chapter 4 the scope of advertising: from local to global
DESCRIPTION
Chapter 4 The Scope of Advertising: From Local to Global. Chapter Overview. Introduces the people and groups who work in advertising. Chapter Objectives. Describe the various groups in advertising and their relationships. Examine factors that affect agency-client relationships. - PowerPoint PPT PresentationTRANSCRIPT
McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.
Chapter 4
The Scope of
Advertising: From Local
to Global
4-2
Chapter Overview
Introduces the people and groups
who work in advertising
4-3
Chapter Objectives
Explain how advertisers organize
Define the main types of ad agencies
Discuss how agencies get clients, make
money
Explain what people do in ad agencies
Debate the pros/cons of an in-house agency
Examine factors that affect agency-client
relationships
Describe the various groups in advertising
and their relationships
Explain how the media and suppliers help
4-4
The Advertising Industry:
Organizations
Advertisers
Agencies
Media
Suppliers
4-5
The Advertising Industry:
People
Sales
Research
Accounting
Management
Most often employed by advertisers, not clients:
Computer science
Writers
Artists
Musicians
Photographers
Performers
LegalCinematographer
s
4-6
Advertisers: Local
Directed to customers in the same geographic area
Independent
businesses
Govt. & nonprofits
Franchisees and
dealers
Chain retailers
4-7
Advertisers: Local
An ad for Rubio’s Baja Grill showcases its unique products
4-8
Advertisers: Local
Typical structure of
small advertisers with high
volumes of work
4-9
Regular price-line, sale, or clearance
Types of Local Advertising
Create favorable image, increase
awareness, foster goodwill
Recruit employees, offer
services, sell merchandise
ClassifiedInstitutionalProduct
4-10
Local Advertisers: Integrators
DirectMarketing
SalesPromotion
MediaAdvertising
PublicRelations
IntegratedApproach
4-11
Advertisers: Cooperative
Vertical Co-op Horizontal Co-op
Firms in the same business or part of town advertise jointly
National brand association
Manufacturer provides complete ad & shares costs
Professional quality ads
Expands advertising budget
4-12
Advertisers: Regional and
National
Top 10 advertisers in the U.S. Ranked by total U.S. advertising in 2008
4-13
Advertisers: Regional and
NationalRegional: one or
several statesNational: several regions
or entire country
4-14
Advertisers: Regional and
National
Comparison of national and local advertising
4-15
Centralized Department
Structure
4-16
Decentralized Department
Structure
4-17
Decentralized International
Structure
• Divisions are responsible for their own product lines, marketing, and profits
• Each division has an advertising dept. to coordinate sales and promotion across brands
• The corporate advertising dept. provides information and guidance
4-18
Centralized Global Structure
• Assumption that product use and needs are universal
• Standardized approach in all countries
• Extensive research to ensure ad is basic and universal
4-19
Agencies: Defined
AgencyRoles
Develop marketing & ad plans
Develop ads & promotions
Purchase ad space and time
4-20
Agencies: Types
SpecialtyBoutiques Media Buyers
Interactive
Full Service
Consumer
BTB
ReachLocal National
Regional
Global
International
4-21
Agencies: People
Traffic Control
Administration
Media Management
Account Management
Other Services
Creative Concepts
Research, Acct planning
Production
4-22
Agencies: Compensation
Ad ratecard price:
$100,000
Agencybuys adat 15%
discount:$85,000
Agencybills client
full ad amount:$100,000
Agency keeps
$15,000difference
Media Commissions
4-23
Agencies: Compensation
Markups
Agencybuys
materialsfor
campaign
Materialscost
$85,000
Agencybills for
materials plus a
17.65%markup
Agency bills
$100,000(cost plus markup)
4-24
Agencies: Compensation
Fees
Fee-commissioncombination
Straight-fee(retainer)method
Incentive system
4-25
Agencies: In-House
Pros
May save money
Allows tighter control
May allow greater attention to the brand
Lower creative quality
Less experience and talent
Loss of objectivity
Cons
4-26
Agencies: Client
Relationships
ReferralsPresentations
Community relations& networking
Solicitation
Finding and Attracting New Clients
4-27
Client-Agency Relationship
Stages
DevelopmentPre-
relationshipTerminationMaintenance
4-28
Client/Agency Relationship
Factors
Communication
Conduct
Chemistry
Changes
The Four Cs
4-29
Suppliers
Art studios &web designers
Printers &related specialists
Film & videohouses
Researchcompanies
4-30
Media
Out-of-home
Digitalinteractive
Electronic
Direct mail
Other
4-31
Media Around the World
McDonald’s honors an Islamic observance