ADVERTISING MANAGEMENT ASSIGNMENT

AD AGENCIES

M.SARANRAJ
215114036

ORGANISATION STRUCTURE OF AN ADVERTISING

AGENCY

DIRECTOR

ACCOUNT
MANAGEMEN
T

MEDIA
BUYING

CREATIVE
DEPARTMENT

RESEARCH

ACCOUNT
HEAD

MEDIA
HEAD

CREATIVE
HEAD

RESEARCH
HEAD

ASSISSTANT
HEAD

ASSISSTANT
HEAD

ASSISSSTANT
HEAD

ASSISSTANT
HEAD

EXECUTIVE

EXECUTIVE

EXECUTIVE

EXECUTIVE

MANAGER

MANAGER

MANAGER

MANAGER

EMPLOYEE

EMPLOYEE

EMPLOYEE

EMPLOYEE

The activities within an advertising agency are typically divided into 4 broad
groups: account management, the creative department, media buying, and
research.

i) Account Management : Works closely with the client to map out their
communications needs and define the role the agency can play in helping meet
their business objectives. Engages agency resources as appropriate and ensures
all the work done for the client is suitable for their business and that projects run
smoothly. On a day-to-day basis, this means creating agency teams to work on
specific projects, communicating the agency opinion in formal points of view,
presenting work, and setting timelines and budgets. There are a number of levels
within the account management group.

ii) Creative/ Services Advertising can take many forms (TV commercials, radio
spots, print ads, and outdoor billboards to name a few), but collectively they are
referred to as the creative. Development of the creative is typically done in
teams of two. A Copywriter (words) and an Art Director (visuals) work together to
create rough versions of the ads including: TV storyboards, print layouts, and
radio scripts. Creative teams can work successfully together for years -- often
hired, fired and promoted together. The Creative Director , who approves all the
work before it is shared with the client, has a tremendous influence on all the
work an agency develops, ensuring that the work is unique and appealing while
strategically on target. Once an idea for a radio or TV ad is ready to be brought
to life, a Producer joins the team. The producer coordinates with the outside
resources necessary to produce finished ads. He estimates the cost to produce
the ads, writes contracts, and coordinates the production from start to finish. The
Traffic Manager performs a similar function for print ads, estimating costs and
coordinating these jobs from start to finish. In addition, the Traffic Manager is
also responsible for getting all ad materials where they need to go.

iii) Media Planning and Buying Typically, the largest portion of a marketers
budget goes towards buying media. This places a huge responsibility on the
media planning and buying department. Media Planners determine what
combination of TV, Radio, Magazines, etc., would reach as many target
consumers as possible at the lowest cost. The result of their research and
analysis is the Media Plan, a calendar of scheduled advertising The
measurements they use include: Reach: what percentage of the target audience
will be exposed to the ad Frequency: how many times the average consumer in
the target audience will be exposed to the ad Effective Reach: also referred to as
3+ reach, quantifies the percentage of the target audience that will be exposed
to the ad more than three times Media Buyers take the media plan
recommended by the planners and negotiate its purchase as inexpensively as
possible.

iv) Research and Account Planning Advertising agencies began actively doing
research in the 1920s. This research was focused on answering specific business

questions about products and consumer preference. Research was typically not
an integral part of the creative development process until the introduction of
Account Planning. Account Planning began in England during the 1960s. It
focuses on consumer attitudes and branding for the goal of creating a unique
identity for the clients brand which is distinct from the competition and
compelling to the target consumer. Research centers around focus groups where
small groups of consumers tell agencies a lot more about what consumers think
and feel than a nationwide survey. Account Planners use this information to
weave facts together into compelling stories. These stories can form the basis of
a brand positioning, a unique product benefit or perhaps even a commercial
storyline. Many agencies have created unique planning processes. For example, J
Walter Thompson relies on TTB (Thompson Total Branding), McCann has the
Brand Footprint, and Bates offers the Brand Wheel.

These divisions are usually physically separated, although all four areas work
closely together to produce an advertising campaign in its entirety.
Account managers usually have daily interaction with a counterpart at the
client's office and coordinate the activities of the other departments according to
the client's wishes. The creative department designs original themes or concepts
for ads, while the media department places finished ads within the media in
which they will receive the most exposure to a target audience. The research
department provides data about consumers to help the agency and the client
make informed advertising decisions.
Recently added to advertising agencies' roster of services are public relations,
direct marketing, and promotional services. Other activities that used to be
completed by outside vendors, such as photography and high-tech print work,
have been brought in-house in many agencies.

FUNCTIONS OF VARIOUS DEPARTMENTS

1. Contact Department. Creation, sustaining an extension are the three basic

functions of the department. It gets new business and tires to continue the
existing business. Accounts Executive of the departments is the key man who
acts as a liaison between the agency on the one hand and the clients on the
other.
2. Media Department. After making the advertisement plan, the agency
selects the best possible medium. It is choosing the channels o communication
trough which to distribute the advertising. The media analyst and estimators
decide the approximate kind and number of potential customers and then to
choose the media that get the message to them.
3. Copy Department. The copy director coordinates the work of writing the
copy with the assistance of copy chief and copy writer. The advertisement copy
is the heart of advertising programme as it contains the message. Copy writing
requires imagination, flair and fluency in the language and then to choose the
media that copy is the outcome of his interest, mood and ability.
4. Art and Visualization Department. The art director heads this department.
He is assisted by artists, lay-out men and visualizers. Art director gets prepared
visuals and lay-outs for press advertisements, posters, calenders, printed
bulletins, car cards and other out door pieces. Some agencies hire the outside
artiste. There should be close cooperation between the department of art and
copy as they supplement the work of each other.
5. Production Department. When a copy is ready the agency proceeds to its
mechanical production, agencies generally use out side units for these
production services. The production manager as to move to the typographers or
type setters to have copy set in type, later to the photoengraver for the
illustrations. Finally he moves to the electro-typer for electro-types mats or other
duplicate material in such qualities as needed.
6. Finance Department. The accountants are responsible to maintain
accounts, billing and collecting the dues from the customers. The checking
section verifies the production and publicity of each individual case, may be
press medium or outdoor or radio or television or cinema etc. The aim is to see
that such publicity is really helping the advertiser. It is interested in realizing the

goals of publishing whether the advertisement is to day or after a coupe of days

or a week or a month.
7. Research Department. This section of the advertising agency is engaged in
the study of h effects of sales activities at the end of the point f distribution of a
particular product. Sometimes outside research organisations are employed to
carry on such research as they are more economical and reliable. The Research
director takes the assistance of analyst, investigators, marketing assistants
clerks and librarians. All these persons are trained in research work and are in a
position to evaluate the information relating to the product.
8. public Relations Department. The birth, growth and survival of an
advertising agency depend very much on the public opinions, support and
feelings it sis public opinion that decides the destiny of the enterprises. The
department establishes an maintains mutual understanding between the
organisation an the public. Public relations approach is the product of publicists
an advertising men.

COMPENSATION METHODS
Agencies may be compensated in a variety of ways including:

A. Commissions from Mediathe agency is compensated based on the time or

space it purchases for its client. The commission is typically 15% (16 2/3% for
outdoor), and sometimes has been negotiated downward. The commission
system has been the target of criticism for a number of years as critics argue
that it ties agency compensation to media costs and encourages agencies to rely
too much on expensive, commissionable media such as network television and
avoid non commissionable media. Many advertisers have moved to a negotiated
commission system that takes the form of reduced percentage rates, variable
commission rates and minimum and maximum compensation rates. A recent
survey by the Association of National Advertisers found that less than 10 percent
of clients pay their agencies a 15% commission. However, most clients do use
the 15% commission as a benchmark to evaluate their current agency
compensation agreement.
B. Fee, Cost and Incentive-based Systemsin situations where billings are low,
and/or the client does not wish to pay a direct commission, an agreement may
be reached in which the agency is compensated in the way of a fee, cost-plus or
incentive-based compensation system.
1. Fee arrangements are of two types: a fixed-fee method where the agency
charges a basic monthly fee for all of its services and credits to the client any
media commissions earned. Under a fee-commission combination the media
commissions received by the agency are credited against the fee. If commissions
are less than the agreed-on fee, client must make up the difference.
2. Cost-plus agreementunder this compensation method the client agrees to

pay the agency a

fee based on costs of its work plus some agreed-on profit margin. This system
requires the agency to keep detailed records of costs incurred in working on a
clients account.
3. Incentive-based compensationwhile there are many variations on this
system, the basic idea is that the agencys compensation level will depend upon
how well it meets predetermined performance goals for its clients such as sales
or market share. Incentive-based compensation. Incentive based compensation
systems are becoming more prevalent as marketers are seek to make their
agencies more accountable and reduce costs.
C. Percentage Chargeswhen agencies purchase services from other outside
agencies they typically add a percentage in the form of a markup charge as their
compensation. These markups usually range from 17.65 to 20 percent.

TYPES OF ADVERTISING
Advertising is the promotion of a companys products and services carried out
primarily to drive sales of the products and services but also to build a brand
identity and communicate changes or new product /services to the customers.
Advertising has become an essential element of the corporate world and hence
the companies allot a considerable amount of revenues as their advertising
budget. There are several reasons for advertising some of which are as follows:
Increasing the sales of the product/service
Creating and maintaining a brand identity or brand image.
Communicating a change in the existing product line.
Introduction of a new product or service.
Increasing the buzz-value of the brand or the company.

Thus, several reasons for advertising and similarly there exist various media
which can be effectively used for advertising. Based on these criteria there can
be several branches of advertising. Mentioned below are the various categories
or types of advertising:

i) Print Advertising Newspapers, Magazines, Brochures, Fliers

The print media have always been a popular advertising medium. Advertising
products via newspapers or magazines is a common practice. In addition to this,
the print media also offers options like promotional brochures and fliers for
advertising purposes. Often the newspapers and the magazines sell the
advertising space according to the area occupied by the advertisement, the
position of the advertisement (front page/middle page), as well as the readership
of the publications. For instance an advertisement in a relatively new and less
popular newspaper would cost far less than placing an advertisement in a
popular newspaper with a high readership. The price of print ads also depend on
the supplement in which they appear, for example an advertisement in the
glossy supplement costs way higher than that in the newspaper supplement
which uses a mediocre quality paper.

ii) Outdoor Advertising Billboards, Kiosks, Tradeshows and Events

Outdoor advertising is also a very popular form of advertising, which makes use
of several tools and techniques to attract the customers outdoors. The most
common examples of outdoor advertising are billboards, kiosks, and also several
events and tradeshows organized by the company. The billboard advertising is
very popular however has to be really terse and catchy in order to grab the
attention of the passers by. The kiosks not only provide an easy outlet for the
company products but also make for an effective advertising tool to promote the
companys products. Organizing several events or sponsoring them makes for an
excellent advertising opportunity. The company can organize trade fairs, or even
exhibitions for advertising their products. If not this, the company can organize
several events that are closely associated with their field. For instance a
company that manufactures sports utilities can sponsor a sports tournament to
advertise its products.

iii) Broadcast advertising Television, Radio and the Internet

Broadcast advertising is a very popular advertising medium that constitutes of
several branches like television, radio or the Internet. Television advertisements
have been very popular ever since they have been introduced. The cost of
television advertising often depends on the duration of the advertisement, the
time of broadcast (prime time/peak time), and of course the popularity of the
television channel on which the advertisement is going to be broadcasted. The
radio might have lost
its charm owing to the new age media however the radio remains to be the
choice of small-scale advertisers. The radio jingles have been very popular
advertising media and have a large impact on the audience, which is evident in
the fact that many people still remember and enjoy the popular radio jingles.

iv) Covert Advertising Advertising in Movies

Covert advertising is a unique kind of advertising in which a product or a
particular brand is incorporated in some entertainment and media channels like

movies, television shows or even sports. There is no commercial in the

entertainment but the brand or the product is subtly( or sometimes evidently)
showcased in the entertainment show. Some of the famous examples for this sort
of advertising have to be the appearance of brand Nokia which is displayed on
Tom Cruises phone in the movie Minority Report, or the use of Cadillac cars in
the movie Matrix Reloaded.

v) Surrogate Advertising Advertising Indirectly

Surrogate advertising is prominently seen in cases where advertising a particular
product is banned by law. Advertisement for products like cigarettes or alcohol
which are injurious to heath are prohibited by law in several countries and hence
these companies have to come up with several other products that might have
the same brand name and indirectly remind people of the cigarettes or beer
bottles of the same brand. Common examples include Fosters and Kingfisher
beer brands, which are often seen to promote their brand with the help of
surrogate advertising.

vi) Public Service Advertising Advertising for Social Causes

Public service advertising is a technique that makes use of advertising as an
effective communication medium to convey socially relevant messaged about
important matters and social welfare causes like AIDS, energy conservation,
political integrity, deforestation, illiteracy, poverty and so on .Oglivy once said,
"Advertising justifies its existence when used in the public interest - it is much
too powerful a tool to use solely for commercial purposes.". Today public service
advertising has been increasingly used in a non-commercial fashion in several
countries across the world in order to promote various social causes. Priyanka
Chopra is riding high these days with back-to-back successes and endorsements
and inaugurations and everything else under the sun.
However, the actress makes it a point to keep her feet grounded and do her bit
for the society. She participated in SAVE CHILDREN campaign.

vii) Celebrity Advertising

Although the audience is getting smarter and smarter and the modern day
consumer getting immune to the exaggerated claims made in a majority of
advertisements, there exist a section of advertisers that still bank upon
celebrities and their popularity for advertising their products. Using celebrities
for advertising involves signing up celebrities for advertising campaigns, which
consist of all sorts of advertising including, television ads or even print
advertisements.

CONCLUSION

In todays world which is fast moving & dynamic, peoples wants, need and
desires are changing; its very important to know them and give them what they
want. This is the main objective of advertising where ad agency plays major role
in market research, making of creative, launching it in the market, taking the
feedback of consumer and making any product famous and acceptable among
consumers. Ad agencies are playing an important role in shaping present and
future of not just
selected brand but of entire company. There is no one -- sure-fire -- best way to
advertise your product or service. It is important to explore the various
advertising media and select those which will most effectively convey your
message to your customers in a cost-efficient manner. Always remember,
advertising is an investment in the future of your business.

REFERENCES
1. http://smallbusiness.chron.com/role-client-service-managers-advertisingagency-41524.html
2. http://www.artgroupindia.com/
3. http://en.wikipedia.org/wiki
4. http://www.rainsbirchardmarketing.com/blog/agency