WHY DO YOU NEED AN ADVERTISING AGENCY?

An advertisers/manufacturers prime responsibility is to manufacture product/s, offer service/s etc. Manufacturing/servicing in itself is specialized, complicated and often difficult process. Moreover the Product/Service needs to withstand the competition day-in and day-out. Along with it the advertiser needs to spend considerable amount on Research & Development, innovation to stay in business. He needs to continuously upgrade the product/s, services to avoid stagnation, obsolescence. All these are daunting tasks. It requires controlling various activities at multiple levels i.e. drawing board, work-force, procurements, pricing, distribution network, supplies, sales, market feed-back, competition etc. Advertising undoubtedly is an important part of the entire marketing operation and plays a very crucial role. However it is a highly specialized field. Moreover in todays environment it forms the backbone of entire marketing activity. Thus under these circumstances Advertiser is seldom (rarely) interested in setting and running a full-fledged advertising agency. An independent organization, like advertising agency, employs highly skilled professionals and is experienced and exposed to variety of products right from consumer durables, semi-durables, perishables, industrial etc., products. An advertiser finds this rich experience invaluable. He often knows that it is practically impossible for him to employ such a large force of highly skilled and highly paid personnel in a single department. Besides employing such a large force for one or two products is uneconomical. He also realizes the fact that if employed, they (personnel) would soon reach a point of stagnation and creativity churned out would be mediocre. The advertiser also needs to note another important commercial aspect. Media owners (Print, TV, Outdoors, Radio) offer discounts on Volume Business to the agency because agency in turn promises/places assured business with them. These benefits are often passed on by the agency to the advertisers. However, advertiser would be deprived of these benefits, if were to go alone. Thus Advertiser/Manufacturer finds it prudent to hire the services of an Advertising Agency.

WHAT MAKES A GOOD AGENCY?

The answer is simple. Good advertising is advertising that produces sustained results. So a good ad agency is the one, which delivers those results. Stating the obvious does not unlock the key to the question. Good advertising requires thought, innovation and precise execution by the ad agency that fully understands every aspect of marketing, marketing problems, advertising tasks, media, and design. A good advertising should make your customer feel good about what they are buying from you and it makes your staff feel that they are working for a reputed, quality conscious organization. A good advertising agency is the one, which helps clients concentrate on their (clients) business and help them make money. To help clients achieve this advertising agency should meet the following criterion: Consistency: It should build a campaign on a sound product proposition. The consistency of the campaigns message should be retained in all the mediums of advertising. The last thing you want is different

messages, different propositions in different mediums leaving the consumers confused leading ultimately to destroying your own market with your own money. Creativity A Creative team which believes that what you say is more important than how you say it. The designed ad campaign should meet the primary objective of advertising. It is neither created to satisfy creative teams quest to win awards nor is it created to pamper clients ego but to win customers. Creative advertising should help coincide the selfish interest of the manufacturer with the interest of the society. Media Relations An excellent inter-personal relationship with media is a prime requisite for an agency to service clients. That is what ultimately counts in obtaining better space, better time and better discount deals with all the mediums. Accounts Executive Well read, well-informed, well-mannered, jovial, hard working go-getter is what clients expect of an Accounts Executive from their ad agency to service them. He is dependable and trustworthy. He should understand clients marketing problems thoroughly to come out with practical solutions. Thus, in short ad function like a clients partner in this particular venture. In essence ad agency should be competent enough to take the total responsibility of clients advertising communication problems and functions like an extended arm of its marketing set up.

EVALUATION OF AN ADVERTISING AGENCY

The most critical step in hiring an ad agency is the final agency evaluation. Most of this though undoubtedly related to interactive chemistry, there exist some specifics they do look for: Does the agency show enthusiasm for you and your business? Do they get it? They dont necessarily have to have a long history of working in your specific category, but they need to demonstrate that they understand your business Who are their current clients and what kind of work are they producing for them? What do their current clients think of them? Check their references. Will they bring you new thinking and be willing to challenge some of your assumptions. (If you are looking for an agency to agree with you all the time, there is a fairly good chance that you wont accomplish your objective) Ask them who would be working on and responsible for your account within the agency. Lastly, discuss compensation. In most cases, if youve done a good job of explaining the assignment, it wont vary all that much between the agencies.

CRITERIA AGAINST WHICH CLIENTS CAN ASSESS AN ADVERTISING AGENCY.

Relevant criterion include: Size of the agency relative to the client. The agencys location and accessibility. The agencys ability to provide the type of advertising and allied services that the client is seeking. The extent to which the agency specializes in advertising in clients market. The agencys history and track record. The agencys adaptability and compatibility with that of clients team.

The agencys ability to manage itself and its clients business efficiently and cost effectively

STAGES IN CLIENT-AGENCY RELATIONSHIP

In the advertising business, the life cycle of agency-client relationship has four stages: Pre-relationship, Development, Maintenance, and Termination. The Pre-relationship Stage: This is the stage where client and agency are yet to get into any official business agreement. Both may know each other by reputation, previous ads for other clients, social contacts or through referrals. Initial perception usually determines if an agency is invited to pitch the account. Then through presentation process, the agency tries to give the best impression it can because it is selling and the client is buying. The Development Stage: Once the agency is hired/appointed the development stage begins. In this honeymoon period, the agency and the client are at the peak of their optimism and eager to develop a mutually understanding profitable relationship. Expectations are at their highest, and both the sides are mutually accommodating each other through many stages. During this period the rules of the relationship get established with greater degree of understanding and mutual consent. Several delicate issues, which may arise in future are resolved right in the beginning by drafting proper terms of agreement of business transactions. It helps a great deal in maintaining a lasting association. The respective roles get set quickly, the true presentation of all the players are discovered, and agencys first work/campaign gets presented. Its a time when client awaits agencys work with great expectation but judges it quite pragmatically. Agency in the process begins to understand client, organizations culture and philosophy, its attitude to switch over to newer ideas or recommendations. During this period it is vital that agency establishes an extremely cordial relationship with all the players from various departments of the clients organization. Agency also needs to understand clients attitude towards settling of its bills. Maintenance Stage: This is maturity stage. The client and agency both have been living and growing together. Both have reached a smooth day-to-day working relationship. Unfortunately this also could be one of the most critical phases in relationships. Both start taking each other for granted. If both do not take corrective measures the maintenance stage tends to veer towards strain. If at this stage if the rift widens and both fail to resolve the differences its time to terminate the relationship on an amicable note. It is not always that the differences that lead to separation. There could be many reasons other than just a rift or complacency to accelerate termination of business contracts. Termination Stage: The termination of contract between the two could be any of the following reasons: 1. Clients growth is faster than the agencys and thus agency is incapable of giving the required services. 2. International alignment/collaboration may force client to change agency or vice-versa 3. Mergers & Takeovers either of clients or agencies 4. Management Changes 5. New product introduction by client or agency signing up bigger account in the same category of products 6. Brand failures. Incompetent servicing. Stagnant creativity. Poor strategy.

7. Uneconomical media buying reflecting in poor negotiation skills of the agency. 8. Payment disputes.