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#6 Ad Agency

Wayland Ayer founded the first advertising agency in Philadelphia in 1869 at age 20. Advertising agencies provide services like developing advertising campaigns, placing ads in media, and conducting market research for clients. Major types of agencies include full-service agencies that handle all aspects of advertising, media specialists, and creative boutiques. Within agencies, account services work directly with clients, media placement determines advertising strategy, market research informs campaigns, and creatives execute ad design and production. Agencies make money through commissions on client spending and negotiated performance contracts.

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418 views19 pages

#6 Ad Agency

Wayland Ayer founded the first advertising agency in Philadelphia in 1869 at age 20. Advertising agencies provide services like developing advertising campaigns, placing ads in media, and conducting market research for clients. Major types of agencies include full-service agencies that handle all aspects of advertising, media specialists, and creative boutiques. Within agencies, account services work directly with clients, media placement determines advertising strategy, market research informs campaigns, and creatives execute ad design and production. Agencies make money through commissions on client spending and negotiated performance contracts.

Uploaded by

babydutt1
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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Advertising Photography

Ad Agencies--How They Operate

Pioneer Agencies

Wayland Ayer

20 year old entrepreneur in 1869 Founded first advertising agency in Philadelphia Because of his age, he used his fathers name to start his business: N.W. Ayer & Son Created advertisements and offered services similar to what agencies still provide: Counsel on selling products and services Design services for ads & campaigns Expertise on placing ads in media

Types of Ad Agencies

Full-Service Agency Media Specialists Creative Boutiques Vendors (freelance writers, photographers, designers, interactive media specialists, etc.)

Types of Advertising Handled by Agencies

Brand

Most visible--national consumer Focuses on local geographical retailers/manufacturers B2B--one business to another Corporate advertising-corporate identity Charities, foundations, hospitals, museums, etc. PSAs-communicate causes for social good

Retail/Local

Business-to-Business

Institutional

Nonprofit

Public Service Advertising

Ad Agenciestoday

Full-Service Agencies
Create

ad & place in media for clients Conduct market research for clients Design & produce advertisements Choose media--buy time and space for ads

Basic ad agency facts

Leading 500 U.S. agencies


Employ

120,000 people worldwide

In the U.S.--about 73,000 2004 Super Bowl, agencies placed 30second TV spots at $2.5 million each!

Job Assignments & Responsibilities

Account Services Media Placement Market Research Creative

Account Services

Most people in this department are account executives (AE). Work directly with client Liaison between client and agency AEs bring in new business to the agency

Media Placement

They determine most effective media for delivering clients ad message Buy time and space in the media (e.g., radio, TV, or magazines) Responsible for getting ad to media Job title for these folksmedia buyers

Market Research

Also known as Research & Development (R&D) Generates information on demographics Targets ads to specific consumer markets This information used by creative & media staffs to guide their decisions

Creative
Responsible for actual execution of creating the ads

Copywriters Graphic designers Layout people Photographers (rare occasion)

Web designers & developers Art directors Copy supervisors Creative directors

Ad Agency Structure
Ad Agency CEO

Account Services Manager

Creative Director

Media Director

Art Director

Copy Supervisor

Broadcast Director

Layout & Web

Graphic Designers

Copy Writers

Producer/writer

How Agencies make MONEY

Until recent historyall agencies charged 15% of clients total outlay for space/time Commission contract--this was the 15% charge, broke down in the 1990s

Advertising Age reports only 10-20% use contracts today Today, generally negotiated

Performance contracts--client pays costs plus negotiated profit

Some Interesting Ad Facts


Largest Advertisers
General Motors Time Warner

Dollars Spent per Year


$3.7 Billion $2.0 Billion

Procter & Gamble

$2.7 Billion

A Few More Ad Facts


Largest Ad Agencies
Omnicom WPP Publicis Dentsu

Headquarters
New York London Paris Tokyo

World $$$
$7.5 billion $5.8 billion $2.7 billion $2.1 billion

Recap

Advertising is BIG money! Ad Agencies service external clients Agencies provide a broad ranges of services for clients

Client w/o in-house ad agency


Advertising Organization

Advertising Department

External Agencies: Full-Service Agency Media Specialists Creative Boutiques Vendors

Client with in-house ad agency


Advertising Organization

Internal Advertising Department

In-house Agency: Research/Planning Creative Development Media Production

This concludes Lecture #3

References:

Campbell, R., Martin, C. R., & Fabos, B., (2005). Media

and culture: An introduction to mass communications (5th ed.). Boston: Bedford/St.


Martins. Vivian, John, (2005). The Media of Mass Communications (7th ed.). New York: Pearson

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