contemporary advertising 11e chapter 4

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

Print

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