The Advertising Agency
• The Agency World :The traditional agency New agency structures The growing range of specialists Selecting an agency Paying the agency
Understand the role of advertising agencies and the relationship between agency and client Appreciate the factors that promote creative and effective advertising
• The agency world Objectives:-
• Alternative ways to perform the advertising function - Inhouse advertising operation
Necessitates employing an advertising staff and absorbing the operation costs Unprofitable unless a company does a large and continuous advertising 2. ADVANTAGE AND DISADVANTAGE OF ADVERTISING AGENCY
In-depth knowledge and skills Obtaining negotiating muscle with the media Coordinating advertising and marketing efforts Use services only when they are needed Availability of high-caliber creative talent Potential cost efficiencies
Some control is lost Larger clients are favored over small clients Occasionally inefficient in media buying Specialists approach client problems in a stereotyped fashion Lack of cost accountability Financial instability of smaller boutiques
• Advertising Agency Organization
Creative Services: Develop advertising copy and campaigns Copywriters, production people, and creative directors Media Services Selecting the best advertising media Media planners develop overall media strategy Media buyers procure the selected media
Research Services
Study clients’ customers’ buying habits, purchase preferences, and responsiveness Focus groups, mall intercepts, acquisition of syndicated research data Account Management Link the agency with the client Act as liaisons so that the client does not need to interact directly with several different service departments and specialists
• What Makes Effective Advertising?
Sound Strategy Consumer’s View Persuasive Break Clutter Deliver on Promises Doesn’t Overwhelm
• Creating Effective Advertising
Characteristics of creative campaigns Differentiates itself Out-if-the-ordinary Energizer Batteries – Energizer Batteries keep going, and going, and going… Like the drum-beating bunny that reinforces the argument Pepsi-Cola Pepsi-Cola commercial pokes fun at its competitor,Coca-cola and subtly conveys the message that perhaps Pepsi is better than Coke Volkswagen Golf This simple ad dramatizes that the Volkswagen Golf is a roomy car while holding the viewer’s attention in an entertaining manner
New agency structures
Three factors that influence the ways in which new agency formats have emerged Technological changes Growing importance of internationally held accounts for large agencies Recognition that different clients have diversified needs
Reorganizing the old
The ‘account room’ approach Structure the agency around its clients - creates a focus for the account team keeps them close to the brand
The “Virtual Account Group” or “Virtual agency” Uses linked computers Intranet Video conferencing High tech connections “hot desking” First come first served offices
Results of reorganization
Gets agencies away from what they always criticized in their clients. focus on products and production with less regard to customers needs Allows for anyone on the team to be involved in the creative process
Specialist Agencies
Media Buying agencies
Buy blocks of space or time from media business Effectively became media wholesalers An important source of advertising research
Creative Boutiques
Creative hot-shops Using briefs from clients – create advertisements Often freelancers Assist full service agencies when under pressure
Direct Marketing Nowadays full service agencies are merging or acquiring direct specialists Allows for common creative direction Also developing new skills necessary for the internet advertising market Account Planning Take over the planning role for an agency Act as supplementary source of ideas for agency or advertiser
Management consultants Provide general consultancy on brand strategy
Selecting an agency
Have they fully understood the brief? Do they know how to use market research? Can they contribute to our thinking here? Is their strategic thinking sound? Is it imaginative? Have I learned anything useful from it? Are they professional and businesslike? Can I work with their senior people? And will they be actually working on my business? Are their capabilities high in all key areas – management, strategy, creative, media? Do they work well as a team – both among themselves and with our people? Is their creative work of a high quality? Is this confined to TV, or does it go across all media? Does this include below-the-line? New media? Can they offer an integrated service? Do they have real expertise in the specialist areas which we are looking at, egl direct marketing, new media? Can they work with us internationally (now or in the future) How do they propose to evaluate the effectiveness of the campaign? What is their attitude to costs? Will they save us money? How will they relate to our media buying agency/other specialists? How important to them will our account be? Will we be one of their larger accounts, or simply a small fish in a very large pool? Will they fit with our ways of working? Are they willing and able to be business partners, or will they simply be suppliers? (This depends – of course – on how we see our own style of dealing with agencies)
Agency Compensation
• • • Commissions from media (15%) Reduced commission system(<15%) Labor-based fee system Outcome-based
Leading advertising Agencies in India
Ogilvy & Mather Limited, Mudra Communications Pvt. Ltd, Lintas India Pvt. Ltd, JWT (Hindustan Thompson Associates Pvt. Ltd.)
FCB-Ulka advertising Pvt. Ltd, Rediffusion DY & R pvt. Ltd. RK Swamy BBDO Pvt ltd. MCCann-Ericsson India Ltd, Leo Burnett, Grey Worldwide (India) Pvt ltd.