chapter4
The Scope of Advertising:From Local to Global
Introduces the people and groups
who work in advertising
Chapter
Copyright © 2008 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/IrwinContemporary Advertising, 11e
4-3
Chapter 4 Objectives
Explain how advertisers organize
Define the main types of ad agencies
Discuss how agencies get clients and make
money
Explain what people do in ad agencies
Debate the pros and cons of in-house
agencies
Examine agency-client relationships
Describe the various groups in advertising
Explain how the media and suppliers help
4-4The Advertising Industry:Organizations
Advertisers (Clients)
Agencies
Media
Suppliers
4-5The Advertising Industry:People
SalesTechnology
Research
Accounting
Communication Arts
Management
Law
Most are employed by advertisers, not clients
4-6Advertisers:Local
Directed to customers in the same geographic area
Independent businesses
Govt. & nonprofits
Franchisees and dealers
Chain retailers
4-7Advertisers:Local
Ad for Rubio’s Baja Grill showcases its unique products
Insert photo 4.2, p. 99
Baja Grill Burrito
Position = 2.9” horiz., 1.5” vertical
Size = 4.6” TALL
Resolution = 300 dpi
4-8Advertisers:Local
Department structure for small advertisers with high volumes of work
Insert ex. 4-1, p. 100
Department structure for small advertisers
Position = 2.9” horiz., 1.5” vertical
Size = 4.6” TALL
Resolution = 300 dpi
4-9
Create favorable image, increase
awareness, foster goodwill
Recruit employees, offer
services, sell merchandise
Regular price-line, sale, or clearance
Advertisers:Local
Types of local advertising
ClassifiedProduct Institutional
4-10Advertisers:Local
Local institutional ad from the Art Center College of Design
Insert photo 4.5, p. 105
Man with child’s bicycle
Position = 2.9” horiz., 1.5” vertical
Size = 4.6” TALL
Resolution = 300 dpi
4-11Advertisers: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
Expand advertising budget
4-12Advertisers:Regional and National
Honda’s national Civic Nation ad
4-13Advertisers:Regional and National
Top 10 advertisers in the U.S. by total U.S. advertising in 2005
Insert ex. 4-2, p. 103
Top 10 U.S. Advertisers
Position = 2.9” horiz, 1.5” vertical
Size = 5.7” WIDE
Resolution = 300 dpi
4-14Advertisers:Regional and National
Regional: one or several states
National: several regionsor entire country
4-15Advertisers:Regional and National
Comparison of national and local advertising
Insert ex. 4-3, p. 104
National and Local Advertising
Position = 2.9” horiz, 1.5” vertical
Size = 5.7” WIDE
Resolution = 300 dpi
4-16Advertisers:Regional and National
Centralized department structure
Insert ex. 4-4, p. 106
Centralized Ad Dept
Position = 2.9” horiz, 1.5” vertical
Size = 5.7” WIDE
Resolution = 300 dpi
4-17
Decentralized department structure
Advertisers:Regional and National
Insert ex. 4-5, p. 107
Decentralized Ad Dept
Position = 2.9” horiz., 1.5” vertical
Size = 4.6” TALL
Resolution = 300 dpi
4-18
Sony’s Walkman targets a specific regional market
Insert photo 4.7, p. 108
Sony Walkman Ad
Position = 2.9” horiz., 1.5” vertical
Size = 4.6” TALL
Resolution = 300 dpi
Advertisers:Regional and National
4-19Advertisers:Transnational
Decentralized international structure
Divisions have ad agencies to handle product lines
Brands within a line handled by own managers
Category managers for brand in each market
4-20Advertisers:Global
Standardized approach in all countries
Extensive research to ensure ad is basic & universal
Centralized global structure
4-21Agencies:Definition
Agencyroles
Develop marketing & ad plans
Develop ads & promotions
Purchase ad space and time
4-22
Agencies
Mad Dogs and Englishmen’s front door doubles asan ad
4-23Agencies:Types
Reach
Full-Service
SpecialtyBoutiques Media
BuyersInteractive
Consumer
BTB
Local National
Regional
Global
Internatl
4-24
Accountmanagement
Research & account planning
Media buying & planning
Production
Creative concepts
Trafficcontrol
Other services
Admin
Agencies:People
4-25Agencies:People
Many departments contributed to Honda’s dealer kit
4-26Agencies:Compensation
Media commissions
Ad ratecard price:
$100,000
Agencybuys adat 15%
discount:$85,000
Agencybills client
full ad amount:$100,000
$15,000difference
is keptby theagency
4-27Agencies:Compensation
Media commissionsMarkups
Agencybuys
materialsfor
campaign
Materialscost
$85,000
Agencybills for
materials plus a
17.65%markup
Agency bills
$100,000which is
costs plus markup
4-28Agencies:Compensation
Media commissionsMarkupsFees
Fee-commissioncombination
Straight-fee(retainer)method
Incentive system
4-29Agencies:In-House
Pros
May save money
Allows tighter control
May permit greater attention to the brand
Lower creative quality
Less experience and talent
Loss of objectivity
Cons
4-30Agencies:Client Relationships
Referrals
Presentations
Community relations& networking
Soliciting fornew business
How agencies reach & attract new clients
4-31
Development
Agencies:Client Relationships
Prerelationship TerminationMaintenance
Stages in the client-agency relationship
4-32
Suppliers
Art studios &web designers
Art studios &web designers
Printers &related specialists
Printers &related specialists
Film & videohouses
Film & videohouses
Researchcompanies
Researchcompanies
4-33
Out-of-home
Media
Digitalinteractive
Electronic
Direct mail
4-34
Mag-Lite adwith globally resonant imagery
Insert photo 4.18, p. 130
Mag-Lite ad
Position = 2.9” horiz, 1.5” vertical
Size = 5.7” WIDE
Resolution = 300 dpi
Media Around the World
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