mega-agency groupsmega-agency groups
s independent agenciesindependent agencies
q national, regional, and localnational, regional, and local
s specialized/niche agenciesspecialized/niche agencies
s agency service suppliersagency service suppliers
q media buying, creative servicesmedia buying, creative services

6. mega-agency groupsmega-agency groups
s prompted by mergers andprompted by mergers and
client globalizationclient globalization
s financial pressuresfinancial pressures
martin sorrell,
chairman WPP
s service multinationalservice multinational
accountsaccounts
s subsidiaries providesubsidiaries provide
“IMC” (integrated marketing“IMC” (integrated marketing
communication) servicescommunication) services

7. mega-agency pros & consmega-agency pros & cons
positives:positives:
s larger talent poollarger talent pool
s negotiating cloutnegotiating clout
s financial rewardsfinancial rewards
s account securityaccount security
s competitive edgecompetitive edge
s strong partnershipsstrong partnerships
s more servicesmore services
s international linkinternational link
negatives:negatives:
s people vs. profitpeople vs. profit
s creativity vs. sizecreativity vs. size
s conflict ofconflict of
interestsinterests
s people businesspeople business

8. national, regional & localnational, regional & local
s these arethese are independent agenciesindependent agencies
s there are nowthere are now fewer nationalfewer national
agenciesagencies which are not part ofwhich are not part of
mega-agency groupsmega-agency groups
s regionalregional andand local agencieslocal agencies workwork
with smaller clients who are usuallywith smaller clients who are usually
located nearbylocated nearby

9. specialized/niche agenciesspecialized/niche agencies
s industry specialistsindustry specialists
s ethnic agenciesethnic agencies

10. specialized/niche agenciesspecialized/niche agencies
s industry specialistsindustry specialists
s ethnic agenciesethnic agencies
s internet agenciesinternet agencies

11. specialized/niche agenciesspecialized/niche agencies
s industry specialistsindustry specialists
s ethnic agenciesethnic agencies
s internet agenciesinternet agencies
s business-to-business agenciesbusiness-to-business agencies
s creative boutiques andcreative boutiques and
design housesdesign houses

12. other suppliersother suppliers
s provide “unbundled” servicesprovide “unbundled” services
q one part of what an agency doesone part of what an agency does
s media buying servicesmedia buying services
s freelancers & consultantsfreelancers & consultants
s production companiesproduction companies
s in-house or “house” agenciesin-house or “house” agencies
q agencies owned by clientsagencies owned by clients

13. primary roles of agenciesprimary roles of agencies
s idea generationidea generation
s brand-buildingbrand-building

14. primary services:primary services:
s complete acomplete a marketing analysismarketing analysis
s develop andevelop an advertising planadvertising plan
s prepare aprepare a creative strategycreative strategy
s createcreate advertising executionsadvertising executions
s develop and implement adevelop and implement a media planmedia plan
s handlehandle billingbilling andand paymentspayments
s integrateintegrate other marketingother marketing
communicationscommunications

15. integrated marketing communicationintegrated marketing communication
s““done right,done right, IMCIMC is theis the
planningplanning andand
implementationimplementation
of theof the variousvarious
communicationscommunications
disciplinesdisciplines as aas a
single, overallsingle, overall
communicationscommunications
system --system -- making allmaking all
the channels work.”the channels work.”

16. integrated marketing communicationintegrated marketing communication
s advertisingadvertising
s public relationspublic relations
s direct responsedirect response
s sales promotionsales promotion
s personal sellingpersonal selling
the imc promotion mixthe imc promotion mix

17. ad agency departmentalization
sFollowing are the types of
department in a normalized ad
agency:
qAccounts management
qCreative management
qMedia department
qResearch department

18. s liaison between agency and clientliaison between agency and client
s responsible for understanding...responsible for understanding...
q the client’s businessthe client’s business
q the client’s marketing needsthe client’s marketing needs
q strategy developmentstrategy development
s representing client point of viewrepresenting client point of view
within the agencywithin the agency
account managementaccount management

19. s account managementaccount management
directordirector
s management supervisormanagement supervisor
s account supervisorsaccount supervisors
s account executivesaccount executives
s assistant account execsassistant account execs
s account coordinatorsaccount coordinators
s traffictraffic
account managementaccount management

20. s responsibilityresponsibility
q the creative departmentthe creative department is responsibleis responsible
for creating and producing the print andfor creating and producing the print and
broadcast advertisingbroadcast advertising
s strategy is keystrategy is key
q good creative workgood creative work is always guided by ais always guided by a
creative strategycreative strategy that sets forththat sets forth goals togoals to
be accomplishedbe accomplished andand key messagekey message
pointspoints to be relayedto be relayed
creative departmentcreative department

21. creative departmentcreative department
s executive & group creativeexecutive & group creative
directorsdirectors
s creative directorcreative director
s associate creative directorassociate creative director
s copywriterscopywriters
s art directorsart directors
s broadcast producersbroadcast producers
s print production managersprint production managers
s traffic coordinatorstraffic coordinators

22. media departmentmedia department
s TheThe media departmentmedia department has two mainhas two main
functions -functions - planningplanning andand buying.buying.
s The planning groupThe planning group handles morehandles more
strategic marketing and media issues.strategic marketing and media issues.
s The buying groupThe buying group handles mediahandles media
negotiations and implementation.negotiations and implementation.

23. s media directormedia director
s associate media directorsassociate media directors
s media supervisorsmedia supervisors
s media plannersmedia planners
s media buyersmedia buyers
s media analystsmedia analysts
media departmentmedia department

24. s mega-agency media departmentsmega-agency media departments
have now becomehave now become profit centersprofit centers
s agencies have set up their mediaagencies have set up their media
departments asdepartments as free-standing unitsfree-standing units
s many large clients now look at mediamany large clients now look at media
as aas a separate serviceseparate service
big changes in thebig changes in the
media departmentmedia department

25. research departmentresearch department
s interpret market environmentinterpret market environment
q gather and analyze research data.gather and analyze research data.
q primary and secondary techniquesprimary and secondary techniques
s determine consumer needs/perceptionsdetermine consumer needs/perceptions
q understand problemsunderstand problems
s advise how ads can meetadvise how ads can meet
strategic goalsstrategic goals
q help find solutionshelp find solutions

26. s research directorresearch director
s research project managersresearch project managers
s research assistantsresearch assistants
s outside researchoutside research
specialistsspecialists
research departmentresearch department

27. auxiliary agency functionsauxiliary agency functions
s account planningaccount planning
s strategy/creative review boardstrategy/creative review board
s office managementoffice management
q human resourceshuman resources
q legal serviceslegal services
q accountingaccounting
q recruitmentrecruitment

28. ways agencies make moneyways agencies make money
s commissionscommissions
q usually 15% of gross costsusually 15% of gross costs
s feesfees
q usually based on negotiated hourly rateusually based on negotiated hourly rate
s incentivesincentives
q still relatively new and problematicstill relatively new and problematic
q usually based on performance goalsusually based on performance goals

29. agency commissionsagency commissions
s media commission systemmedia commission system
q 15% media commission15% media commission
s adjustable commission ratesadjustable commission rates
q negotiate to match client budgetnegotiate to match client budget
q sliding scalesliding scale
s markups-production & servicemarkups-production & service
q add a percentage markup to costsadd a percentage markup to costs
q 17.65% of net = 15% of gross17.65% of net = 15% of gross

30. types of fee systemstypes of fee systems
s fixed fee (retainer)fixed fee (retainer)
s cost-plus feecost-plus fee
s performance feeperformance fee
s hybrid fee &hybrid fee &
commissioncommission

31. incentivesincentives
s in theory, a good way to workin theory, a good way to work
s get paid based on how well you do, notget paid based on how well you do, not
how much you billhow much you bill
s in practice, difficult to implementin practice, difficult to implement
s if client makes final decision (instead ofif client makes final decision (instead of
agency), how can agency be responsibleagency), how can agency be responsible
for final results?for final results?
s results based on many factors, such asresults based on many factors, such as
competitive efforts, not just advertisingcompetitive efforts, not just advertising

32. new businessnew business
s three primary sourcesthree primary sources
q build existing client’s businessbuild existing client’s business
q add and sell new IMC servicesadd and sell new IMC services
q solicit new accountssolicit new accounts
s two ongoing problemstwo ongoing problems
q ““spec” workspec” work
q teams “walking” with accountsteams “walking” with accounts
““The critical objective and roleThe critical objective and role
of any ad agency is gaining newof any ad agency is gaining new
business.”business.”

33. beyond 2K10”beyond 2K10”
advertisingadvertising
agency trendsagency trends

34. agency trendsagency trends
sclutter, overloadclutter, overload,, “overchoice”“overchoice”
q increasedincreased media optionsmedia options
q increasingincreasing audience fragmentationaudience fragmentation
q more messagesmore messages everywhereeverywhere
s doing more with lessdoing more with less
q economic pressures,economic pressures, “downsizing”“downsizing”
q ongoingongoing client budget pressuresclient budget pressures
s managing sizemanaging size
q moremore mergersmergers andand mega-agenciesmega-agencies

35. agency trendsagency trends
s managingmanaging technologytechnology
q interactive marketinginteractive marketing
q e-mail, web sitese-mail, web sites
s improvingimproving internal systemsinternal systems
q account planningaccount planning
q re-engineeringre-engineering agency organizationagency organization
q improving delivery ofimproving delivery of imc servicesimc services

36. as long as marketers needas long as marketers need
ideasideas to build theirto build their brands,brands,
they’re going to needthey’re going to need
in conclusion...in conclusion...
advertising agenciesadvertising agencies

37. thanxthanx
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