ADVERTISING:
Advertising Agencies
July 17, 2016
Advertising
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Industry Participants
Clients
(Advertisers)
•Advertising
Department
Ad Agency
•Client services
•Creative services
•Media buying
•Finance
•Research
July 17, 2016
Advertising
Media
•Print
•Broadcast
•Out-of-Home
•Direct
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Advertising Salaries
TITLE
AVERAGE SALARY
CEO
$250,000
Creative director
150,000
Chief financial officer
100,000
Art director
50,000
Copywriter
40,000
Account executive
30,000
Media buyer
27,500
Assistant (starting)
25,000
July 17, 2016
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Types of Ad Agencies
Agencies provide 4 different services:
 Account management
Creative Services
Media Buying Services
Research Services
July 17, 2016
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Specialty Shops
• Creative Boutiques
• Media Buying
• Public Relations
July 17, 2016
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“Personalities”
• But even full service agencies
have their own personalities
and specialties….
• [video on Fallon (McElligott)]
• McCann-Erickson
• TBWA/Chiat Day
July 17, 2016
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Fallon
Fallon
Fallon
Fallon
July 17, 2016
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Fallon
July 17, 2016
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McCann-Erickson
“OLD RELIABLE”
• CLIENTS:
• Exxon
• 90 years
• GM (Buick, Cadillac, Pontiac…)
• 70 years
• Coca-Cola
• 60 years
• Nestles
July 17, 2016
• 60 years
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McCann-Erickson
July 17, 2016
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McCann-Erickson
July 17, 2016
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TBWA/Chiat Day
A “Hip” agency
• Based in Venice Beach CA and NY
Clients:
• Absolut vodka
• Apple Computer
• Nissan
• Sony Playstation
July 17, 2016
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TBWA/Chiat Day
TBWA/Chiat Day
Compensation strategies
1. Commission -- 15% [or less]
• 8-10% on very large accounts
2. Fees
• fixed prices on some items,
• percentage on others
3. Cost-plus
• actual costs [!] + percentage
4. Incentive-based
• often performance [sales] based!
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July 17, 2016
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Selecting an Ad Agency
Client Defines Needs
Long List
Questionnaire
Short List
Credentials Presentation
Decision
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Selecting an Ad Agency
• Activity
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10 Questions to Ask
1. What do we need from an agency?
2. Who should handle the media buying?
3. What compensation strategy do we want?
4. Do we want a specific kind of advertising campaign?
5. How important is regular access to the president?
6. Does the agency have success in direct marketing?
7. Do we want an agency to handle existing or newproducts?
8. Does the location of the ad agency matter to us?
9. Who will be in charge of advertising decisions?
10.Do you love the agency’s work and its results?
July 17, 2016
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Why Agencies Lose Clients
1. Poor performance (sales)
2. Quality of work or service
3. Philosophical differences
4. Unrealistic demands or expectations
5. Personality or personnel changes
6. Client or agency consolidation
7. Conflicts of interest
8. Just for the heck of it!
July 17, 2016
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FCB LAYS OFF 7% OF IRVINE,
CALIF. STAFF
Fate of Entire El Segundo
Office in Question
July 17, 2016
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Quote of the Day
I have learned you can’t have good
advertising without a good client, that you
can’t keep a good client without good
advertising, and no client will ever buy
better advertising than he understands or
has an appetite for.
•Leo Burnett
July 17, 2016
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