“An organization that provides a variety of advertising related services to
clients seeking assistance in their advertising activities.”
- American Marketing Association
Full-service advertising agency engages in the planning and administration of
advertising campaigns, including setting advertising objectives, developing
advertising strategies, developing and producing the advertising
messages, developing and executing media plans, and coordinating related
activities such as sales promotion and public relations.
Limited-service advertising agency concentrates on one of the major
advertising agency functions such as developing and producing advertising
messages or media plans.
Complete a marketing analysis
Develop an advertising plan
Prepare a creative strategy
Create advertising executions
Develop and implement a media plan
Handle billing and payments
Integrate other marketing communication
Media planning and placement
[ Chairm an/CEO]
Other Market ing
Com municat ions
[ PR, etc.]
Com mitt ee]
Off ice M
[ Pers onnel,
Account Mgmt .
Ass is tants
Ass t. Account
Copy Spvr. &
& Art Direct ors
edia Dept .
• Responsible for understanding...
– the client’s business
– the client’s marketing needs
– strategy development
• Representing client point of view within the agency
The creative department is responsible for creating
and producing the print and broadcast advertising
Strategy is key
Good creative work is always guided by a creative
strategy that sets forth goals to be accomplished
and key message points to be relayed
The media department has two main functions planning and buying.
• The planning group handles more strategic
marketing and media issues.
• The buying group handles media negotiations and
• Interpret market environment
– Gather and analyze research data.
– Primary and secondary techniques.
• Determine consumer needs/perceptions
– Understand problems.
• Advise how ads can meet strategic goals
– Help find solutions.
3 ways agencies make money
– Usually 15% of gross costs
– Usually based on negotiated hourly rate
– Still relatively new and problematic
– Usually based on performance goals
• Media commission system
– 15% media commission
• Adjustable commission rates
– Negotiate to match client budget
• Markups-production & service
– Add a percentage markup to costs
– 17.65% of net = 15% of gross
• Get paid based on how well you do, not how much
• In practice, difficult to implement
• If client makes final decision (instead of
agency), how can agency be responsible for final
• Results based on many factors, such as competitive
efforts, not just advertising