chapter three the advertising industry mcgraw-hill/irwin essentials of contemporary advertising...
TRANSCRIPT
![Page 1: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/1.jpg)
chapter three
The Advertising Industry
McGraw-Hill/IrwinEssentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.
![Page 2: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/2.jpg)
3-2
Objectives_1
Describe the various groups in the advertising business and explain their relationship to one another
Discuss the differences between local and national advertisers
Explain how advertisers organize themselves to manage their advertising both here and abroad
Define the main types of advertising agencies
![Page 3: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/3.jpg)
3-3
Objectives_2
Explain the range of tasks people perform in an ad agency and an in-house advertising department
Discuss how agencies get new clients and how they make money
Debate the pros and cons of an in-house advertising agency
Explain how suppliers and the media help advertisers and agencies
![Page 4: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/4.jpg)
3-4
The Advertising Industry
Advertisers Advertising
agencies Suppliers Media
![Page 5: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/5.jpg)
3-5
Types of Local Advertisers
Dealers or local franchises
Stores with branded merchandise
Specialty businesses
Government and non-profit
![Page 6: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/6.jpg)
3-6
Exhibit 3-1 Departmental Structure for Small Advertisers
![Page 7: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/7.jpg)
3-7
Types of Local Advertising
Product advertising
Institutional advertising
Classified advertising
![Page 8: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/8.jpg)
3-8
Cooperative Advertising
Seeks to
build the manufacturer’s brand image
help distributors, dealers, or retailers make more sales
![Page 9: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/9.jpg)
3-9
Differences between Local and National Advertisers
National Focus
– Brand– Market share– Strategies– Markets
Long-term time frame $5-10 million + Use of many specialists
Local Focus
– Location– Volume– Tactics– Customers
Short-term time frame < $1 million Use of few generalists
![Page 10: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/10.jpg)
3-10
Exhibit 3-3 Top 10 Advertisers
Rank Company U.S. Ad Spending(in millions)
1 General Motors 3,997.4
2 Proctor & Gamble 3,919.7
3 Time Warner 3,283.1
4 Pfizer 2,957.3
5 SBC 2,686.8
6 DaimlerChrysler 2,462.1
7 Ford Motor Co. 2,458.0
8 Walt Disney Co. 2,241.5
9 Verizon 2,197.3
10 Johnson & Johnson 2,175.7
![Page 11: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/11.jpg)
3-11
Large Company Structures
Exhibit 3-5
A Centralized Structure
![Page 12: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/12.jpg)
3-12
Large Company Structures
Exhibit 3-6
A Decentralized Structure
![Page 13: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/13.jpg)
3-13
Transnational Advertising
![Page 14: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/14.jpg)
3-14
Will a Global Advertising Strategy Work?
Has each country’s market for the product developed in the same way?
Are the targets similar in different nations?
Do consumers share the same wants and needs?
![Page 15: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/15.jpg)
3-15
The Advertising Agency
An independent organization of creative people and business people who specialize in
1)developing and preparing marketing and advertising plans, advertisements, and other
promotional tools, and
2)purchasing advertising space and time
in various media in order to find customers for their clients’ goods and services
![Page 16: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/16.jpg)
3-16
Types of Agencies
Geographic Scope
Range of Services
Specialized Agencies
![Page 17: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/17.jpg)
3-17
Geographic Scope
LocalLocal
RegionalRegional
NationalNational
InternationalInternational
![Page 18: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/18.jpg)
3-18
Range of Services
Full-service
1) General consumer2) Business-to-business
Specialized
1) Creative boutiques2) Media-buying services
3) Interactive
![Page 19: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/19.jpg)
3-19
What Agency People Do
Account Management
Research and Account Planning
Creative Concepts
Production Traffic Management Agency
Administration Additional Service
![Page 20: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/20.jpg)
3-20
Exhibit 3-7 Agency Structure
![Page 21: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/21.jpg)
3-21
Agency Compensation
Media commissions Markups Fees
– Fee-commission combination
– Straight-fee– Retainer– Incentive system
![Page 22: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/22.jpg)
3-22
In-House Agency
Some companies like Benetton prefer
to create their ads using their own in-
house agency
![Page 23: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/23.jpg)
3-23
ReferralsReferrals
PresentationsPresentations
NetworkingNetworking
Soliciting New BusinessSoliciting New Business
How Agencies Get Clients
![Page 24: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/24.jpg)
3-24
Suppliers in Advertising
Art Studios Web Designers Printers Film/ Video Houses Research
Companies
![Page 25: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/25.jpg)
3-25
ElectronicElectronic
PrintPrint
Digital InteractiveDigital Interactive
Out-of-HomeOut-of-Home
DirectDirect
OtherOther
Media
![Page 26: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/26.jpg)
3-26
Key Terms_1
Account executive Account planning Account supervisor Advertiser Advertising agency Art directors Art studios Brand manager Business-to-business
agency
Centralized department Classified advertising Cooperative advertising Copy Copywriter Creative boutique Creative director Decentralized system Departmental system
![Page 27: Chapter three The Advertising Industry McGraw-Hill/Irwin Essentials of Contemporary Advertising Copyright © 2007 The McGraw-Hill Companies, Inc. All rights](https://reader035.vdocument.in/reader035/viewer/2022062715/56649da85503460f94a9495c/html5/thumbnails/27.jpg)
3-27
Key Terms_2
Fee-commission combination
Foreign media Full-service agency General consumer
agency Global marketer Group system Incentive system In-house agency
Institutional advertising Integrated marketing
communications Interactive agency International agency International media Local advertising Local agency Management supervisor Markup