UNIT 2
Advertising agency
Q1) Explain features of ad agency? 5 marks
A1)
Ad Agency
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Features
- Attracting clients – Advertising agency needs client who wants to advertise their products and services. Without the advertiser, it is difficult for the agency to survive.
- Account management – The account manager within the advertising agency is tasked with handling all major decisions related to a specific client. The account manager works closely with the client to develop an advertising strategy.
- Advertising plan - Advertising agency helps in preparing advertising plans and programmes for its clients. Preparing an advertising plan needs coordinated efforts and investigative information. In performing this function, the agency should have full information about the products. It may pertain to
- The product’s positive aspects,
- Past record,
- Its position in the competitive market, and
- Competitors’ negative aspects, strengths and weaknesses.
The advertising agency should assess the present market conditions and the firm’s distribution methods while preparing advertising plans.
4. Creation and execution – The advertising agency prepares advertising plans and is sent to advertiser for approval. Once approved agency will execute the plan. With the suitable media, agency enters into contract for creating an effective advertisement.
5. Co – ordination - Coordination is another important feature of an advertising agency. To ensure long-run success of the advertising programme, ad agency should make sure that a proper coordination between the clients, sales force and the distribution network. The goal of the advertising programme must be to assist the efforts of sales persons, distributors and retailers to maximize sales for the client.
6. Research - Research helps ad agency to make stronger presentation to their clients. It may help the copy and art personnel, to create better advertisements for their clients.
7. Public relation - The fundamental objective of ad agency is to build and maintain goodwill with the cross sections of public. The tools used in communicating with the public are corporate advertising and publicity. The main job of this department is to build stronger relations with clients and the various sections of the public — customers, employees, middlemen and shareholders.
Q2) Explain structure and service offered by ad agency? 8 marks
A2)
Ad Agency
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Structure and services offered
- Contact department - Contact department is also known as client department. They are in charge of keeping contact with their prospective clients (mostly the advertiser) of the advertising agency.
Functions
- Carrying the important information to the clients.
- Efforts for retaining and creating new clients.
- Building the bridge between the advertising agency and the client.
- Helps in boosting revenues.
- Promotion of their agency to create new prospects.
- Efficient working for the quick growth of its organization.
2. Media department - Advertising agency media department is responsible for the choice of media for advertising. This department selects the best suitable medium for the ad agency that will be suitable for its clients.
Function
- It selects and uses the best media possible to communicate the ad message to the ultimate consumers.
- It can also fail, as a wrong selection will result in the failure of the advertised product.
- Preparation of media plans for its clients.
- Media scheduling.
- Supervising the execution.
- It keeps constant contact with the media and the client.
3. Copy department - The copy of the advertising agency is very crucial. It is called the heart of the ad as this conveys a direct message to the consumers creatively.
- Preparing an attractive copy for its clients and customers.
- Participate in brain- storming sessions and come up with ideas.
- While preparing a copy using their extraordinary skills of putting flair and fluent language.
4. Art department - The art department includes of all the artists in an advertising agency. Because of these people in the art department the advertisement finally becomes agreeable and acceptable
- Transform the idea that the client wants to convey, into a simple and beautiful imagery.
- Preparing layouts and visuals for the clients.
- To work closely with the copywriters for developing the visual messages.
- Making painted bulletins, posters, car cards, illustrations, slogans, etc.
5. Production department - The advertisement is sent to the production department for further process, once the art is finalized. The production department takes the advertisement into its final stage. A production manager heads the production department.
- Produces the final advertisements for the markets.
- Making contacts in the industry for the easy carrying out of tasks.
- Assemble the typographic design patterns, engraved photos, illustrations, copy, etc. and prepare the final advertisement.
- Sending the final product to its clients and get the approval.
- Once the approval is received, then it can be sent for final printing or production for the market.
- Keeping them updated about the latest trends and technologies.
6. Research department - The research department in advertising collects information about the market, market competition, market trends, products and services, competitors, consumer behavior, media trends, new trends in advertising, so on.
- Carrying out research and deriving out useful information.
- Critically analyze the information, which they have derived.
- Apply the results in different ways.
- Agency makes use of above information for executing an excellent ad campaign.
- Accounting and finance department - The financial and accounting matters of the organization are taken care by the accounting and finance department of an advertising agency.
- To generate and keep a record of the invoices that the company incurs or gains.
- Sending out regular reminders to the clients for un-cleared payments.
- Clear accounts before or within the due dates.
- Issue payments to vendor parties within or on the due date.
- Keep a track of the monthly and yearly accounts.
- Deposit the government fees on time.
- Manage salary accounts of the employees.
8. Public relation department - The public relations (PR) department main responsibility is to maintain a cordial relationship among three parties, namely, advertising agency, clients, and media.
- Redressing the grievances of the consumers.
- Taking feedback from clients and customers and working on it immediately.
- Serve as a road between the advertising agency and the other parties.
- Maintain a repo, by maintaining the goodwill.
9. Office management – The office management takes care of HR department of the advertising agencies.
- Recruiting the office staff.
- Carrying out training and development of the newly hired staff.
- Carry out promotions of the deserving candidates.
- Provide welfare facilities to staff.
- Filing and record keeping of all the essential documents.
Services offered by the ad agency
The main function of advertising agency is to see that its client‟s advertising leads to greater profits in the long run. The agency thus plans, prepares and places with advertising with the objective. The main function of a full-service advertising agency are as follows :
- Selection of Clients : The first and the foremost function of an advertising agency is to contact and select clients who are desirous of advertising their products, services or anything which they want to sell. The preference in contacting and choosing the clients is given to those firms which have sound values, able management, efficient operative products and services. The financial position, size and nature of business, efficient management and operative products etc. must be given due weight.
- Media Selection: Media selection is another major function of the advertising agency. In making a media selection several factors such as cost, circulation, population which it serves, audiences, nature of the product, types of customers and above all needs of the clients should be kept in mind.
3. Advertising Planning: The third as well as the major function of advertising agency is the advertising planning for its clients. For this purpose, the advertising agency requires a detailed knowledge of the firm‟s products, its advertising history, market conditions, channel of distribution, knowledge of competitors‟ products and their advertising techniques, field to be covered, nature and type of consumers etc. Next planning job is to decide about the advertising medium in which the advertisement is to appear. The advertising message must be adapted to the medium in which it is to appear.
4. Advertising Planning: The third as well as the major function of advertising agency is the advertising planning for its clients. For this purpose, the advertising agency requires a detailed knowledge of the firm‟s products, its advertising history, market conditions, channel of distribution, knowledge of competitors‟ products and their advertising techniques, field to be covered, nature and type of consumers etc. Next planning job is to decide about the advertising medium in which the advertisement is to appear. The advertising message must be adapted to the medium in which it is to appear.
5. Research Function: It is the fifth major function of an advertising agency. It supports the decisions taken in the media and creative areas. In this connection the advertising agency gathers and analyse actual information about the product, extent of market, competitors‟ strategies and buyers‟ habits etc. that may help the creative personnel to make the advertising copy more attractive and effective
6. Approval of the Client: As soon as the advertising copy etc. are prepared, the next function of the advertising agency is to show the copy to his client and obtain his approval. In case if any changes are suggested by the client, the same may be incorporated and thus the final approval should be taken from the client.
7. Marketing Function: The advertising agency also performs marketing functions such as selecting target consumers, designing products and packages, developing channels of distribution strategy, determining prices and rate of discount etc. It gives useful advice to its clients with regard to the nature and trend of the market conditions. Accordingly, the client produces goods keeping in his mind the prevailing conditions in the market.
8. Evaluation Function: Simply drafting advertising copy and handing over the same to the media is not enough. The next major function of the advertising agency is to have an exhaustive evaluation of the advertising effects for the benefit of his client. In case of any deficiency, necessary suggestions should be given and the same be made effective after approval of the client.
9. Coordination Function: The last but not the least important function of the advertising agency is to establish effective coordination with client‟s sales force and distribution network to ensure the long running success of the advertising campaign. Each time the advertising agency contacts the client regarding advertising media to be used and the number of times the advertisement is to be repeated after giving effect to changes, if any, as suggested by the advertiser
Q3) Explain types of ad agency? 8 marks
A3)
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Importance of ad agency
1. Nature of Product-
This is the first importance and it means when the product is a form of mass media then advertising agency can use print media while when the producers want a demonstration that screen and television advertising can be used.
At the time of advertisement, the nature of a product plays a very effective role because it helps to define the target audience related to their product which is sold in the world.
2. Advertising Budget-
This is the second important and it means that the choice of advertising agency rest on advertising budget since a large organization can only bear the expenses of an advertising agency. Thus, the advertising budget defines the estimation of total expenses which are related to the advertisement.
It includes various estimations regarding their budget control system like it includes expenditure relating to advertising programme, advertising material, media expenses, and so on.
3. Potential Market-
This is the third importance and it means an advertising agency has to conduct the market surveys and identify the changes in consumer preferences so that these agencies can satisfy the consumers in a proper manner. Thus, the potential market produces potential customers.
4. Reputation of Agency-
This is the fourth importance and it means that the reputation of the agency attracts the companies to higher than for various purposes such as copywriting or media planning. Agencies like mudra are employed by large organizations.
5. Selling Message-
This is the fifth importance and it means that the selling message that is used by the companies can be employed by the advertising agencies in order to gain the attention of the consumers. It can be an emotional message or rational.
6. Media Alternatives Available-
The advertising agency has to decide which media alternatives are available in the branding of a regular product. For Example– If a company wants to advertise a product on T.V. Then the timeslot should be available.
Types of advertising agencies
- In house agencies –
- In large organization, there may be a separate whole department devoted to advertisement headed by advertisement manager reporting to marketing manager, who in turn reports to top management.
- In small firms, there may be a person looking after the advertisement tasks and reporting to the top management. The advertiser has many advantage of in –house agency.
- They are the own personnel and their time can be efficiently utilized for better coordination and control in the advertisement process.
- Further, they know the present marketing strategies and have control over distribution tactics. It also leads to cost saving in terms of commission saved by the advertiser to the external agency.
2. Full service agency –
- A Full service agency offers full range of communication and promotion services to their clients. It performs research on behalf of advertiser and offer creative and media services to their clients.
- They also offer to prepare an integrated marketing communication campaign to coordinate all the promotional tools.
- They are therefore known for providing both advertising and non-advertising services. The range of services provided by them include planning, creating, producing, performing research, buying media, copywriting, artwork, media planning in the nature of advertising services and pricing
- Specialized service agency –
- With the growth in the need of advertising agencies and its specialized services, many advertising agencies have come up that do not provide full range of services but specialize in one or the other services only.
- They provide their expert services to either the advertiser or other ad agencies.
- The advertising agencies that restrict and specialize in niche areas like: consumer durable, domestic market, local market or only regional languages are called specialized agencies.
- For example, Soubhagya advertising agency specializes in financial advertising only.
Types of specialized service agencies
- Creative boutiques - They include few people ranging from two or three to a dozen or so and include artists, designers, and copywriters. They offer creative and artistic services and unlike full service agencies. They do not involve themselves in strategic planning, target audience etc. Their focus is only on the development of a creative idea into the message theme.
b. Media buying services - Media agencies have gained high growth in the last few decades and have become major players on the advertising stage.A media buying agency is not only responsible for booking the space and time for their clients, but are also responsible for providing market research and analysis and guiding them with respect to ideal space and time for their advertisement.
c. Interactive agencies - The interactive agencies have come up with the growth of Internet technology and the need for integrated marketing communications.
d. Direct response agencies - The direct response advertising agencies offer specialized services to the clients and help them integrate advertising through various mediums like television, print, radio, online etc. The growth of direct marketing has led to the growth of direct response agencies.
e. Sales promotion agencies - These agencies specialize in providing services of designing sales promotional programs, identifying suitable sales promotional tools, carrying pre-sales promotion evaluation, executing the sales promotion program, performing post-test for evaluating effectiveness of sales promotional tools.
f. Public relations firms - These firms specialize in providing services that enhance the goodwill and image of the clients’ companies amongst its publics, namely, employees, labor groups, suppliers, government and other stakeholders.
Q4) Explain agency selection criteria? 8 marks
A4)
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Advertising selection criteria
Following are some points to be taken in account while selecting the advertising agency:
- Suitability: The advertising agency which suits the requirement of manufacturer or trader is selected depending upon the type of advertisement, location of agency, credit policies, etc. Normally, an agency which is located near the advertisers place is selected. This helps in approaching the agency. Secondly, the size of agency in terms of personnel, projects, and services provided is considered. Thirdly, the connections and relations with the various media. Fourthly, the policies like conservative policy, outgoing policies etc. are taken into account. Finally, the advertising also considers whether the agency has competitors account or not.
- Facilities and Services Provided: Some agencies have modern facilities of photography, type setting, printing, filming etc. The agencies which provide maximum services with minimum costing preferred.
- Imagination: Imaginations and creative skills of the personnel of agency is duely considered. Creativity in photography, layout, copy writing, media etc. creates an identity and unique for the products and services of the advertiser.
- Past Record: Past records of the agency in terms of number of clients, effectiveness, credit reputation etc. helps in selecting the agency. The advertiser enquires about the agency‟s timeliners, punctuality, past record helps to show whether the agency is reliable or not.
- Reputation: The reputation of the advertising agency helps in selection. The popularity of the agency depends upon timeliners, successful presentation, good relations, prompt services etc.
- Management: Proper selection of advertising agency depends on the ownership and management and their policies. Their policies may be either conservative or dynamic which influence the selection
- Rates Charged: The advertiser considers the rates charged by the agency. Normally, the rates depend on reputation, facilities provided techniques adopted etc. Therefore, an advertiser will select such agency which will provide facility according to his requirement and which suits its budget.
- Size of the Agency: The size of the advertising agency must be considered. The larger the size, the more it is preferred, however, at times, small is beautiful because a small agency may give more attention to its client‟s work.
Q5) Explain client agency relationship? 8 marks
A5)
Maintaining Agency–Client relationship
The client-agency relationship starts when a client appoints an advertising agency for making his ad. It continues till the ad agency provides satisfactory services to the client. Such a relation should always be affable. Between the two parties there should be a mutual trust, confidence and understanding. The primary objective of both the parties is to make a successful advertising campaign.
Lack of mutual trust will be harmful to both parties. It is, thus, necessary to maintain good relations between the client and ad agency as follows:
- To maintain a friendly client-agency relationship meaningful two-way communication is required.
- To maintain a cordial relationship both parties should take special efforts.
- The approach of give-and-take is required to keep relations over a longer period.
Guidelines to maintain a cordial relationship between clients and ad agency.
- Suggestions for both parties (Client and Ad Agency).
- Guidelines for the Client (Advertiser), and
- Advice to the Advertising Agency.
Suggestions for a client and advertising agency to maintain their relations:
- There should be a mutual understanding between client and agency. Misunderstanding between the two parties through direct talks should be resolved quickly.
- The agency should work sincerely and honestly to bring a success to the client's ad campaign.
- Both parties should properly follow the terms and conditions of the contract.
- Good communication must be there between client and agency. Hence, regular meetings between them shall be arranged.
- Both should take necessary efforts to maintain their relations friendly.
Guidelines for the client to preserve relationship with advertising agency:
- Treat the ad agency with courtesy at all times and never hurt its ego.
- Provide all possible information about the product to be advertised and the organisation. A well-informed ad agency will make better ads.
- Don't unnecessarily bargain for the fees charged by the ad agency as this may affect the quality of work.
- Motivate the agency to do a good impactful work. Its charges such as media bills, fees and other costs must be paid well in time.
- Don't change the ad agency without a proper reason. If not satisfied, always first communicate your expectations and then wait for necessary changes to reflect.
- The client should approve the proposals submitted by the ad agency. He must avoid making small arguments and only highlight those crucial relevant matters that needs attention.
- Give sufficient time to the agency to work on and develop an ad campaign. The client should not pressurize it to work quickly. He should avoid giving deadlines.
- Reduce disputes to a minimum.
- Finalize in advance the charges for a particular ad campaign.
Advice to the advertising agency to maintain good relationship with client:
- The advertising agency should do a smart and hard work to bring success to the client's ad campaign.
- It should make a good advertising plan and must implement it efficiently and effectively. However, first it must get the approval from the client.
- It is the duty of the account executive of the agency to keep his customer happy and satisfied.
- It should not charge client unreasonably high rates.
- It should not make ads for client's competitor.
- It should get all the information from the market that will help to create better ads.
- Discuss the ad fees with the client in advance to avoid disputes.
- Disclose to the client the names of the team members (employees) that are working on his ad campaign.
- Inform the client about changes, if any, happening within the agency.
- Agency should always provide timely services to the client and try its best to satisfy him.
Q6) Explain reasons and ways of avoiding client turnover? 5 marks
A6)
Ad Agency
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Reasons for client turnover
- Poor quality of services – If the client becomes dissatisfied with the quality of advertising provided by the agency, then the client may leave the existing agency and look for another agency which provides better service.
2. Frequent personnel changes in staff – Clients sometimes switches over to new agencies when the creative team of existing agency moves out to another agency.
3. Lack of coordination – Sometimes key official of the company and agency personnel find it very difficult to coordinate the work. If both the parties have issue then the relationship breaks down for the worst.
4. Dearth of confidence – When the client losses the confidence of his agency in the delicate area, like fairness, etc
5. Change for the sake of change – When changes become the essence of life. Man goes on changing simply for the sake of change. According to clients change result better result.
6. Non availability of services – If the present agency cannot render the service required by the client, then the client will join another ad agency.
7. Personal conflict – Sometimes advertisement are perceived in a different manner by the client and the ad agency. Top executive of client and agency may have conflict regarding decision of advertising campaign like copy writing, selection of media, etc.
Ways for avoiding client turnover
The relationship between a client and its fundraising agency can be a critical factor in determining the success of the client's fundraising work. A close relationship in which everyone feels part of the same team can not only help both parties to produce better fundraising materials and get better results, but it can also make the whole process of developing the appeals more efficient and enjoyable.
The ultimate aim of the team that is created by the client and agency working together is to raise as much money as possible, so that the charity can pursue its social aims.
Each of the priorities below are important means towards this overall end:
Understanding- both parties make the effort to understand how the other works.
Trust- both parties trust each other and work to maintain that trust - including Communicating well, meeting deadlines and agreeing fair pricing.
Flexibility- there is space in the relationship for both parties to suggest new ideas, Adjust things and improve things.
Respect- both parties respect the views, competence and situation of the other,and communicate in a respectful way.
Shared responsibility- in the best client/agency relationships, both parties will feel an equal sense of responsibility and commitment to the work they are producing.
Q7) Explain creative pitch? 5 marks
A7)
Creative pitch
Definition
A pitch is how an advertising agency proposes marketing ideas for a brand, product, or service to a prospective client. An ad agency pitch should present the agency’s marketing strategy in a creative way and express how their marketing efforts will accomplish the client’s goals and deliver the brand’s message.
Steps
1. Set the pitch meeting - A client often initiates an agency pitch meeting by sending out a request for proposal (RFP). The RFP provides a concise overview of the information through which agency needs to decide whether or not to pitch. If the agency accept the pitch request, the client sets a meeting time.
2. Prepare and rehearse – The agency should research every detail of the client’s creative brief. The more informed , the better chances of getting hired. Understand the client’s goals and potential customers, then practice the pitch. If the agency work hard during preparation time, you’ll deliver a better pitch.
3. Make the introduction – The agency should start a pitch meeting by thanking the client for meeting with you, then introduce them with your team members, especially if the agency is new and haven’t worked with them previously. After the introduction, provide a concise overview of the marketing campaign’s objectives.
4. Present the market research and case studies - The agency should walk the potential client through the research that your agency has conducted on the target audience, and clarify which ad platforms you plan to use.
5. Present your creative content- It’s time to show off all your creative ideas. Make sure to create dummy of your campaign proposals in the same medium that they would actually appear. For example, if your ad will be distributed through digital content marketing, then display it on an actual website or on its intended social media platform.
6. Go over the budget- The agency should show the details of expected budget for the client campaign, including both the cost of creative agency and the anticipated cost of the media agency who will take care of getting the ads out into the world.
7. End on a memorable note - Clearly summaries the essence of the campaign in a captivating way. Ask the client if they have any questions and thank them for inviting you to pitch. Making a good impression sets you up for future success.
Q8) Explain Skills required for a career in advertising? 5 marks
A8)
Every profession including advertising needs appropriate skills to be successful. Advertising people need a several skills to be effective and successful not only in the short-term but in the long-term as well
Skills required for a career in advertising
1. People Skills: In the field of advertising it is very important to have people skills. Every day one has to deal with a number of people and how well one deals with them, determines their worth as an employee. This is an art to be build and should be learnt consistently.
2. Sales Skills: The whole purpose of advertising is to sell. The sales are largely affected by the advertisements. Hence the people in this field must have the sense of how sales take place and what factors affect them. Eventually all the advertisements come down to selling a product or a service.
3. Communication Skills: Advertising is all about communicating. In an advertisement each sentence, each word has its own significance. Therefore it is very important for an advertiser to express themselves clearly and communicate effectively.
4. Creative Skills: High levels of creativity is demanded in advertising and thus one has to stay creative and bring in a number of ideas to the project. The important phase of any advertisement is idea generation and creativity is tested during this phase.
5. Analytical Skills: Medium levels of analytical skills will be required. Before making their plans they have to look for the patterns and analyze the data and therefore this skill also holds relevance.
6. Technical Skills: Advertisers now a days need to have reasonable understanding of the technology that could save their time, energy and effort. The role of technology is improving day by day and the right use of it will help the advertisements do wonder with their audience.
Q9) Explain Various Career Options in advertising? 8 marks
A9)
Various Career Options
Some of the career options in advertising related areas are:
- Advertising agency - All over the world, advertising continues to be one of the most sought-after careers. Graduates and even undergraduates with diploma in computers, secretarial course, art-work etc., can hope to start career in advertising.
Advertising Agencies: The agencies are the most visible face of advertising, and the natural first choice of someone planning a career. In an ad agency, one can try out in the following areas:
- Copywriters: Candidates with good communication skills stand a fair chance to be copywriters. One needs a good background of literature and business communication. Intelligence, visualising power and creative thinking are good qualities required by copywriters.
- Artists: Agencies also employ a good number of artists on regular basis and on contract basis. Candidates with a diploma and / or natural talent in art work can qualify for the job of artists.
- Visualizers: Today, visualizing has become a specialized function. Those who can generate creative ideas can qualify for the job of visualizing.
- Production Work: The production department looks after the mechanical production of the ads. This includes typo-graphing, photoengraving, printing, etc. Normally actual production is undertaken on job or contract basis. However, there is lot of administrative work in the production department, to monitor final production of the ad.
- Account Executives: A very important job is handled by account executives. They act as liaison between the client and the agency. Their job is to keep good client relations.
- Media Planners: They look after the planning and selection of media, booking time and space in the media and preparation of ad budget. Commerce graduates with computer background and / or knowledge of statistics do stand a fair chance of getting the job of media planners.
2. Advertising media - The media employs large numbers of people to work in their advertising departments. Selling time and space and monitoring the running of advertisements could be the major jobs. Audience or readership research could be another major function. One can do liaison work with sponsors, advertisers, or ad agencies. Some media companies provide marketing service to advertisers. At present, media industry is not restricted to one field. Instead, it includes broadcasting – television, radio, online media, and print media – newspapers, magazines, books, journals, etc. All the fields have witnessed incredible growth.
3. Supplying / supporting firms –
- Production houses - Production houses undertake the production of ads, films, serials, documentaries, etc. Some of the production houses include SRK Productions, Balaji Tele Films, Yash Raj Film Studio, Galaxy, Sai Production, Prime Focus, Lemon Tree and several others.
- Market research - Market research involves collection, and analysis of data about market and customers to take marketing decisions, including advertising decisions. Market research has various elements including customer analysis, competitor analysis, risk analysis, product research, advertising research, etc.
- Printing - The Indian printing industry experienced a major technology upgrade in the late 1990s with the electronics and InfoTech revolutions completely changing the image and profile of the industry. Job opportunities are plenty for qualified diploma holders as the printing industry is growing all over India with Mumbai along having about 500 to 600 printing houses and more than 100 processing units. Among the major employers are advertising agencies, the media, and print companies. The largest employer is the government which has printing presses across the country.
- Graphic and animation - Graphic designing is a process of communication through visuals. A graphic designer uses words, images, videos, pictures and graphics to convey any idea or message to the audience. A professional graphic designer creates a layout and design for any print media organization – newspaper, magazine, journal and any other publications. Animation industry in India is growing at a fast pace. Animation is emerging as a vital component of computerized games, video technology, big budget and feature films. The animation industry has got a boost due to the convergence of the Internet and media technologies. Visualization and audio techniques are increasingly being used to interact and produce sophisticated computerized games, ad films, and motion pictures.
- Modeling - Models in advertising promote products or services, so as to create interest on the part of target audience. The goods promoted by models include household items, food items, health tonics, personal care items, etc. The information provided by models facilitates consumer buying decision.
- Voice over – dubbing - A voice-over artist is a person, who lends his / her voice to complement visuals being telecast on the screen. Voice-over can be considered as off-camera commentary. It is a technique wherein voice is modulated in order to be broadcast along with the visuals of the tele film, documentary, advertisement, television serial or news. Radio also makes use of voice-over artists to convey important messages.
Q10) Explain freelancing career option? 5 marks
A10)
Freelancing Career Options
Freelancing is a good option for persons wanting to earn a flexible income and to work from home. The popularity of freelancing stems from the fact that it allows you to work at your own time and pace and place. In advertising, freelancing can be done for copywriting, artwork (including graphics and animation), filming the ad, ad research, and so on. Freelancing is a good choice for those of you who do not want to be bound by one boss and a monotonous job.
Following are some tips that will open doors to a host of freelancing opportunities:
- Discover your area of interest and proficiency: Before making a start at freelancing, identify your area of interest as well as expertise. Many of you are capable of penning down your thoughts well. You can consider being freelance copy writing as an option. Freelance photography or filming is also an excellent option. Some may be god at research work.
- Approach the right people: After having identified the area you want to get into, it is important to let people know about it. It is only through adequate networking that you get freelancing opportunities. It takes a lot of patience to do so but once you made the right contacts, you get good opportunities. To be a freelancer, it is very important to promote yourself outside. This can be done by contacting the ad agencies where your friends or relatives work.
- Use Social Media: Social media is also a great tool for networking: Social networking sites like Twitter, Linkedin, YouTube and Facebook are very popular and can be used to find opportunities. Set up your account, make contacts and interact with them. You may be able to attract films looking for freelancers.
- Emailing: You can get in touch with multiple companies direct through e mails. You can compose a message to them, write about what you are looking for and send it. You may also compose some headlines or taglines for certain products and mail it to them. This is a quick and easy way of contacting professionals.
- Search Online: Using search engines on the internet are one of the most common ways to find companies hiring freelancers. The internet will give you a list of places you can consider working for. Now-a-days, organizations create websites which offer such opportunities.
- Price Your Service: Since your services are valuable, you must take to price it appropriately. Learning to make money is a core freelance skill. One of the basics while pricing is to know your experience and level f expertise. As a beginner, you would be expected to charge slightly lower rates but as you go higher up in terms of experience and work, you can gradually increase the rates. Always think long term while pricing your services.
Q11) Explain service offered by ad agency? 8 marks
A11)
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Importance of ad agency
1. Nature of Product-
This is the first importance and it means when the product is a form of mass media then advertising agency can use print media while when the producers want a demonstration that screen and television advertising can be used.
At the time of advertisement, the nature of a product plays a very effective role because it helps to define the target audience related to their product which is sold in the world.
2. Advertising Budget-
This is the second important and it means that the choice of advertising agency rest on advertising budget since a large organization can only bear the expenses of an advertising agency. Thus, the advertising budget defines the estimation of total expenses which are related to the advertisement.
It includes various estimations regarding their budget control system like it includes expenditure relating to advertising programme, advertising material, media expenses, and so on.
3. Potential Market-
This is the third importance and it means an advertising agency has to conduct the market surveys and identify the changes in consumer preferences so that these agencies can satisfy the consumers in a proper manner. Thus, the potential market produces potential customers.
4. Reputation of Agency-
This is the fourth importance and it means that the reputation of the agency attracts the companies to higher than for various purposes such as copywriting or media planning. Agencies like mudra are employed by large organizations.
5. Selling Message-
This is the fifth importance and it means that the selling message that is used by the companies can be employed by the advertising agencies in order to gain the attention of the consumers. It can be an emotional message or rational.
6. Media Alternatives Available-
The advertising agency has to decide which media alternatives are available in the branding of a regular product. For Example– If a company wants to advertise a product on T.V. Then the timeslot should be available.
Services offered by the ad agency
The main function of advertising agency is to see that its client‟s advertising leads to greater profits in the long run. The agency thus plans, prepares and places with advertising with the objective. The main function of a full-service advertising agency are as follows :
- Selection of Clients : The first and the foremost function of an advertising agency is to contact and select clients who are desirous of advertising their products, services or anything which they want to sell. The preference in contacting and choosing the clients is given to those firms which have sound values, able management, efficient operative products and services. The financial position, size and nature of business, efficient management and operative products etc. must be given due weight.
2. Media Selection: Media selection is another major function of the advertising agency. In making a media selection several factors such as cost, circulation, population which it serves, audiences, nature of the product, types of customers and above all needs of the clients should be kept in mind.
3. Advertising Planning: The third as well as the major function of advertising agency is the advertising planning for its clients. For this purpose, the advertising agency requires a detailed knowledge of the firm‟s products, its advertising history, market conditions, channel of distribution, knowledge of competitors‟ products and their advertising techniques, field to be covered, nature and type of consumers etc. Next planning job is to decide about the advertising medium in which the advertisement is to appear. The advertising message must be adapted to the medium in which it is to appear.
4. Advertising Planning: The third as well as the major function of advertising agency is the advertising planning for its clients. For this purpose, the advertising agency requires a detailed knowledge of the firm‟s products, its advertising history, market conditions, channel of distribution, knowledge of competitors‟ products and their advertising techniques, field to be covered, nature and type of consumers etc. Next planning job is to decide about the advertising medium in which the advertisement is to appear. The advertising message must be adapted to the medium in which it is to appear.
5. Research Function: It is the fifth major function of an advertising agency. It supports the decisions taken in the media and creative areas. In this connection the advertising agency gathers and analyse actual information about the product, extent of market, competitors‟ strategies and buyers‟ habits etc. that may help the creative personnel to make the advertising copy more attractive and effective
6. Approval of the Client: As soon as the advertising copy etc. are prepared, the next function of the advertising agency is to show the copy to his client and obtain his approval. In case if any changes are suggested by the client, the same may be incorporated and thus the final approval should be taken from the client.
7. Marketing Function: The advertising agency also performs marketing functions such as selecting target consumers, designing products and packages, developing channels of distribution strategy, determining prices and rate of discount etc. It gives useful advice to its clients with regard to the nature and trend of the market conditions. Accordingly, the client produces goods keeping in his mind the prevailing conditions in the market.
8. Evaluation Function: Simply drafting advertising copy and handing over the same to the media is not enough. The next major function of the advertising agency is to have an exhaustive evaluation of the advertising effects for the benefit of his client. In case of any deficiency, necessary suggestions should be given and the same be made effective after approval of the client.
9. Coordination Function: The last but not the least important function of the advertising agency is to establish effective coordination with client‟s sales force and distribution network to ensure the long running success of the advertising campaign. Each time the advertising agency contacts the client regarding advertising media to be used and the number of times the advertisement is to be repeated after giving effect to changes, if any, as suggested by the advertiser.
Q12) Explain ad agency in details with features? 8 marks
A12)
Ad Agency
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Importance of ad agency
1. Nature of Product-
This is the first importance and it means when the product is a form of mass media then advertising agency can use print media while when the producers want a demonstration that screen and television advertising can be used.
At the time of advertisement, the nature of a product plays a very effective role because it helps to define the target audience related to their product which is sold in the world.
2. Advertising Budget-
This is the second important and it means that the choice of advertising agency rest on advertising budget since a large organization can only bear the expenses of an advertising agency. Thus, the advertising budget defines the estimation of total expenses which are related to the advertisement.
It includes various estimations regarding their budget control system like it includes expenditure relating to advertising programme, advertising material, media expenses, and so on.
3. Potential Market-
This is the third importance and it means an advertising agency has to conduct the market surveys and identify the changes in consumer preferences so that these agencies can satisfy the consumers in a proper manner. Thus, the potential market produces potential customers.
4. Reputation of Agency-
This is the fourth importance and it means that the reputation of the agency attracts the companies to higher than for various purposes such as copywriting or media planning. Agencies like mudra are employed by large organizations.
5. Selling Message-
This is the fifth importance and it means that the selling message that is used by the companies can be employed by the advertising agencies in order to gain the attention of the consumers. It can be an emotional message or rational.
6. Media Alternatives Available-
The advertising agency has to decide which media alternatives are available in the branding of a regular product. For Example– If a company wants to advertise a product on T.V. Then the timeslot should be available.
Features
- Attracting clients – Advertising agency needs client who wants to advertise their products and services. Without the advertiser, it is difficult for the agency to survive.
2. Account management – The account manager within the advertising agency is tasked with handling all major decisions related to a specific client. The account manager works closely with the client to develop an advertising strategy.
3. Advertising plan - Advertising agency helps in preparing advertising plans and programmes for its clients. Preparing an advertising plan needs coordinated efforts and investigative information. In performing this function, the agency should have full information about the products. It may pertain to
- The product’s positive aspects,
- Past record,
- Its position in the competitive market, and
- Competitors’ negative aspects, strengths and weaknesses.
The advertising agency should assess the present market conditions and the firm’s distribution methods while preparing advertising plans.
4. Creation and execution – The advertising agency prepares advertising plans and is sent to advertiser for approval. Once approved agency will execute the plan. With the suitable media, agency enters into contract for creating an effective advertisement.
5. Co – ordination - Coordination is another important feature of an advertising agency. To ensure long-run success of the advertising programme, ad agency should make sure that a proper coordination between the clients, sales force and the distribution network. The goal of the advertising programme must be to assist the efforts of sales persons, distributors and retailers to maximize sales for the client.
6. Research - Research helps ad agency to make stronger presentation to their clients. It may help the copy and art personnel, to create better advertisements for their clients.
7. Public relation - The fundamental objective of ad agency is to build and maintain goodwill with the cross sections of public. The tools used in communicating with the public are corporate advertising and publicity. The main job of this department is to build stronger relations with clients and the various sections of the public — customers, employees, middlemen and shareholders.
Q13) Explain the importance and features of ad agency? 8 marks
A13)
An advertising agency is an independent company composed of creative and business people who provide specialized services in advertising in particular and in marketing in general.
A firm engaged in providing services of advertisement for clients to create awareness and market for them is known as advertising agency. These agencies involve people with specialized skills and knowledge who are well versed in marketing, advertising and consumer behavior.
The advertising agency carry out the activity on behalf of their client against remuneration called fees. They conduct market research, consumer research, product research etc. They advice the manufacturer on product design or package design, pricing of product channels of distribution. Besides, they advice on the market condition from time to time.
Advertising agency conduct the production activities of visualization, layout, illustration, headlines, copy etc. They also help in the selection of proper media and the frequency at which the advertisement should be presented.
Thus, the advertising agency relieves the burden of the trader or manufacturer of the responsibility of advertising, production and distribution.
Definition
According to American Association of Advertising Agency an advertising agency is one –
i. Which is an independent organization.
Ii. Which is composed of creative and business people.
Iii. Who develop, prepare and place advertisements in media.
Iv. Which is for sellers seeking to find customers for their goods and services.
Philip Kotler opines that “Advertising agency is a marketing service firm that assists its clients in planning, preparing, implementing and evaluating various activities of advertising campaign.”
Importance of ad agency
1. Nature of Product-
This is the first importance and it means when the product is a form of mass media then advertising agency can use print media while when the producers want a demonstration that screen and television advertising can be used.
At the time of advertisement, the nature of a product plays a very effective role because it helps to define the target audience related to their product which is sold in the world.
2. Advertising Budget-
This is the second important and it means that the choice of advertising agency rest on advertising budget since a large organization can only bear the expenses of an advertising agency. Thus, the advertising budget defines the estimation of total expenses which are related to the advertisement.
It includes various estimations regarding their budget control system like it includes expenditure relating to advertising programme, advertising material, media expenses, and so on.
3. Potential Market-
This is the third importance and it means an advertising agency has to conduct the market surveys and identify the changes in consumer preferences so that these agencies can satisfy the consumers in a proper manner. Thus, the potential market produces potential customers.
4. Reputation of Agency-
This is the fourth importance and it means that the reputation of the agency attracts the companies to higher than for various purposes such as copywriting or media planning. Agencies like mudra are employed by large organizations.
5. Selling Message-
This is the fifth importance and it means that the selling message that is used by the companies can be employed by the advertising agencies in order to gain the attention of the consumers. It can be an emotional message or rational.
6. Media Alternatives Available-
The advertising agency has to decide which media alternatives are available in the branding of a regular product. For Example– If a company wants to advertise a product on T.V. Then the timeslot should be available.
Features
- Attracting clients – advertising agency needs client who wants to advertise their products and services. Without the advertiser, it is difficult for the agency to survive.
- Account management – the account manager within the advertising agency is tasked with handling all major decisions related to a specific client. The account manager works closely with the client to develop an advertising strategy.
- Advertising plan - Advertising agency helps in preparing advertising plans and programmes for its clients. Preparing an advertising plan needs coordinated efforts and investigative information. In performing this function, the agency should have full information about the products. It may pertain to
- The product’s positive aspects,
- Past record,
- Its position in the competitive market, and
- Competitors’ negative aspects, strengths and weaknesses.
The advertising agency should assess the present market conditions and the firm’s distribution methods while preparing advertising plans.
4. Creation and execution – the advertising agency prepares advertising plans and is sent to advertiser for approval. Once approved agency will execute the plan. With the suitable media, agency enters into contract for creating an effective advertisement.
5. Co – ordination - Coordination is another important feature of an advertising agency. To ensure long-run success of the advertising programme, ad agency should make sure that a proper coordination between the clients, sales force and the distribution network. The goal of the advertising programme must be to assist the efforts of sales persons, distributors and retailers to maximize sales for the client.
6. Research - Research helps ad agency to make stronger presentation to their clients. It may help the copy and art personnel, to create better advertisements for their clients.
7. Public relation - The fundamental objective of ad agency is to build and maintain goodwill with the cross sections of public. The tools used in communicating with the public are corporate advertising and publicity. The main job of this department is to build stronger relations with clients and the various sections of the public — customers, employees, middlemen and shareholders.
Q14) Explain agency – client relationship and agency compensation? 12 marks
A14)
Maintaining Agency–Client relationship
The client-agency relationship starts when a client appoints an advertising agency for making his ad. It continues till the ad agency provides satisfactory services to the client. Such a relation should always be affable. Between the two parties there should be a mutual trust, confidence and understanding. The primary objective of both the parties is to make a successful advertising campaign.
Lack of mutual trust will be harmful to both parties. It is, thus, necessary to maintain good relations between the client and ad agency as follows:
- To maintain a friendly client-agency relationship meaningful two-way communication is required.
- To maintain a cordial relationship both parties should take special efforts.
- The approach of give-and-take is required to keep relations over a longer period.
Guidelines to maintain a cordial relationship between clients and ad agency
- Suggestions for both parties (Client and Ad Agency).
- Guidelines for the Client (Advertiser), and
- Advice to the Advertising Agency.
Suggestions for a client and advertising agency to maintain their relations:
- There should be a mutual understanding between client and agency. Misunderstanding between the two parties through direct talks should be resolved quickly.
- The agency should work sincerely and honestly to bring a success to the client's ad campaign.
- Both parties should properly follow the terms and conditions of the contract.
- Good communication must be there between client and agency. Hence, regular meetings between them shall be arranged.
- Both should take necessary efforts to maintain their relations friendly.
Guidelines for the client to preserve relationship with advertising agency:
- Treat the ad agency with courtesy at all times and never hurt its ego.
- Provide all possible information about the product to be advertised and the organisation. A well-informed ad agency will make better ads.
- Don't unnecessarily bargain for the fees charged by the ad agency as this may affect the quality of work.
- Motivate the agency to do a good impactful work. Its charges such as media bills, fees and other costs must be paid well in time.
- Don't change the ad agency without a proper reason. If not satisfied, always first communicate your expectations and then wait for necessary changes to reflect.
- The client should approve the proposals submitted by the ad agency. He must avoid making small arguments and only highlight those crucial relevant matters that needs attention.
- Give sufficient time to the agency to work on and develop an ad campaign. The client should not pressurize it to work quickly. He should avoid giving deadlines.
- Reduce disputes to a minimum.
- Finalize in advance the charges for a particular ad campaign.
Advice to the advertising agency to maintain good relationship with client:
- The advertising agency should do a smart and hard work to bring success to the client's ad campaign.
- It should make a good advertising plan and must implement it efficiently and effectively. However, first it must get the approval from the client.
- It is the duty of the account executive of the agency to keep his customer happy and satisfied.
- It should not charge client unreasonably high rates.
- It should not make ads for client's competitor.
- It should get all the information from the market that will help to create better ads.
- Discuss the ad fees with the client in advance to avoid disputes.
- Disclose to the client the names of the team members (employees) that are working on his ad campaign.
- Inform the client about changes, if any, happening within the agency.
- Agency should always provide timely services to the client and try its best to satisfy him.
Agency compensation
The agency’s compensation level depends upon how well they meet the predetermined performance goals for its clients such as sales or market share.
Agency agencies may be compensated in a variety of ways including:
- Commission methods - Based on the time or space it purchases for its client the agency is compensated. The commission has traditionally been 15% (16 2/3% for outdoor) but now is often negotiated downward. Many advertisers have moved to a negotiated commission system including variable commission rates and minimum and maximum compensation rates.
For example, an advertising agency places a full age advertisement in a magazine at an agreed charge of Rs. 50,000. The magazine will bill the agency for Rs. 50,000 less 15% i.e., Rs. 42,500 net. The advertising agency will bill the advertiser for Rs. 50,000 (cost of advertisement charged by the media). Thus the difference of Rs. 7,500 will be treated as the remuneration of the advertising agency. Generally, a cash discount @ Rs. 2% is also offered by the media for prompt payment within a stated period. This cash discount is usually passed on to the advertiser on similar terms by the advertising agency. The general criticism of this method is that the advertising agency is always tempted to recommend expensive media in order to draw a higher remuneration.
2. Fixed fee method - The agency charges a basic monthly fee for all of its services and credits to the client refers to fixed fee method.
Under a fee-commission combination, the media commissions received by the agency are credited against the fee. If commissions are less than the agreed-on fee, the client must make up the difference. Under fee system, the agency payment consists only the service charges which are to be computed on the basis of cost plus system. Under the system a certain fixed percentage (flat rate) on cost may be charged from the client as fee to be paid to the agency along with the bill. This system enables the advertising agency to make fair profits on services rendered by it and, in turn, the advertiser pays for what he gets - nothing more and nothing less. The fee system is generally used in radio and televisionadvertising.
3. Cost plus agreement - Under this compensation method, the client agrees to pay the agency a fee based on the costs of its work plus some agreed-on profit margin. The agency is required to keep detailed records of costs incurred in working on a client’s account.
4. Incentive based compensation - As marketers strive to make their agencies more accountable and reduce cost this type of Advertising Agency Compensation Methods is becoming more prevalent
Value-Based Compensation
Agencies are guaranteed only recouped costs, with any profit coming only in certain agreed-upon targets are met.
Percentage charges - When agencies purchase services from other outside agencies they typically add a percentage in the form of a markup charge as their compensation. These markups usually range from 18 to 20 percent.
Q15) Explain careers in advertising? 12 marks
A15)
Skills required for a career in advertising
1. People Skills: In the field of advertising it is very important to have people skills. Every day one has to deal with a number of people and how well one deals with them, determines their worth as an employee. This is an art to be build and should be learnt consistently.
2. Sales Skills: The whole purpose of advertising is to sell. The sales are largely affected by the advertisements. Hence the people in this field must have the sense of how sales take place and what factors affect them. Eventually all the advertisements come down to selling a product or a service.
3. Communication Skills: Advertising is all about communicating. In an advertisement each sentence, each word has its own significance. Therefore it is very important for an advertiser to express themselves clearly and communicate effectively.
4. Creative Skills: High levels of creativity is demanded in advertising and thus one has to stay creative and bring in a number of ideas to the project. The important phase of any advertisement is idea generation and creativity is tested during this phase.
5. Analytical Skills: Medium levels of analytical skills will be required. Before making their plans they have to look for the patterns and analyze the data and therefore this skill also holds relevance.
6. Technical Skills: Advertisers now a days need to have reasonable understanding of the technology that could save their time, energy and effort. The role of technology is improving day by day and the right use of it will help the advertisements do wonder with their audience.
Various Career Options
Some of the career options in advertising related areas are:
- Advertising agency - All over the world, advertising continues to be one of the most sought-after careers. Graduates and even undergraduates with diploma in computers, secretarial course, art-work etc., can hope to start career in advertising.
Advertising Agencies: The agencies are the most visible face of advertising, and the natural first choice of someone planning a career. In an ad agency, one can try out in the following areas:
- Copywriters: Candidates with good communication skills stand a fair chance to be copywriters. One needs a good background of literature and business communication. Intelligence, visualising power and creative thinking are good qualities required by copywriters.
- Artists: Agencies also employ a good number of artists on regular basis and on contract basis. Candidates with a diploma and / or natural talent in art work can qualify for the job of artists.
- Visualizers: Today, visualizing has become a specialized function. Those who can generate creative ideas can qualify for the job of visualizing.
- Production Work: The production department looks after the mechanical production of the ads. This includes typo-graphing, photoengraving, printing, etc. Normally actual production is undertaken on job or contract basis. However, there is lot of administrative work in the production department, to monitor final production of the ad.
- Account Executives: A very important job is handled by account executives. They act as liaison between the client and the agency. Their job is to keep good client relations.
- Media Planners: They look after the planning and selection of media, booking time and space in the media and preparation of ad budget. Commerce graduates with computer background and / or knowledge of statistics do stand a fair chance of getting the job of media planners.
- Advertising media - The media employs large numbers of people to work in their advertising departments. Selling time and space and monitoring the running of advertisements could be the major jobs. Audience or readership research could be another major function. One can do liaison work with sponsors, advertisers, or ad agencies. Some media companies provide marketing service to advertisers. At present, media industry is not restricted to one field. Instead, it includes broadcasting – television, radio, online media, and print media – newspapers, magazines, books, journals, etc. All the fields have witnessed incredible growth.
- Supplying / supporting firms –
- Production houses - Production houses undertake the production of ads, films, serials, documentaries, etc. Some of the production houses include SRK Productions, Balaji Tele Films, Yash Raj Film Studio, Galaxy, Sai Production, Prime Focus, Lemon Tree and several others.
- Market research - Market research involves collection, and analysis of data about market and customers to take marketing decisions, including advertising decisions. Market research has various elements including customer analysis, competitor analysis, risk analysis, product research, advertising research, etc.
- Printing - The Indian printing industry experienced a major technology upgrade in the late 1990s with the electronics and InfoTech revolutions completely changing the image and profile of the industry. Job opportunities are plenty for qualified diploma holders as the printing industry is growing all over India with Mumbai along having about 500 to 600 printing houses and more than 100 processing units. Among the major employers are advertising agencies, the media, and print companies. The largest employer is the government which has printing presses across the country.
- Graphic and animation - Graphic designing is a process of communication through visuals. A graphic designer uses words, images, videos, pictures and graphics to convey any idea or message to the audience. A professional graphic designer creates a layout and design for any print media organization – newspaper, magazine, journal and any other publications. Animation industry in India is growing at a fast pace. Animation is emerging as a vital component of computerized games, video technology, big budget and feature films. The animation industry has got a boost due to the convergence of the Internet and media technologies. Visualization and audio techniques are increasingly being used to interact and produce sophisticated computerized games, ad films, and motion pictures.
- Modeling - Models in advertising promote products or services, so as to create interest on the part of target audience. The goods promoted by models include household items, food items, health tonics, personal care items, etc. The information provided by models facilitates consumer buying decision.
- Voice over – dubbing - A voice-over artist is a person, who lends his / her voice to complement visuals being telecast on the screen. Voice-over can be considered as off-camera commentary. It is a technique wherein voice is modulated in order to be broadcast along with the visuals of the tele film, documentary, advertisement, television serial or news. Radio also makes use of voice-over artists to convey important messages
Freelancing Career Options
Freelancing is a good option for persons wanting to earn a flexible income and to work from home. The popularity of freelancing stems from the fact that it allows you to work at your own time and pace and place. In advertising, freelancing can be done for copywriting, artwork (including graphics and animation), filming the ad, ad research, and so on. Freelancing is a good choice for those of you who do not want to be bound by one boss and a monotonous job.
Following are some tips that will open doors to a host of freelancing opportunities:
- Discover your area of interest and proficiency: Before making a start at freelancing, identify your area of interest as well as expertise. Many of you are capable of penning down your thoughts well. You can consider being freelance copy writing as an option. Freelance photography or filming is also an excellent option. Some may be god at research work.
- Approach the right people: After having identified the area you want to get into, it is important to let people know about it. It is only through adequate networking that you get freelancing opportunities. It takes a lot of patience to do so but once you made the right contacts, you get good opportunities. To be a freelancer, it is very important to promote yourself outside. This can be done by contacting the ad agencies where your friends or relatives work.
- Use Social Media: Social media is also a great tool for networking. Social networking sites like Twitter, Linkedin, YouTube and Facebook are very popular and can be used to find opportunities. Set up your account, make contacts and interact with them. You may be able to attract films looking for freelancers.
- Emailing: You can get in touch with multiple companies direct through e mails. You can compose a message to them, write about what you are looking for and send it. You may also compose some headlines or taglines for certain products and mail it to them. This is a quick and easy way of contacting professionals.
- Search Online: Using search engines on the internet are one of the most common ways to find companies hiring freelancers. The internet will give you a list of places you can consider working for. Now-a-days, organizations create websites which offer such opportunities.
- Price Your Service: Since your services are valuable, you must take to price it appropriately. Learning to make money is a core freelance skill. One of the basics while pricing is to know your experience and level f expertise. As a beginner, you would be expected to charge slightly lower rates but as you go higher up in terms of experience and work, you can gradually increase the rates. Always think long term while pricing your services.
