MRK317Integrated Marketing

Communications

The Advertising Industry in Canada

Regulations in Canada

Participants in the IMC Process

Figure 16-1

Participants in the IMC Process

Advertiser (Client)Key participants in the processHave the products, services, or causes to be

marketedProvide funds to pay for advertising/promotions

Advertising AgencyAn outside firm that that specializes in the

creation, production, and/or placement of the communications message

Participants in the IMC Process

Media Organizations Provide an environment for the firm’s marketing

communications message

Specialized Marketing Communications Services Include direct marketing agencies, sales promotion

agencies, interactive agencies, and public relations firms

These organizations provides services in their areas of expertise

Management Issues of Advertising Agencies

Advertising Agency Decision In-House Agency OptionAdvertising Agency Option

Full Service Advertising Agencies

Account ServicesMarketing ServicesCreative ServicesManagement and FinanceStructure

Account Services

Account services is the link between the ad agency and the client

The account executive is responsible for interpreting the advertiser’s needs to the agency

Account Services

Coordinates agency efforts in planning, creating, and producing ads

Presents agency recommendations and obtains client approval

Marketing Services

Research DepartmentGather, analyze, and interpret information

important in developing advertisements

Media DepartmentAnalyzes, selects, and contracts for space or

time in the media selected for the client

Creative Services

Copywriters are responsible for the creation and execution of advertisements

May be involved in determining the basic appeal or theme of the campaign

The art department is responsible for how the ad looks

Creative Services

Coordinating the creative and production processes can often be a major problem

A traffic department coordinates all phases of production to ensure all deadlines are met

Management and Finance

Advertising agencies must be managed and perform operating functions such as accounting, human resources, etc.

Must generate new business

Bulk of an agency’s income goes to salary and benefits for employees

Other Types Of Agencies and Services

Creative Boutiques

Media Buying Services

Creative Boutiques

Creative boutiques have developed in response to desires to utilize outside creative talent only

Clients may believe extra creative effort is required or its employees do not have sufficient skills

Boutiques usually perform creative functions on a fee basis

Media Buying Services

Independent companies that specialize in the buying of media, particularly radio and television

Agencies and clients usually develop their own media strategies and hire a buying service to execute them

Media buying services have grown in recent years as clients seek alternatives to full-service agency relationships

Paid a fee or commission for their work

Agency Compensation

Commissions from Media

Other Compensation SystemsFee ArrangementCost-Plus Agreement Incentive-Based CompensationPercentage Charges

Gaining and Losing Clients

Poor performance or servicePoor communicationUnrealistic demands by the clientPersonality conflictsPersonnel changes

Gaining and Losing Clients

Changes in the size of the client or agencyConflicts of interestChanges in the client’s corporate and/or

marketing strategyDeclining salesConflicting compensation philosophiesChanges in policies

Advertising Regulation in Canada

Canadian Radio-television and Telecommunications Commission (CRTC)

Regulation of Tobacco Advertising

Quebec Regulations on Advertising to Children

Advertising Standards Council (ASC)

CRTC

Mandate is to ensure the Broadcasting Act of 1991 and Telecommunications Act of 1993 are upheld throughout Canada

Make certain that all Canadians can receive broadcasting and telecommunications services

CRTC

Advertising aspects regulated:Advertising Limits Infomercials900 numbersAlcohol and drugs

Not covered:False and misleading ads Internet

Regulation of Tobacco Advertising

Restricted by Health Canada regulations on their use of traditional advertising media

Sponsor various arts, cultural, and sporting events (discontinued in 2003)

Regulation of Tobacco Industry

Print ads communicating sponsorships were only permitted advertising

Underground marketing has emerged, communication of brands occurs through exclusive distribution in select bars, pubs and nightclubs

Quebec Regulations on Advertising to ChildrenConsumer Protection Act of Quebec

It is illegal to direct commercial messages to persons younger than 13

Concerns the product, the way the ad is presented, and the time and place the ad is shown

Advertising Standards Council (ASC)Not-for-profit, self regulatory, industry body

with mandate to create and maintain community confidence in advertising

Represents advertisers media organizations and advertising industry suppliers

ASC

Canadian Code of Advertising StandardsDescribes what is not acceptable advertisingPertains to the content of ads only Intention is to provide standards so that

responsible and effective advertising resultsGender Portrayal Guidelines

Ensure that women and men are portrayed appropriately in advertising

ASC

Complaint ProcessHandles complaints in three streamsConsumer complaints: from ordinary citizens

who believe an ad is unacceptableSpecial interest groups: from a demonstrated

organization that expresses a unified viewpointTrade disputes: complaints from other

advertisers

ASC

Complaints ReportComprehensive annual report Identification of advertisers and the details of all

complaintsClearance Process

AlcoholCosmeticsNon-prescription drugs Ads directed towards childrenFood

Ethical Effects of Advertising

Advertising as Untruthful or Deceptive

Advertising as Offensive or Bad Taste

Advertising and Children

Examples of Shock Ads

Many People Found Benetton’s “Sentenced to Death” Campaign Offensive

Advertising is Used to Address Social Problems

Using Advertising to Fight the War on Drugs