Organization of Advertising

Purpose is to communicate effectively

Five participants of IMC process
1. Advertiser (Client)
2. Agency
3. Media organizers
4. Marketing Communications Specialists
Direct Marketing Agencies
Sales Promotion Agencies
Interactive Agencies
Public Relations Firms
5. Collateral services providers


One of the most important
element
Have product/services to offer
Or some cause to market
Is one of the final participant
to decide about ad.
Creates /produces/ place the ads. on
media
Different types of agencies
1. Full service agency
2. Account services
3. Marketing services
4. Creative services

Basic Function is to provide
Entertainment
News
Knowledge in such a way that it
provides an environment to
agency or advertisers to buy their
time and place
are
Direct marketing agencies
Sales promotion agencies
Contests/sweepstakes
Interactive firms
Develop websites
Public relations firms
Services which are been
provided to agencies and
media organizers
Like vendors
Printers etc.
Organizational Structure of Advertising
Three types of structures each have its own adv. &
disadv.
Central system
Decentralized system
Separate marketing, sales, advertising and promotion departments
for various product lines or businesses of the company. Often use
product or brand management system
In-house system
Selection of system depends upon
Size of the orgz.
# of products
Role of ads in the whole process
budget
Procter & Gamble uses the brand management system
Basic function of manager in
centralized system
Planning and budgeting
Administration and execution
Coordination with other departments
Like makting research dept./sales dept./materials
regarding POP.
Coordination with out side agencies and
services
Media buying services/ collateral services agencies
etc.

Advantages
Facilitated
communications
Fewer personnel required
Continuity in staff
Involvement of top
management/ experience
is more
Disadvantage
Some times lower level
staff cant understand the
over all mkting plan as the
responsibility rests on top
Longer response time
Inability to handle multiple
product line.
Client Organization For IMC
The Centralized System
Decentralized system or brand
mangt. system
Advantages
More flexible in term of
promotional programs
Centralized managerial
attention
Rapid response to the
problems.


Disadvantage
Sometimes brand
mangers are at junior
level lack of experience
Brand manger may
have less authority
over the execution of
plan which they have
created.
Misallocation of funds.
In-house system
Advantages

Cost saving

More control

Increased
coordination
Disadvantage

Less experience

Less objectivity

Less flexible
No Fear uses an in-house agency
Source: Courtesy No Fear.
Role of Advertising Agency
Is a service organization that
specializes in
Developing
Preparing and
Executing the promotional programs
for its client.


Reasons for using an
outside Agency
1. U get highly professional people to work for.
2. Artists /writers /singers/media analysis are
normally attached with
3. Agencies are specialized in certain areas like
consumer goods etc.
4. U can get an overall image of mkt. very easily
against company policies /biases/limitations or
we can say it provides us an insight to the
industry. an agency may have personnel who
have worked in some client related industries.


4 Types of Agencies
1. Full service agency
Involved in planning/creative
/producing/research/media selection and
also in some non advertising services like
Strategic mkting planning
Sales promotions
Sales training
Trade shows
Package design
Public relations programs
Publicity
Typical Full-Service Agency
Organization
Writers
Art Directors
Traffic
TV
Produciton
Traffic
Print
Production
VP Creative
Services
Account
Executive
Account
Supervision
VP Account
Services
Media Research Sales
Promotion
VP Marketing
Services
Personnel Accounting Finance
Office
Management
VP Management
and Finance
President
Board of
Directors
2.Account services
Account management is to provide a
link b/w client and agencies

Normally a very experienced and
professional person of marketing is
involved in such type of arrangement.
3.Marketing services
Have :
Research departments
Who is the target audiences
Who is the ultimate consumers
Trends of industries
Consumers habits etc
Segment analysis etc.
Media departments
Must have media profiles

4.Creative services
Responsible for creating and executing ads.
Copy writers: r the personnel who write
,headlines/subhead lines/body copy. May be
involved in basic theme or the big selling idea of
the promotional campaigns.
May have diff. departments
Art department
Prepare story board for TV
Production dept.
Traffic dept.

Some more types of services
Creative boutiques

Provides only creative services. e.g. supreme
with Shoaib Mansoor
Media Buying Services
Some people only buy space in media and
sell to others

Agency Compensation
Diff. Forms of compensation
Commission from media
15% from media
Fixed fee method
Fee-commission combination
Cost plus agreement
Fee basis on the cost of its work
Pay actual cost+profit margin
Incentive based
% charges normally 20-25 % when sub let or
purchase services from others.
Example of the Commission
System
Why Agencies Lose Clients
Poor performance
Poor communication
Unrealistic demands
Personality conflicts
Personnel changes
Changes in size
Conflict of interests
Changes in strategy
Declining sales
Payment conflicts
Policy changes
How Agencies Gain Clients
Referrals
Solicitations
Making calls and following them
Presentation
People ask agency to come and present
itself.
Presentations
Public Relations
Image and Reputation
Awards competitions are a way for agencies to
build their reputation
A promotional agency advertises its
services