What is an advertising agency

advertising agency

is a company that supports other companies in their activities in the context of sales: preparation (market research, design of advertising materials), implementation (placement of advertising materials in advertising media) and control (advertising success control) of advertising measures. The traditional tasks of an advertising agency are to research the market and demand, design advertisements, billboards, radio and television commercials, etc., distribute them in the media and monitor their effectiveness. Furthermore, the agencies today perform a variety of other tasks, ranging from measures to design corporate identity and the management of entire advertising budgets of companies to participation in product design.

see advertising.

Market communication service company that takes on tasks from its clients in one, several or all of the following areas: Advice on creating a concept for market communication, d. H. Market research, planning the marketing mix or media selection; Averaging, d. H. Execution of certain partial services in the creative implementation, such as the production of advertising material or media purchasing; as well as planning, design and implementation of advertising, sales promotion or PR campaigns, packaging, etc. If an advertising agency takes on tasks in all three of the areas mentioned, it is referred to as a full-service agency. There are also companies that have specialized in individual activities in the context of corporate market communication. These include, for example, advertising consultants, media agencies, graphic designers, copywriters, photographers, video studios, printers, address vacancies or direct advertising institutes. Full-service agencies can be structured according to departments or process their orders in the form of project management. Account managers, who are referred to either as contacts or as budget directors, represent the link between advertisers and the agency. The creative department takes care of the creative work or parts of it that are necessary for the implementation of the advertising message. The creative employees, such as copywriters, graphic designers, photographers or cameramen, are sometimes assigned to individual sub-departments in larger agencies, such as copy, art or production. The media department takes care of the selection of the most suitable advertising media for the individual campaigns or their optimal combination. It buys the required space or the time in these media and takes care of the distribution of the advertising material. Some agencies also have their own research department. With the information it collects and evaluates about the product market and the media, as well as advertising tests, it supports the agency's decisions in the creative and media area. The traffic department plans and coordinates the work of the other departments in such a way that the simultaneous processing of all orders is possible on time. Due to the importance of a uniform communicative appearance towards all parts of the public, which is increasingly recognized by customers, a number of advertising agencies have created public relations and sales promotion departments. The briefing forms the basis of the work of a full-service agency. It is either specified by the client or developed together with the advertising agency. The cooperation between the agency and the customer takes place in several meetings. These should at least take place when the briefing is available or is to be developed, initial ideas for the campaign can be discussed, design drafts for the communication media and media plans have been completed and when the production of the communication media has been completed. Before a company engages an advertising agency, it should be clear about whether it is willing and able to provide the agency with the often very extensive internal information that is necessary for the fulfillment of its intended task. A competition exclusion clause can be included in the contract, but in practice problems arise again and again with the exact determination of competitive relationships. On the other hand, this difficulty is offset by the fact that the cooperation with advertising agencies gives a company the advantage of being able to use specific experience and creative potential of experts as required. When choosing the most suitable advertising agency, v. a. to weigh their capabilities in relation to the task at hand. Loners and creative teams usually offer highly creative ideas and design proposals, but have little or no experience in conceptual work. Medium-sized agencies, which are often run by the owner himself and work with freelancers, are very efficient, especially with smaller budgets for local or national campaigns. However, they are usually only insufficiently able to participate in the development of a communication strategy. Larger full-service agencies have largely achieved a standard of service that also meets the requirements of experienced advertisers. You are either multinational or you belong to a group of agencies that work together internationally. What speaks against the use of a full-service agency, however, is that it is often only ready to take on an order if it has a certain minimum budget. In Germany there are currently (1990) about
2. 500 agencies with up to 500 employees. Agency directories such as Mediaadress (Mediadaten-Verlag Mainz) or the GWA directory (Society of Advertising Agencies, Frankfurt) provide an overview. "Hit lists" of the largest agencies are regularly published by the specialist body "w & v". There are internationally customary standards for agency remuneration, which can be divided into two basic forms of billing: the commission system and the service fee system. With the commission system, the advertising agency receives for its activity as an advertising agent, cf.h. As a buyer of space or time for placements in advertising media, a commission (usually 15%) from the advertising executors, i.e. the owners of the advertising media used, which they withhold. With the service fee system, the agency assigns to the customer all discounts and commissions accruing to the customer through the inclusion of spreadable advertising material of the client in advertising media. Instead, it charges him a flat fee for the services it provides. In recent times, there have also been efforts to make the advertising agency's remuneration dependent on the degree of target achievement. However, due to the difficulties in clearly assigning advertising effects to the degree of target achievement, such agency remuneration systems have hardly found widespread use. The total sales volume ("billings") of the German advertising agencies, which is made up of the media budgets and / or commissions and flat-rate fees processed by them, was estimated in 1989 at around EUR 15 billion. The resulting “gross income” (“net sales”) after deducting the media expenses paid to the advertising media is z. Partly also calculated by extrapolating the fees that are not paid on a commission basis by multiplying them by the factor 100/15 = 6.67 to so-called "equivalent billings", i.e. corresponding net sales. This makes it possible to compare the sales volume of agencies with different revenue shares from commissions and fees.

Literature: Zuberbier, J., Die Werbeagentur. Functions and working method, in: Tietz, B., Die Werbung, Landsberg a. L. 1982.

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