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Chapter 3:Chapter 3:The The BUSINESS BUSINESS of of

AdvertisingAdvertising

http://www.sba.gov/content/advertising-basics

Companies spend Companies spend $$$$$$ billions all over billions all over

the world on the world on advertising, to advertising, to establish their establish their brands and sell brands and sell internationally.internationally.

The Players

Advertisers Agencies

Suppliers Media

It’s ALL Local

Half of all UUSS advertising is local – targeting customers within the same city/county as the advertiser.

4 Types of local advertiser:• Dealers/local franchises• Stores (convenience, grocery, Dept.)• Specialty services (banks, bars, restaurants)• Gov’t & nonprofit orgs (charities,

municipalities, utilities) Ad manager performs most planning,

administrative & execution functions.

Regional/National Regional: operate in one or more states. National: in several regions of the

country. Share similar challenges as Local

advertisers, but the larger the firm the bigger the need to strategically build and maintain strong brands.

Types of Advertising

Product Sales Institutional Classified

Serve Your Client

To most effectively represent your client you MUST understand their challenges, business goals, market, competitors, budget, culture, etc.

3-A (text: page 61.) My experiences at TMP Worldwide.

Integrated Integrated Marketing Marketing

CommunicationsCommunications

Building & reinforcing mutually Building & reinforcing mutually profitable relationships with profitable relationships with

customers, employees and other customers, employees and other stakeholders and general public by stakeholders and general public by

coordinating a strategic coordinating a strategic communications program that communications program that enables them to make contact enables them to make contact with the company through a with the company through a

variety of media.variety of media.

Co-op Advertising

Wholesalers and manufacturers often provide local advertisers (retailers) with READY-MADE co-op advertising, where the costs are shared.

The Ad Department Centralized Versus Decentralized Centralized: ONE Team for all ad needs Decentralized: Separate departments

for different divisions, regions, brands, or other categories.

Transnational: Advertise globally. (Ex. McDonald’s “I’m Lovin’ It“ in all 118 countries that it serves food in.)

The Ad AgencyThe Ad Agency

Ad Agency Works solely for the good of its

clients. Employs blend of business and

creative people. Runs independently of the

advertiser.

Types of Agency Geographic. Range of Services. Specialized Service: Assist their

clients with a limited type/range of expertise.

Ad Agency Jobs

Account Management: Teams that serve as liaison between the agency and the client.

Research & Account Planning: provide product, market and competitive information.

Media Planning & Buying. Creative: The prima donnasprima donnas. Traffic Management: Coordinates all

phases of production.

Client-Agency Relationship

Clients come from referrals, networking, and community relationships.

Soliciting new business. The presentation “pitch.” The chemistry between agency and

client matter most. Dwindling client loyalty as per the

agency REVIEW process.

The Suppliers

Art studios. Web Designers. Printers. Film & video houses. Research companies.

The Top The Top 5050

The Media PlanThe Media Plan

Why Work in AnWhy Work in AnAd AgencyAd Agency

Remember Our Remember Our Talk About Talk About Offensive Offensive

Advertising?Advertising?