Ad Agencies and Others Part 2

8/20/2019 Ad Agencies and Others Part 2

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Organising for Advertising andOrganising for Advertising and

Promotion in the FirmPromotion in the Firm• The Centralised Sstem

• The !ecentralised Sstem

• "n#$ouse Agencies


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%


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The Centralised SstemThe Centralised Sstem

C'O

Production Finance Marketing

Marketing Research Advertising Sales

R(! $R

Product Planning

Advertising Manager )

Marketing Communications Manager


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Advertising !e+artment : Functions Advertising !e+artment : Functions

• Planning and ,udgeting

- ,ased on Marketing Plan. O/0ectives and ,udget

• Administration and '1ecution

- "n#house or ith Ad Agencies

• Coordination ith other !e+artments

- 3ike Sales. Marketing Research : "n+ut ) Out+ut

• Coordination ith Outside Agencies and Services

- Media ,uing. Printing45


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The Centralised SstemThe Centralised Sstem

• ,enefits

- Facilitates communication

- Faster decision making

- 'fficient o+erations

• Pro/lems

- !ifficult to understand the overall marketing strateg

- Ma /e slo in res+onding to s+ecific needs and +ro/lems

- Once /ig. it might /e im+ractical


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$eadline: After s&outing the 'hole 'orld, (ohn and )i&ola &hose hea*en.

,aseline: +ods %'n -ountry Agenc: $tark


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$eadline: Hello +erms

Su/head: "ntrodu&ing /ears

'ith int tra&t

,aseline: +erm $hield Agenc: &-annri&kson

Client: Hindustan e*er td


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$eadline: $kindulgen&e

,aseline: 5 years of stardom

Agenc: (Client: Hindustan e*er td


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$eadline: 7ont s&rat&h, just s&ru8.,odco+: ost efoliating

methods are harsh and a8rasi*e

and remo*e more than dead &ells

from the outer surfa&e of your skin.

"ntrodu&ing ne' 7o*e +entle

foliating 9ar 'ith 8lue i&ro8eads that gently efoliate dead

skin &ells, 'ithout lea*ing harsh

s&rat&hes. he gentlest 'ay to

soft, smooth, radiant skin

Agenc: %:

Client: H


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The !ecentralised SstemThe !ecentralised Sstem

C'O

Production Finance Marketing

Sales Product Management Marketing Services

R(! $R

,rand Manager

,rand Manager

,rand Manager

Ad !e+artment Marketing Research

Sales Promotion

Package !esign

Merchandising

Ad Agenc

Ad Agenc

Ad Agenc


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• 3arge Cor+oration ith multi+le divisions and man

different +roducts

• 'ach +roduct or /rand assigned to ,rand ) Product

Manager - Res+onsi/le for total management of the

/rand incl5 +lanning. /udgeting. sales and +rofit

+erformance

• Multi+le Ad agencies involved ith different +roducts )

services


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Categor Management SstemCategor Management Sstem

Oversees management of theOversees management of the

entire +roduct categorentire +roduct categor and focusesand focuses

on theon the strategic role of the various /randsstrategic role of the various /rands

in order to /uildin order to /uild +rofits and market share+rofits and market share


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• ,enefits

- Concentrated managerial attention

- Faster decision making. Faster res+onse to +ro/lems and o++ortunities

- More fle1i/le

• Pro/lems

- ,rand Managers ma lack training and e1+erience

- Ma focus too much on short#term +lanning and administrative tasks

- Managers ma com+ete against one another for management attention.

marketing ru+ees45

- Fails to +rovide com+lete authorit over various functions


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"n#$ouse Agencies"n#$ouse Agencies

• Set u+. oned and o+erated / the Advertiser

• To reduce advertising and +romotion costs and

maintain greater control over agenc activities

• 'ither e1clusive or ith hel+ of outside agencies

• Can +rovide associated services at loer costs

• Time Saving

< Contd4


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"n#$ouse Agencies"n#$ouse Agencies

• ,ad e1+eriences from outside agencies

• "ncreased knoledge and understanding of the

market

• Tighter control over the +rocesses

• 'asier coordination ith the firm=s overall

marketing +rogramme


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"n#$ouse Agencies : !isadvantages"n#$ouse Agencies : !isadvantages

• 3ess '1+erience

• 3ess O/0ectivit

• 3ess Fle1i/ilit


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AD AGENCIES AD AGENCIES I N I N D I AI N I N D I A


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AD AGENCIES AD AGENCIES• Ogilv and Mather

• 3oe 3intas

• ,ates

• McCann 'rickson• $TA

• Am/ience !>Arc

• Saatchi ( Saatchi

• T,?A Anthem

• @asgiannetti

• $akuhodo Perce+t

• R Sam ) ,,!O

• Mudra

• Rediffusion#!B(R

• 'uus• Contract

• "nterface

• FC, Dlka

• 'uroRSCE

• Ca+ital


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The Ad Agenc=s RoleThe Ad Agenc=s Role

• Reasons for using an Ad Agenc

- Services of highl skilled individuals

- Communication solutions ith o/0ective

vie+oint of the market

- "nsight into the industr and in some case

com+etition


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T+es of Ad AgenciesT+es of Ad Agencies

• Full Service Agencies

• Creative ,outiues

• Media ,uing Services


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Full Service AgenciesFull Service Agencies

,oard of !irectors

President

@P. Creative Services @P. Account Services @P. Marketing Services @P. Management ( Finance

?riters. Art !irectors Print Production

T@ Production

Account Su+ervision Media Research

Sales Promotion

Office Management Personnel

Accounts ) Finance


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H;-H

Account Services Account Services

http://www.hutch.in/home/index.asphttp://www.hutch.in/home/index.asp


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Marketing ServicesMarketing Services

• Research # Thorough situation analsis through

research

• Media - Analses. selects and contracts for s+ace or

time in the media

- 3eo ,urnett : Starcom

- McCann 'rickson ?orldide : Dniversal McCann


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Creative ServicesCreative Services

• Creation and e1ecution of advertisements

- Co+riters : $eadlines. Su/heads. ,od Co+

- Art !e+artment : 3aouts for Print and Stor/oards for T@C

- Production !e+artment : $ire +rinters. +hotogra+hers.

filmmakers. t+ogra+hers4

- Traffic !e+artment : Coordinates all +hases of +roduction and

looks after deadlines


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Management and FinanceManagement and Finance

• Performing /asic o+erations and

administrative functions : Accounting Finance.

$uman Resources

• More than *; goes for salaries and /enefits

for its em+loees


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Agenc Organisation and Structure Agenc Organisation and Structure

• !e+artmental Sstem

• Erou+ Sstem


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Other T+es of Agencies and ServicesOther T+es of Agencies and Services

• Creative ,outiues : !entsu=s "ki. @as

Eianetti. Si1 "nches Communication. M(M

Connect

• Media ,uing Services - Starcom. "nitiative.

Dniversal McCann


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Media ,uing ServicesMedia ,uing Services

• "nde+endent com+anies that s+ecialises in the

/uing of media


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Agenc Com+ensation Agenc Com+ensation

• Commissions from media

• Fee. Cost and "ncentive /ased Sstem


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Commissions from MediaCommissions from Media

• Dsuall *. Also negotiated commission sstem

• 'as to administer

• Criticism - 'ncourages agencies to recommend high media e1+enditure

- Ties agenc com+ensation to media cost

- Sstem tem+ts agenc to avoid noncommissiona/le mediasuch as !irect Mail. Sales +romotion etc5


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Fee. Cost and "ncentive ,ased SstemFee. Cost and "ncentive ,ased Sstem

• Fi1ed fee method : ,asic monthl fee

• Fee#Commission Com/ination

• Cost Plus Agreement : "ncludes direct costsG+ersonnel time and out of +ocket e1+ensesH I

Allocation for overhead I Marku+ for +rofits

- Jeeds careful cost accounting


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Fee. Cost and "ncentive ,ased SstemFee. Cost and "ncentive ,ased Sstem

• "ncentive ,ased Com+ensation

- "ncludes o/0ective measures such as Sales or Market Share

- Su/0ective measures such as evaluations of the ualit of the

agenc=s creative efforts

• Percentage Charges

- Adding a marku+ of +ercentage charges to various services.

the agencies +urchases from outside +roviders

- Additional 756*


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'valuating Agencies'valuating Agencies

• Financial Audit

- !esigned to verif costs and e1+enses. the no5 of +ersonenel

hours charged to an account. +ament to media nad outside

su++liers

• Kualitative Audit

- Agenc=s efforts in +lanning. develo+ing and im+lementing the

client=s advertising +rogrammes and considers the results

acheived


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?h Agencies lose clients L?h Agencies lose clients L

• Poor +erformance or service

• Poor communication

• Dnrealistic demands / the client

• Personalit conflict

• Personnel Changes

• Changes in the sie of the client ) agenc

• !eclining Sales


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$o Agencies gain clients L$o Agencies gain clients L

• Referrals

• Solicitation

• Presentations ) Pitch ) Creative Shootout

• Pu/lic Relations

• "mage and Re+utation


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Thank Bou4

Documents

Ad Agencies and Others Part 2