Test 2 Notes 

what are the Functions of an Advertising Agency?

2/16/18: Guest speaker; no notes.

________________________________________________________________________ 2/18/16

Major Participants

∙ Advertiser

o AT&T, Chevy, Geico

∙ Advertising agency

o Ogilvy, BBDO, Weiden­Kennedy, etc.

∙ Media

o TV

o Radio

o Internet

∙ Suppliers

o Nielsen: a major data providing service in NYC and Diemen, The  Netherlands that employs 40,000 people worldwide

Functions of an Advertising Agency

∙ Creative Services

∙ Media Services

∙ Research Services

∙ Account Services, those jobs include:

o Account executive

o Account manager

∙ Account Planning—The account planner is the voice of the consumer; they have  to know the audience so well that they can make approve ads or make edits ∙ Integrated Communications

what are the Reasons for using independent outside agency?

Reasons for using independent outside agency

1. Objectivity

2. Quality/Diverse Experience

3. Specialized Personnel Don't forget about the age old question of what are the Difficulties of sociological research?
Don't forget about the age old question of what is Macroeconomics?

4. Working Relationship

Reasons for using an in­house agency

1. Cost Savings

2. Confidentiality

3. Communication

4. Coordination and Control

5. Company and Product Familiarity

Agency Compensation Methods

∙ Original Method was Commission

*Understand this method and the concerts about it that change the way that agencies are  compensated today.

∙ Sliding­scale or Negotiated Commission

2/23/16

Agency Compensation Methods

• Original Method was Commission

◦ Understand this method and the way that agencies are compensated today. • Sliding­scale or Negotiated Commission If you want to learn more check out What is Individual Discrimination?

◦ 15%

◦ A budget bigger than it should be

what are the Reasons for using an in­house agency?

◦ Suggesting media over commission

◦ If I spend a lot of money in media you will make a lot of money • Fixed Fee

◦ The agency and the client develop and understanding of exactly what work the agency is  to do and exactly what they will be paid for their work.

• Cost Plus

◦ Here the agency keeps track of all costs for their time, materials, etc. The client pays all  of these costs PLUS some agreed upon percentage of these costs or dollar amount for  agency profit.

◦ Cost: what it costs for the agency to do work

Every agency is a business so the agency can make a profit

Role of Media

• Delivery Mechanism

• Suppliers

◦ People and organizations that supply specialized services to advertisers (and their  agencies)

◦ Important suppliers include

1 Art Studios and Web Designers

2 Printers and Print Production Houses

3 Film and Video Production Houses

4 Research Companies

Advertising Campaign

An advertising campaign consists of an analysis or marketing and communications  situations in order to establish objectives and make strategic decisions to be carried out in a series of advertising messages to be places in advertising media 

2/25/16 Don't forget about the age old question of What is plea bargain?

Research Process

Steps in the research process

• Establish the Need for Information

• Specify Research Objectives

• Determine Sources for Data

a.

Primary Data  

Needed

Secondary Sources

∙ when you actually develop  a research study to answer 

the questions you have (pay

someone to do this)

4. Develop Data Collection 

Forms

5. Design the Sample

a. The people that are going

to participate in your study

6. Collect the data

7. Process the data

∙ Information that is already  there (on Google or in 

Library)

8 Analyze the Data Don't forget about the age old question of How many significant figures are in the number 4001?

Present Research Results Input to Campaign Planning

• Competitive Situation

◦ Research on competition 

Product Research

9 How the product is used

10 How the product is designed to satisfy the consumer

11 How the product is packaged distributed and promoted

12 The product's image

1 Image: the consumer's overall perception of the brand.

13 The position the product holds in the mind

1 Position: Consumer's perception of the brand relative to their perception of

competing brands.

14 Understanding consumer responses and relationship to the advertised product, service, or  idea.

15 Market Analysis

▪ Understanding market and cultural trends and identifying marketing opportunities. Competitive Analysis Don't forget about the age old question of What would change the Demand curve?

▪ Monitoring the effects of the competition

▪ Nielsen 

◦ Offers competitive analysis for brand, category sales management, as well as retail  services.

▪ Kantar Media 

◦ Offers competitive intelligence services­helps companies compute global share of voice  by analyzing earned, paid and owned media.

Research Basis for

• Developing Advertising Objectives

• Objectives= statements of what you will accomplish with your advertising efforts. Research Points to Responses

• Identifying the appropriate response is the mist difficult aspect of developing advertising  objectives.

Basic Response Categories

1 Think/Learn 

a Developing awareness

b Beliefs about the brand

c Knowledge of the brand

2 Feel/Emotional 

a Emotional responses (ex. happy, sad, anxious, fearful, excited)

3 Do/Behavioral

Ex: trial purchase, repeat purchases, information search, store visit, website visit, sharing  information with others, etc.

3/3/16

Functions of Objectives 

1. Coordination and communication

2. Decision making

3. Evaluation of the campaign

Five Characteristics of good objectives

1. Specific response and is measurable

2. Define the target audience

3. Benchmark and degree of change sought

4. Time Period

5. Written

*E.g.: To increase awareness from 20%­50% among women ages 19­49 with household  incomes above $15,000 in one year.