The Advertising Industry

The Advertising Industry

The four groups that make up the industry:

1- Advertisers (clients)
From small businesses to huge multinational firms and in type from
service organizations to industrial manufacturers to charities and
political action committees
2- Agencies
Plan, create and prepare ad campaigns and other promotional
materials
3- Suppliers
Photographers, illustrators, web designers, production houses…
4- Media
Sell time (radio, tv) and space (in print, outdoor or digital media)
1- The Advertisers

Most people working in advertising are employed by advertisers:

Researchers Accounting
Management Sales
Communication Arts Law
Technology Other…
1- The Advertisers

Could be divided into:

For US:
Local: Businesses or retailers that sell within one small trading area
Regional: companies that sell in one part of the country or in 2 or 3
states
National: companies that market in several regions and use the
major mass media

For Lebanon:
Local means national or regional in Lebanon
1- The Advertisers

Type of Local Advertisers:

Target consumers in same geographic area

• Franchises and dealers: KFC

• Stores that sell a variety of branded merchandise/Chain Retailers:
TSC, ABC…
• Specialty businesses and services: Banks, insurance brokers,
restaurants, music store, hair salon… e.g.: Bank Audi
• Governmental and Nonprofits: Charities, arts organizations,
municipality, political candidates e.g.: Kafaa
Type of local Advertising:

Product advertising: promotes a specific product or service and

stimulates short-term action.
It uses 3 types: Regular price-line, Sale, and Clearance.

Institutional advertising: creates favorable long term image of the

business.

Classified advertising: usually recruitment, or searching for specific

products/offerings, sell or leasing…
 What is Cooperative Advertising?

Helps build’s manufacturer’s brand image and help

distributor/dealers/retailers make more sales.
 Cooperative Advertising

Vertical:
National company provides customizable ads and shares cost of
airtime/space with local advertiser

Horizontal:
Same business or businesses in same area, pool their resources to
advertise a common interest.
Local vs. regional/national Advertisers
 Local Advertisers

Department Structure
 Regional/National Advertisers

Centralized department structure

 Regional/National Advertisers

Decentralized department structure

 Transnational vs. Global Advertisers

Transnational Advertisers:
• Decentralized international structure
• Divisions have ad agencies to handle product line
• Managers for brand in each market
• Key is to tap into basic human emotions and universal appeals that
transcend language
 Transnational vs. Global Advertisers

Global Advertisers:
• Centralized global structure
• Standardized approach in all countries
• Extensive research to ensure ad is basic & universal
2- The Ad Agency

What is the he role of Ad Agencies?

• Develop marketing and advertising plans

• Develop ads and promotions
• Conduct before/after research
• Purchase ad space and time
• And so much more…
2- The Ad Agency

Type of Ad Agencies:

Reach
Local, National/Regional, International.

Full-Service (IMC)
they can be classified as either general Consumer agencies or B2B
agencies

Specialty
Creative Boutiques, Interactive, Media Buyers.
2- The Ad Agency

People Working for Ad Agencies:

• Account Management
• Research and Account Planning
• Creative Concepts
• Production
• Media Buying and Planning
• Traffic Control
2- The Ad Agency

How Ad Agencies Make Money?

• Media Commissions
• Markups
• Fees

Or a combination of any of the above

 Agency vs In-house?

Agency In-house

Better deals with media Lower creative quality

and suppliers

Tighter control Less experience & talent

May permit greater Loss of objectivity

attention to the brand

Which do you think is more expensive?

3- Suppliers

There are so many:

• Art studios
• Web designers
• Printers
• Film and video houses
• Research companies

Because an Ad Agency can’t possibly hire everyone!

4- Media

• Print
• Broadcast
• Digital
• Direct mail
• OOH (out of home)

And more, of course…

 Type of Agencies

- Advertising agency
- Media Agency
- BTL agency
- - Interactive/Digital agencies
- Creative Boutiques
 So Far

Many different types of Agencies exist to best serve the different types of
clients and accounts, but they all have two things in common:

- They aim to communicate in the best way possible

- They aim to get paid