Download Organizing for Advertising and Promotion

Organizing for Advertising
and Promotion:
The Role of Ad Agencies and Other
Marketing Communications
Organizations
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Participants in the IMC Process
Advertiser (Client)
Advertising Agency
Media Organizations
Marketing
Communications
Specialist
Organization
Collateral Services
Direct
Response
Agencies
Sales
Promotion
Agencies
Public
Relations
Firms
Interactive
Agencies
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Advertising Department Under
Centralized System
President
Production
Finance
Advertising
Marketing
Marketing
Research
Research
and
Development
Sales
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Human
Resources
Product
Planning
Pros & Cons of Centralization
+ Positive
- Negative
Better
Communications
Less Goal
Involvement
Fewer
Personnel
The
Centralized
System
Longer
Response Time
Can’t Do
Multiple Product
Lines
Continuity
Of Staff
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Decentralized Brand Management System
Corporate
Production
Finance
Sales
Marketing
Research
and
Development
Product
Management
Human
Resources
Marketing
Services
Brand
Manager
Brand
Manager
Ad agency
Ad agency
Advertising
Department
Sales
Promotion
Merchandising
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Marketing
Research
Package
Design
Pros & Cons of Decentralization
+ Positive
- Negative
Concentrated
Attention
Lack of
Experience
in IMC
Rapid Problem
Response
The
Decentralized
System
Increased
Flexibility
Competition for
Resources
Lack of
Authority
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Pros & Cons of In-House Agencies
+ Positive
- Negative
Cost
Savings
Less
Experience
More
Control
The
In-house
Agency
Better
Coordination
Less
Objectivity
Less
Flexibility
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Most No Fear advertising is done by their
in-house agency
+
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Ad Agencies Have Skilled Specialists
Artists
Writers
Researchers
Photographers
Media Analysts
Other Skills
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Full-Services Agencies
Planning
advertising
Creating
advertising
Producing
advertising
Full Range of
Marketing
Communication
and Promotion
Services
Strategic market
planning
Sales promotion
and training
Performing
research
Selecting media
Package design
Non-Advertising
Services
Trade show
materials
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Public relations
and publicity
Typical Full-Service Agency Organization
Board of
Directors
President
VP Creative
Services
Writers
Art Directors
TV
Produciton
Traffic
Print
Production
Traffic
VP Account
Services
Account
Supervision
VP Management
and Finance
VP Marketing
Services
Media
Research
Account
Executive
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Sales
Promotion
Personnel
Office
Management
Accounting
Finance
Services Provided by Agencies
Agency Services
Account
Service
The link between
agency and client
Managed by the
Account Executive
Marketing
Services
Research
department may
design and execute
research programs
Media department
may analyze, select
and contract media
resources
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Creative
Services
Creation and
execution of ads
Copywriters,
artists, other
specialists
The Role of Creative Boutiques
Creative
Boutiques
Provide Only Creative Services
Full-Service Agencies May
Subcontract With Creative
Boutiques
Other Functions Provided by
the Internal Client Departments
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Coca Cola’s in-house boutique
created this popular spot
+
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Media Buying Can Be Specialized
Media
Buying
Services
Specialize in Buying Media,
Especially Broadcast Time
Agencies and Clients Develop
Media Strategy
Media Buying Organizations
Implement the Strategy and
Buy Time and Space
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Methods of Agency Compensation
Commissions
Method
Cost-Plus
Agreements
Compensation
Methods
Percentage
Charges
Fee
Arrangements
Incentive-Based
Payment
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Young & Rubicam has handled
Dr. Pepper for over 30 years
+
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Foote, Cone & Belding was the agency
for Levi’s for 68 years
*Click outside of the video screen to advance to the next slide
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Why Agencies Lose Clients
Poor
performance
Unrealistic
demands
Personality
conflicts
Personnel
changes
Poor
communications
Changes
in size
Conflict of
interests
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Changes
in strategy
Declining
sales
Payment
conflicts
Policy
changes
How Agencies Gain Clients
Referrals
Presentations
Solicitations
Public Relations
Image, Reputation
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Gateway Changed Its Advertising
After Changing Agencies
*Click outside of the video screen to advance to the next slide
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
A Change in Strategy Led to a Change
in Gateway’s Advertising
*Click outside of the video screen to advance to the next slide
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Direct Response Agency Activities
Data Base
Management
Direct
Mail
Media Services
Direct
Response
Agencies
Research
Creative
Production
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Activities performed by Sales
Promotion Agencies
Promotion Planning
Creative Work
Research
Coordination With
Advertising
Premium Design
Contest/Sweepstakes
Development
Data Base Marketing
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Functions performed by Public Relations Firms
Strategy
Development
Damage
Control
Generating
Publicity
Program
Planning
Image
Portrayal
Lobbying
Public
Affairs
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Functions performed by Interactive Agencies
Web
Banner Ads
Web Sites
Interactive
Media Creation
CD-ROMs
Kiosks
Audio
Video
Digital
Content
Animation
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Special Effects
Marketing Research Companies
Planning and
Implementing
Research
Information
Application
Analysis and
Interpretation
Primary Data
Collection
Qualitative & Quantitative
Secondary Data
Collection
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin