Chapter 2:
THE PROMOTION INDUSTRY:
MARKETERS, AGENCIES,
and
MEDIA ORGANIZATIONS
2.1
The Promotion Industry in Transition
ALTERED BY SIX TRENDS

Information in Marketplace is an Interactive System
between Marketers and Consumers

Proliferation of Cable TV, Direct-Marketing & Alternative
New Media Causes Media Fragmentation

Growing Investment in Advertising Causes Media Clutter

New Communications/Distributions Channels
are Growing in Influence

Fragmentation of Marketing Budgets Resulting in Greater
Portions of Budgets going to Trade & Consumer Promotions

Improved Information Systems Allow Retailers &
Distributors more Control over Marketing & Promotional
Decisions
2.2
Structure of the Promotion Industry and Participants in the Process
Marketers
Manufacturers
and service firms
Resellers, retailers,
wholesalers, and
distributors
Government and
social organizations
Advertising and
Promotion Agencies
Advertising agencies:
Full-service agencies
Creative boutiques
Media-buying services
Interactive agencies
In-house agencies
Promotion agencies:
Direct marketing and
database agencies
E-Commerce agencies
Event planning
Design firms
Public relations firms
Sales staffing and training
firms
Agency services:
Account services
Marketing research
Creative and production
services
Media planning research
Agency compensation:
Commission
Markup charges
Fee system
Pay-for-results
Structure of the Promotion Industry and Participants in the Process (con’t)
External Facilitators
Marketing and
advertising research
firms
Production facilitators
Consultants
Information
intermediators
Media Organizations
And Trade Partners
Media Organizations:
Broadcast media
Print media
Interactive media Trade Partners:
Support media
Wholesalers, distributors,
Media conglomerates
retailers
B-to-B trade
communities
Internet portals
Target Audience(s)
Household consumers
Trade resellers
Business and professional
buyer
Government and social
organizations
Structure of Promotion Industry
MARKETERS
 Manufacturing and Service Firms
 Trade Resellers
 Federal, State and Local Governments
 Social Organizations
 March of Dimes
 Nature Conservancy
2.5
The U.S. Government is a
Marketer that Relies on
Advertising
2.5
Structure of Promotion Industry (con’t)
AGENCIES
 Advertising Agencies
 Full Service Agency
 Creative Boutique
 Interactive Agency
 In-House Agency
 Media-Buying Agency
2.7
Advertising Agencies
Use Advertising to Promote
Their Services to New Clients
2.7
Structure of Promotion Industry (con’t)
AGENCIES (con’t)
Promotional Agencies
Direct
Marketing and Database Agencies
Fulfillment Centers
E-Commerce Agencies
Sales Promotion Agencies
Consumer Sales Promotion
Trade Sales Promotion
Event-Planning Agencies
Design Firms
Logo Design
Public Relations Firms
Sales, Staffing, Training & Assessment Firms
2.9
Design Firms Help
Marketers Develop Logo
Designs that Last,
Like this Pillsbury Logo
2.9
Structure of Promotion Industry (con’t)
AGENCIES (con’t)
Agency Services
Account Services
Marketing Research
Creative & Production
Creative Services
Production Services
Media-Planning and Buying
Administrative
2.11
Structure of Promotion Industry (con’t)
AGENCIES (con’t)
 Agency Compensation
 Commissions
 Markup Charges
 Fee System
 Pay-for-Results
2.12
Structure of Promotion Industry (con’t)
EXTERNAL FACILITATORS
 Marketing and Advertising Research Firms
 Consultants
 Production Facilitators
 Information Intermediators
 Trade Partners
2.13
Media Organizations
and Trade Partners
Available to Marketers
 Broadcast Media
 Interactive Media
 Print Media
 Support Media
 Media Conglomerates
 Wholesalers, Retailers,
B2B Communities, Portals
2.14
Portals Offer Marketers a
New Media Outlet for
Placing Advertising and
Promotional Messages
2.14
Structure of Promotion Industry
AUDIENCES
 Household Consumers
 Trade Resellers
 Business and Professional Buyers
 Government and Social Organizations
2.16
Marketers Use Promotion to
Reach the Business and
Professional Buyer Audiences
2.16