Organizing for Advertising and Promotion: The Role of Agencies and Other Marketing Communication...
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Organizing for Advertising and Promotion: The Role of Agencies and Other Marketing Communication Organizations
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Organizing for Advertising and Promotion:
The Role of Agencies and Other Marketing Communication Organizations
Organizing for Advertising and Promotion:
The Role of Agencies and Other Marketing Communication Organizations
Preview
• What are the two IMC organizational systems? What are the pluses, minus and characteristics each of each?
• What are the pluses and minuses of an in-house agency organization?
• Define the roles of the client and the agency• Identify some considerations for effectively
working with agencies
Participants in the IMC Process
Marketing Communications Organizations
Marketing Communications Organizations
CompanyCompany
Collateral servicesCollateral services
Direct-response agencies
Direct-response agencies
Sales promotion agencies
Sales promotion agencies
Interactive agencies
Interactive agencies
Public Relations
firms
Public Relations
firms
Ad agencies
Ad agencies
Trade Show
Exhibits
Trade Show
Exhibits
PrintersPrintersA/V
ServicesA/V
Services
Organizing for Advertising and Promotion
• The way a company organizes depends on– Its size– The number of products it markets– The role of IMC in the marketing mix– The budget– Its marketing organization structure
IMC Under A Centralized System
PresidentPresident
ProductionProduction FinanceFinance MarketingMarketingResearch
and develop-
ment
Research and
develop-ment
Human resourcesHuman
resources
Marketing research
Marketing research AdvertisingAdvertising SalesSales Product
planningProduct planning
Pros & Cons of a Centralized System
Fewerpersonnel
Fewerpersonnel
Bettercommunications
Bettercommunications
ContinuityContinuity
Longerresponse time
Longerresponse time
Less goalinvolvementLess goal
involvement
TheCentralized
System
TheCentralized
System
+ Positive+ Positive - Negative- Negative
Impractical formultiple brands,
products, divisions
Impractical formultiple brands,
products, divisionsMore top
management involvement
More top management involvement
Decentralized IMC System
Production Finance
Sales
Brand Manager
Ad agency
ProductManagement
Sales promotion
Package design
Marketingservices
Marketing R & D Human Resources
Corporate
Brand Manager
Ad agency
AdvertisingDept
Marketing Research
Merchandising
Pros & Cons of Decentralization
Internal conflicts Internal conflicts
Ineffective decision making
Ineffective decision making
Rapid problemresponse
Rapid problemresponse
Concentratedattention
Concentratedattention
Increasedflexibility
Increasedflexibility
TheDecentralized
System
TheDecentralized
System
+ Positive+ Positive - Negative- Negative
Unequal distribution
of funds
Unequal distribution
of funds
Lack ofAuthorityLack of
Authority
Pros & Cons of In-House Agencies
MorecontrolMore
control
CostsavingsCost
savings
Bettercoordination
Bettercoordination
Lessobjectivity
Lessobjectivity
Lessexperience
Lessexperience
TheIn-houseAgency
TheIn-houseAgency
+ Positive+ Positive - Negative- Negative
Lessflexibility
Lessflexibility
Services Provided by Agencies
Agency ServicesAgency Services
Research department
May include account planners
Media/place-ment depts .obtains media space, time
Research department
May include account planners
Media/place-ment depts .obtains media space, time
Marketing Services
Marketing Services
The link between agency and client
Managed by the account executive
The link between agency and client
Managed by the account executive
Account ServicesAccount Services
Creation and execution
Copywriterartists, SEO, other specialists
Creation and execution
Copywriterartists, SEO, other specialists
Creative ServicesCreative Services
Accounting
Finance
Human Resources
New business generation
Accounting
Finance
Human Resources
New business generation
Mgmt & FinanceMgmt & Finance
• Weekly meetingsnecessary
• Insist on timelyresponse to marketspeculation/rumor
• Agency – outwardIn-house – inward
• Don’t dictate whatthey do
• Look for creativity• If you have to
• dictate100% of • your time, get a
• new agency
• Where are wenow?
• What do we wantto achieve?
• What are thechallenges?
• How do weachieve goalseffectively andefficient?
Foundation For Agency Relations
Scrutinize Needs /Best Use of Resources
Respect DifferentPerspectives
Thorough/TimelyCommunications
Agencies’ Responsibilities
• Respect confidentiality• Provide “Best of Class” counsel and services• Assign an appropriate stable, multi-layer account team • Proved special capabilities (i.e. web 2.0 consulting) beyond
the day-to-day account team• Meet all deadlines• Communicate, communicate, communicate• Develop expectations that are attainable and measurable• Maintain frequent and scheduled contact• Deliver innovative ideas …whether or not they are
accepted• Maintain budget controls• Handle billing and reporting accurately and promptly• NO SURPISES
Client Agency Relationship
Client• Set corporate
strategies• Align strategies &
objectives• Supervise and co-
ordinate all program elements
• Define evaluation metrics & KPIs
• Establish budgets
Agency• Collaborate on
Objectives• Develop tactical
programs• Implement tactics• Deliver measurable
and measured results• Meet budget
expectations
Agency Business Basics
• How they charge -- ultimately– By hour – TIME is the commodity -- – Out-of-pocket expense – bill for approved items– 17.5% service charge – large amount of advanced
payment on behalf of a client• What are they specialized in?
– Communications know-how– Creativity– Planning skill – Solid execution experience– Media knowledge– Strong local know-how
• Conflict of InterestAgencies work with only one company in each category – several semiconductor companies but only one foundry
Working Effectively with Agencies
• Agencies submit a yearly budgets and quarterly programs to chart their activities and measure their effectiveness.– Activity costs are based on estimated time to
execute a task– Although we can ask for extra effort, we should be
respectful of the fact that time IS money• Agencies are partners. Professional ethics require
them to keep confidential information confidential. Always be honest and forthright about both the good and the bad– Legally, all TSMC agencies are under NDA. – Breaking confidentially will permanently
“blackball” an agency• Be specific and detailed in requests to the agency.
Don’t make them guess. There’s no such thing as too much information
Maximizing Resources
• Focus and adding the most value and mitigating the most risk. Value, not activities.
• Asses strengths & weaknesses and assign specific roles … internally & externally
• Set expectations through service level agreements that set priorities
• Identify & respond to gaps by defining alternative self service, outsourcing, collaborative model
• Communicate, communicate, communicate the benefits, processes and reasons
“5 Steps to Formalizing Roles and Defining Responsibilities”: Peter Schram, 2011
In Review
• What are the two IMC organizational systems? What are the pluses, minus and characteristics each of each?
• What are the pluses and minuses of an in-house agency organization?
• Define the roles of the client and the agency• Identify some considerations for effectively
working with agencies
Organizing for Advertising and Promotion:
The Role of Agencies and Other Marketing Communication Organizations
Organizing for Advertising and Promotion:
The Role of Agencies and Other Marketing Communication Organizations
