UNIT-4

Advertising Agencies
An advertising agency is a company that creates and plans when, where and how an advert
will be delivered and presents it to the client. The advertising agencies are fully
independent from their clients. The main task advertising agencies is to make sure that the
clients’ products are sold effectively. The advertising agencies normally have experts in
certain fields to assist their clients reach their prospective customers in a simple and easy
way. The main clients of advertising agencies include; non-profit making organizations,
corporations, government agencies and businesses.

Types of advertising agencies

- Full service agencies

The full service agencies carry out research, create, plan, produce advertisements
and select media. Other services offered by the full service agencies include sales
training, sales promotion, strategic market planning, event management, package
design, trade shows and public relations.

- Creative agencies
Creative agencies job is to create the actual advertisements only. The creative
agencies create interesting and imaginative advertising themes and also produce
original and innovative advertisements. A client that contracts a creative agency will
also have to contract another advertising agency to carry out other administrative
functions relating to advertising.

- Specialized agencies
A Specialized agency offers its services within a certain industry such as real estate,
financial, medical and education or a particular function e.g. public relations,
research, marketing and internet. Specialized agencies therefore concentrate on
specific areas only.

- In-house agencies
In-house agencies are owned by the advertisers. The In-house agencies are formed
and supervised by the company. They perform all functions relating to advertising
the company’s product as in the case of full service agencies. Most companies
establish the in-house agencies in order to cut the cost of advertising. A company
may use its in house agency only or may contract an external agency to work
together with its in house agency.

- Interactive agencies
Interactive agencies are a bit unique from others because of the services that they
offer. They offer services such as web development and web design, internet
advertising-commerce consulting and search engine marketing. Interactive agencies
 became very popular before the other advertising agencies fully adopted the use of
internet.

- Media buying agencies

A media buying agency is a company that buys television and radio time and then
resells the time to other advertising agencies and advertisers. Media buying
agencies also assist the advertisers to plan the media strategies. Media buying
agencies normally buy a lot of space and time from the various media stations thus
they are given huge amounts of discounts that enable them sell the television and
radio time at low prices to the small advertising agencies and clients.

Functions of an Advertising Agency

1. Attracting clients
Advertising agency needs clients (advertisers). Without them, it cannot survive.
Ad agency always tries to attract clients usually by giving ads in trade journals. It also
seeks their attention by offering them various services. It offers expert, cheap and quick
services. It maintains good relations with them. It tries to give them full satisfaction. It
strives harder to attain their goodwill and customer-loyalty.

2. Research function
Advertising agency gathers information related to the client's product.
It collects following information about a product under its research function:

 Features, quality, advantages and limitations of a product,

 Present and future market possibilities,
 Competition in the market,
 Situation in the market,
 Distribution methods,
 Buyers' preferences, so on.

Ad agency analyses (studies) all this collected information properly and draws
conclusions for its research. It helps in planning an advertising campaign, selecting
proper media and creation function.

3. Advertising planning
Advertising agency plans the entire ad campaign of its client.
Advertising planning is a primary function of an ad agency. It is done when its research
function is completed. That is, after analyzing the client's product, its competitors, market
conditions, etc. It is done by experts who use their professional experience to make a
result-oriented advertising-plan.
 After making the advertising plan, it is shown to the client. If the client likes and
approves it, then the plan is executed (put into action).

4. Creative function
Advertising agency put the advertising-plan into action under its creative function.
Creation of ads is the most important function of an ad agency. Generally, it involves
activities like:
- Copy writing
- Drawing photographs
- Making illustrations, layouts, an effective ad message, etc.

These jobs are done by experts like copy writers, artists, designers, etc. These people are
highly skilled and creative. They make an advertisement more appealing. Attractive ads
help to increase the sales of the product.
The ad agency must always use fresh ideas for creating ads. It must neither use old tactics
nor copy the ad-campaign of other products.

5. Media selection
Advertising agency helps an advertiser to select a proper media (ad platform) to promote
his advertisement effectively.
Media selection is a highly specialized function of an ad agency. It must select the most
suitable media for its client's ad. It must choose media, which has a potential to give best
results for the lowest cost. It must select more than one media for the ad. For example, an
advertisement can be put on television, the Internet, newspapers, magazines, etc.
After selecting the media, the ad agency must maintain goods contacts with the media.

6. Advertising budget
Advertising agency helps an advertiser to prepare his ad budget. It helps him to use his
budget economically and make the best use of it.
Without a proper advertising budget, there is a risk of client's funds getting wasted or
lost. If an advertiser suffers a loss, he may not bring new projects. As a result, there is a
possibility of losing a potential client that can bring more business to an ad agency.

7. Coordination
Advertising agency brings a good coordination between the advertiser, itself, media and
distributors. This is a very important function. If coordination is proper, it will increase
the sales of the product.

8. Sales promotion
 Advertising agency performs sales promotion. It helps an advertiser to introduce sales
promotion measures for the dealers and consumers. This helps to increase the sales of the
product.
9. Marketing research
Advertising agency helps its clients to solve their marketing problems. It does so by
conducting a marketing research for them.

10.Non-advertising functions
Advertising agency also performs many non-advertising functions:

 It fixes the prices of the product,

 It determines the discounts,
 It designs the product,
 It also designs its package, trade marks, labels, etc.

These non-advertising services help an advertiser to increase its sales.

11.Public relations
Advertising agency does the public relations (PR) work for its clients. It increases the
goodwill between its clients and other parties like consumers, employees, middlemen,
shareholders, etc. It also maintains good relations between the client and media owner.

Departments of an Ad Agency

Professionals at advertising agencies and other advertising organizations offer a number of

functions including:

 Account Management

Within an advertising agency the account manager or account executive is tasked with
handling all major decisions related to a specific client. These responsibilities include
locating and negotiating to acquire clients. Once the client has agreed to work with the
agency, the account manager works closely with the client to develop an advertising
strategy. For very large clients, such as large consumer products companies, an
advertising agency may assign an account manager to work full-time with only one client
and, possibly, with only one of the client’s product lines. For smaller accounts an account
manager may simultaneously manage several different, though non-competing, accounts.

 Creative Team

The principle role of account managers is to manage the overall advertising campaign for
a client, which often includes delegating selective tasks to specialists. For large accounts
one task account managers routinely delegate involves generating ideas, designing
concepts and creating the final advertisement, which generally becomes the responsibility
of the agency’s creative team. An agency’s creative team consists of specialists in graphic
design, film and audio production, copywriting, computer programming, and much more.
 Researchers

Full-service advertising agencies employ market researchers who assess a client’s market
situation, including understanding customers and competitors, and also are used to test
creative ideas. For instance, in the early stages of an advertising campaign researchers
may run focus group sessions with selected members of the client’s target market in order
to get their reaction to several advertising concepts. Researchers are also used following
the completion of an advertising campaign to measure whether the campaign reached its
objectives.

 Media Planners

Once an advertisement is created, it must be placed through an appropriate advertising

media. Each advertising media, of which there are thousands, has its own unique methods
for accepting advertisements, such as different advertising cost structures (i.e., what it
costs marketers to place an ad), different requirements for accepting ad designs (e.g., size
of ad), different ways placements can be purchased (e.g., direct contact with media or
through third-party seller), and different time schedules (i.e., when ad will be run).
Understanding the nuances of different media is the role of a media planner, who looks
for the best media match for a client and also negotiates the best deals