Professional Documents
Culture Documents
The Advertising Business: Ad Agencies Roles, Structure & Functions Income Client Agency Relationship
The Advertising Business: Ad Agencies Roles, Structure & Functions Income Client Agency Relationship
Why an Ad Agency?
Branding as a concept developed Brands are assets Advertising function required specialized skill sets Intra-organization bias could be reduced Outsourcing was viewed as a cheaper option
7
Agencies: Roles
Agency roles
International Division
R& D
Manufacturing
Package Design
Brand Mgr
Ad Agency
Merchandising
Brand Mgr
Ad Agency
Structure of an Ad Agency
Agency Head
Client Servicing
Account Planning
HR
Finance
Acc.Dir Art
Acc. Exec
Planners
Buyers
10
Media Planner
Studio/Production
11
12
13
15
16
Agencys income
Media Commissions
Agency bills client full ad amount:
Rs.100,000
Rs.15,000
18
Agencys income
Other Commissions Markups 17.65% on the invoice from outside suppliers
Agency buys materials for campaign Agency bills for materials plus a 17.65% markup
Materials cost
Rs.8,500
Agency bills
Rs.10,000
Agencys income
Fee-commission combination
Basic monthly fee + media commissions
Incentive system
Compensation depends on campaigns goal attainment Eg: DDB Needham has a grade point scale to evaluate campaigns
20
Agencys income
Competency-based system Followed by Leo Burnett, Lintas, and a few others, which links agency remuneration to sales figures Can be a serious hindrance to brandbuilding advertising
21