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8/6/2019 Advtg Management Project

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An advertising agency is:

An independent business organisation

Composed of creative and business people

Who develop, prepare and place advertising on advertising media

For sellers seeking to find customers for their goods and services.

-American Advertising Agency Association (AAAA)

Evolution of the advertising agency

Origin of the advertising agency - the first ever agency was put together in Britain in 1800 called Whites

which created advertisements for the Government lotteries and mostly recruitment advertising. First agencies

were no more than space brokers, selling press advertising space on a freelance basis for newspapers.

As the production and penetration of newspapers increased, the brokers began to compete by offering

copywriting and design service. The messages were repetitive and lacked creativity. This soon led to the birth of

creative advertising agencies. The early account executive was known as the contract man

After the Second World War the agencies developed additional services like market research, media planning

etc

Today there are more than 500 advertising agencies in India today. The oldest one being Hindustan Thompson

Association Ltd.


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Broadly there are 6 departments in any advertising agency

Account Servicing

Account Planning

Media

creative

Production

Finance and Accounting

Account service department

The account service, or the account management department, is the link between the ad agency and its clients.

Depending upon the size of the account and its advertising budget one or two account executives serve as liasonto the client. The account executives job requires high degree of diplomacy and tact as misunderstanding may

lead to loss of an account. The account executive is mainly responsible to gain knowledge about the clients

business, profit goals, marketing problems and advertising objectives.

The account executive is responsible for getting approved the media schedules, budgets and rough ads or story

boards from the client. The next task is to make sure that the agency personnel produce the advertising to the

clients satisfaction. The biggest role of the account executive is keeping the agency ahead of the client through

follow-up and communications.

Media department

The responsibility of the agencys media department is to develop a media plan to reach the target audience

effectively in a cost effective manner. The staff analyses, selects and contracts for media time or space that willbe used to deliver the ad message. This is one of the most important decisions since a significantly large part of

the clients money is spent on the media time and/or space. The media department has acquired increasing

importance in an agencys business as large advertisers seem to be more inclined to consolidate media buying

with one or few agencies thereby saving money and improving media efficiency.

Creative department

To a large extent, the success of an ad agency depends upon the creative department responsible for the creation

and execution of the advertisements. The creative specialists are known as copywriters. They are the ones who

conceive ideas for the ads and write the headlines, subheads and the body copy. They are also involved in

deciding the basic theme of the advertising campaign, and often they do prepare the rough layout of the print ad

or the commercial story board.

Creation of an ad is the responsibility of the copywriters and the art department decides how the ad should look.

Production department

After the completion and approval of the copy and the illustrations the ad is sent to the production department.

Generally agencies do not actually produce the finished ads; instead they hire printers, photographers, engravers,

typographers and others to complete the finished ad. For the production of the approved TV commercial, the

production department may supervise the casting of actors to appear in the ad, the setting for scenes and


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selecting an independent production studio. The production department sometimes hires an outside director to

transform the creative concept to a commercial.

Finance and accounting department

An advertising agency is in the business of providing services and must be managed that way. Thus, it has to

perform various functions such as accounting, finance, human resources etc. it must also attempt to generate

new business. Also this department is important since bulk of the agencys income approx. 65% goes as salary

and benefits to the employees.


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Five important Ms of an ad agency

The organizations handle their advertising in different ways. In small companies, advertising is handled by

someone in the sales or marketing department, who works with an ad ageny. A large company will often set up

its own advertising department or else hire an ad agency to do the job of preparing advertising programmes.

In developing a program, marketing managers must always start by identifying the target market and the buyers

motives. Then they can make the five major decisions in developing an advertising program, known as the five

Ms, viz.

Mission: what are the advertising objectives?

Money: how much can be spent?

Message: what message can be sent?

Media: what media should be used

Measurement: how should the results is evaluated?

The above mentioned can be explained by the diagram given below

The 5Ms of Advertising

Checklist for planning of a marketing or advertising campaign.

Mission

What are the objectives?

What is the key objective?

Money

How much is it worth to reach my objectives?

How much can be spent?

Message What message should be sent?

Is the message clear and easily understood?

Media

What media vehicles are available?

What media vehicles should be used?

Measurement

How should the results be measured?

How should the results be evaluated and followed up?


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ADVERTISING AGENCY IN INDIA

The First World War created conditions for the growth of some of the Indian

consumer industries. After the war, new British investment followed. The need

arose for specialized advertising services. The British India Corporation, a

British firm in Kanpur, with a relatively wide range of consumer goods, set up

Alliance Advertising Associates Limited. This was probably the first advertising

agency in India to provide a wide variety of services. In 1922, Mr. L.A.

Stronach, a senior artist of Alliance Advertising, left to start his own agency in

Bombay. Thus was born a new type of business enterprise in the service sector

in India.

The Indian advertising industry had a slow start and got its first boost during

the Second World War. With the British personnel having to join the armed

forces, opportunities opened up for Indians in this new talent-intensive

business. Then followed a brief interlude of uncertainty in the years

immediately following Independence. The launching of the First Five-Year Plan

and more so the Second Five Year Plan, with the accent on rapid

industrialization, gave an impetus to the growth of advertising agency business

in India. By 1952 there were 109 advertising agencies in India with a total

turnover of Rs 3.5 corer. By 1967, the number of advertising agencies had increased to 279 with a total turnover

of Rs 35 corer. The Indian advertising

industry has really come' into its own with the growing li beralization of the

economy since the mid-eighties. According to the fourth agency report of the

journal Advertising and Marketing, the Indian advertising industry grew by

36.5 per cent in 1992 -93, far outpacing the growth of Indian industry. What is

significant, however, is that three of the top four advertising agencies in India

continue to be subsidiaries of international advertising agencies-HindustanThompson Associates and Lintas India being the first two, and Ogilvy & Mather

being the fourth. What is more with the new interest of many national

corporations in the Indian market, a large number of international advertising

agencies have entered the Indian advertising industry in collaboration with

leading Indian advertising agencies. This is the process of globalization of

Indian advertising agency business. This is opening up new opportunities for

Indian advertising to assume greater responsibility and serve everywhere in the

world and gather experience of global marketing and advertising.

The Working of Ad Agencies

To begin with, the agencies started as one-man agents who booked space in the

Media. Even today, in our country, there are so many one-man agents who

book space in the media. Soon the space booking was handed over to the

contact-man, and creative wordsmiths adept at sloganising undertook the

actual construction of the ad. In the course of years, the ad agency became

service-oriented, and was able to offer every possible service including

marketing, market research (MR), and public relations (PR).

Ad agencies have evolved over a period of time. These days we have mostly

studio-based agencies, some industrial and specialized agencies, and hot-


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shops who only plan creative campaign by engaging the services of freelancers.

At Madison Avenue, most of these large agencies of the world fiercely compete

for new accounts, resulting in a shift of millions of dollars of billing from one

agency to another. Advertising Age is an official publication of the American

Association of Advertising Agencies (AAAA).

In India, advertising business is worth Rs. 8,000 corers. There were only 62

advertising agencies in 1958, which increased to 168 in 1978, more than 2.5

times the numbers in 1958. There are more than 500 ad agencies today. The

oldest and largest advertisement agency in India is Hindustan Thompson

Associates Ltd. The second largest advertisement agency is Lintas.

Mumbai is considered to be the Mecca of Indian advertising. These days

agencies are also being set up at Bangalore, Madras, Hyderabad, Ahmedabad

and Delhi. In India the ad agencies are sole proprietary concern, partnership or

private limited companies.

necessarily plough back at least 75 % of its profits into business.

The advertising agencies are shifting from the creative mode to the marketing

mode. Today the onus is on the agency to supply the client with data on his

industry; the days of the clients briefing the industry are almost over. The

agencies are expected to maintain database. There is a leaning towards

software for optimizing media usage, and computerization of studio functions.

In India, the legal structure of ad agencies is that of a small proprietary

concern or a big partnership. Sometimes, they are private limited companies,

either big or small. Indian advertising is a fragmented business. There are over

733 agencies accredited to INS. The top 25 account for 50% of all billings. In

addition, there are many accredited agencies.

It is the top 25 agencies, most of which are headquartered in Mumbai, that set

the pace and define the shape of the industry. Agencies like HTA, Lintas,Clarion and O & M have shaped the entire advertising industry in the country.

Many Indians firms are coming up, by importing Western ad techniques.

Many agencies die a premature death. Most people do not appreciate that an

agency like any other business - must be properly managed. It is simply not

enough just to have great idea.In recent years, there has been a healthy trend

towards sound management practices, especially financial planning and

control.

This is a highly paid profession. It is a conspicuous high wage island. People

operate on high profile. Their life-styles are opulent because of high expense

accounts 'of entertaining clients. They got their elitist brand due to this reason.

But high salaries and freedom are necessary to attract talents


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People working in an agency:

Accounts Executive: It is a key career option in advertising agency. He is

called an Account Director when he is a member of the Board. He is a link

between a client and his staff. The marketing or advertising department of theclient briefs him. He communicates this to the agency people.

He reaches out to different clients for seeking new business. Even clients who

want an agency' to work for them contact the accounts executive. This

business development work makes it virtually a marketing manager of the

agency.

Do right-brained people make better account directors?

The faculties of logic and reason are supposed to reside in the left-brained

people. While intuition and creativity are believed to be in the right. So far,

accounts director was considered suitable if logical and systematic, i.e., left-

brained. But if he has to motivate a team, he should be inspiring and creativetoo, i.e., right-brained.

Copywriters: They are the wordsmiths who do the wording of an

advertisement. They are bright and talented. They have a flair for language.

They contribute to the theme of an advertisement. Creation of successful copies

for different clients establishes them in this field.

Visualisers: These are artists who put on paper what has been thought out by

the copywriter. They in fact design the ad.

Creative Director: He co-ordinates the copywriting and designing. He is a

senior professional who is seasoned in an existing advertising agency set-up to

take on this mantle

Production Department: Persons of diverse talents like printing technology,

DTP, photography,typography etc. are involved here.


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Media Planner: He has to allocate the advertising budget amongst media. He

has to select the appropriate media. He decides about the frequency, size and

position of an advertisement. He decides about its publication date. He receives

the tear-off copies from the media when the ad is published. He is guided by

the media research, which he undertakes, or by research undertaken by an

outside agency. Media is the most professionalized department of advertising

agencies.

Marketing Research: Modern agencies are integrated set-ups. They provide a

range of marketing services. Research data become very useful as input to the

creative process.

The Media : Most of the media today sustain on advertising revenue. They sell

space or time. While selling space or time, they have to convince the client

about the reach of their media vehicle, the composition break-up of their

readers and the pricing of their space/time selling. They monitor the market,

survey their readers, and highlight their readers' demographic and geographic

characteristics. They also maintain relationship with the media department of

advertising agencies who buy space/time on behalf of clients.

Ancillary Services : These are needed to produce/create advertisement. A

whole range of services like studio service, photographic service, printing

service, gift item producers etc. fall into this category.

Freelancers : These are professionals who work independently and have a

successful track record. They are copywriters, jingle singers, radio announcers,

artists, visualizers, technical writers etc


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Advertising Process

When preparing your search proposal, you should take into account that thelead-in time needed to place an ad

can vary anywhere from days to monthsdepending on the publication. You should plan to have your ad

approved and anestimate of the cost done at least one month prior to the date when you want the ad tobe

published. The advertising process for professional staff and faculty positions involves five basic steps:

1. Writing an Ad

2. Getting Approval for the Text of the Ad

3.Estimating the Cost of the Ad

4.Placing Ads & Posting Announcements

5. Paying for Ads


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Since its inception in 1986, Contract Advertising India Ltd. has skillfully delivered successful results to its high-

profile clientele including Tata Indicom, Religare, Asian Paints, Dominos Pizza, SpiceJet, Samonsite and

American Tourister. Contract Advertising India Ltd. is known for its one -of-a-kind specialty divisions that

provide complete advertising solutions. These divisions include DesignSutra, iContract and Core Consulting.

advtg management project

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