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This document discusses the participants involved in integrated marketing communications (IMC). It describes the roles of advertisers, advertising agencies, media organizations, collateral service agencies like direct response agencies, sales promotion agencies, interactive agencies, and public relations firms. It also discusses how these organizations work together in the IMC process to plan and execute marketing communications strategies with the ultimate goal of reaching the consumer.
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- 2. Participants in the IMC Process Marketing Communications Specialist Organization Marketing Communications Specialist Organization Media OrganizationsMedia Organizations Advertiser (Client)Advertiser (Client) Advertising AgencyAdvertising Agency 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
- 3. “THE CONSUMER” The client is ultimately a consumer for an advertising agency. The company wants an ad to be prepared keeping in mind the final end consumer
- 4. 4 Consumer in the Real World Social class Geo- politics Rituals Family Values Reference Groups (membership/aspiration) Race/ Ethnicity Gender Culture Community Object Meaning
- 5. Factors Affecting Consumer Decision Making SUBCULTURESSUBCULTURESSUBCULTURESSUBCULTURES MEDIAMEDIAMEDIAMEDIA NEWSNEWS MAGAZINESMAGAZINES RADIORADIO TELEVISIONTELEVISION DIRECT MEDIADIRECT MEDIA BLOGSBLOGS INTERNET INFOINTERNET INFO NEWSNEWS MAGAZINESMAGAZINES RADIORADIO TELEVISIONTELEVISION DIRECT MEDIADIRECT MEDIA BLOGSBLOGS INTERNET INFOINTERNET INFO NEEDSNEEDSNEEDSNEEDS PRICEPRICE PACKAGINGPACKAGING ADVERTISINGADVERTISING PROMOTIONPROMOTION PERSONAL SELLINGPERSONAL SELLING PRICEPRICE PACKAGINGPACKAGING ADVERTISINGADVERTISING PROMOTIONPROMOTION PERSONAL SELLINGPERSONAL SELLING MARKETER-MARKETER- CONTROLLEDCONTROLLED STIMULISTIMULI MARKETER-MARKETER- CONTROLLEDCONTROLLED STIMULISTIMULI EDUCATIONEDUCATIONEDUCATIONEDUCATION VALUESVALUES // ATTITUDESATTITUDESVALUESVALUES // ATTITUDESATTITUDES PASTPAST EXPERIENCEEXPERIENCE PASTPAST EXPERIENCEEXPERIENCE PERSONALITYPERSONALITYPERSONALITYPERSONALITY PLEASUREPLEASUREPLEASUREPLEASURE GENDERGENDERGENDERGENDER CULTURECULTURECULTURECULTURE LIFE-STYLELIFE-STYLELIFE-STYLELIFE-STYLE SOCIALSOCIAL CLASSCLASS SOCIALSOCIAL CLASSCLASS REFERENCEREFERENCE GROUPSGROUPS REFERENCEREFERENCE GROUPSGROUPS FAMILYFAMILYFAMILYFAMILY SITUATIONALSITUATIONAL FACTORSFACTORS SITUATIONALSITUATIONAL FACTORSFACTORS CONSUMERCONSUMER DECISIONSDECISIONS CONSUMERCONSUMER DECISIONSDECISIONS
- 6. • Keeping & understanding all these in mind, an ad agency works.
- 7. Advertising Agency Agency –of-record (AoR) • There are special groups which operate as consultants and who aid either the advertiser, the media firm or the media in the development of the ad. • The ad agency is an independent company set up to render specialized services in advertising in particular & marketing in general.
- 8. • Many companies have their own active advertising departments which develop the ad message and select proper media for its execution. • While there are special service groups which operate as consultants and who aid the advertiser. • The advertiser should select an advertising agency on the basis of compatibility, agency size, agency stability, agency team service, selling attitude, creativity & problem solving approach
- 9. • Previously ad agencies started as space brokers for handling of the advertisements placed in the newspapers. • It may be a full scale agency or part scale agency. • Sometimes, several agencies in the same area because they believe the competition will result in better work
- 10. Why an advertising agency? • Provides specialized services • Objective advice • Experienced staffing • Tailored management of all advertising activities and personnel.
- 11. 2 primary roles of agencies • idea generation • brand-building
- 12. Idea generation Brand Building Ideas about promotion, product development, marketing strategies, • To create and direct communication about a product or service so that the brand is perceived to have a unique value or brand personality.
- 13. Other Functions • 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 communications
- 14. Evolution of advertising agency • 1840 • Some people started working as Sales representatives / space brokers for newspapers on a commission basis. • Advertiser media= clients for agency • This era lasted from 1840-1876 • Little emphasis on advertising planning & media schedule. • J.Walter Thompson set up a shop in Mumbai in 1929 as a part of UK based agency for eastern operations. It was India's first advertising agency.
- 15. 4 functions of an Ad Agency • Account Management • Creative Service • Media Service • Research Service
- 16. Advertising Agency Organization • Develop advertising copy and campaigns • Copywriters, production people, and creative directors Creative Services Account Management Media Services Research Services
- 17. creative department • executive & group creative directors • creative director • associate creative director • copywriters • art directors • broadcast producers • print production managers • traffic coordinators Print Traffic Production Broadcast Production C o p y S p v r . & C o p y w r it e r s A r t S u p e r v is o r & A r t D ir e c t o r s C r e a t iv e G r o u p : A s s o c ia t e C r e a t iv e D ir e c t o r ( A C D ) C r e a t iv e D ir e c t o r ( C D ) E x e c u t iv e C r e a t iv e D ir e c t o r ( E C D ) S t r a t e g y R e v ie w B o a r d
- 18. Advertising Agency Organization • Selecting the best advertising media • Media planners develop overall media strategy • Media buyers procure the selected media Creative Services Account Management Media Services Research Services
- 19. • media director • associate media directors • media supervisors • media planners • media buyers • media analystsAnalysts M e d i a P l a n n e r M e d i a B u y e r M e d i a S u p e r v i s o r A s s o c i a t e M e d i a D i r e c t o r M e d i a D i r e c t o r MediaMedia PlanPlan media department
- 20. Research Services • Study clients’ customers’ buying habits, purchase preferences, and responsiveness • Focus groups, mall intercepts, acquisition of syndicated research data Creative Services Account Management Media Services Research Services
- 21. • research director • research project managers • research assistants • outside research specialists research department Research Suppliers Outside R e s e a r c h A s s i s t a n t s P r o j e c t M a n a g e r s R e s e a r c h D i r e c t o r ResearchResearch ReportReport
- 22. research department • 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 ResearchResearch ReportReport
- 23. Advertising Agency Organization • Link the agency with the client • Act as liaisons so that the client does not need to interact directly with several different service departments and specialists Creative Services Account Management Media Services Research Services
- 24. • account management director • management supervisor • account supervisors • account executives • assistant account execs • account coordinators • trafficTraffic A ss t. A c c o u n t E x e c u tiv e A c c o u n t C o o r d in a to r A c c o u n t E x e c u tiv e A c c o u n t S u p e r v is o r M a n a g e m e n t. S u p e r v is o r A c c o u n t M g m t. D ir e c to r account management
- 25. Classification of agencies On the basis of Services On the basis of organizational set up Location ( in or Outside) the organization
- 26. Centralized System PresidentPresident ProductionProduction FinanceFinance MarketingMarketing Research and Develop- ment Research and Develop- ment Human Resources Human Resources AdvertisingAdvertising Marketing Research Marketing Research SalesSales Product Planning Product Planning On the basis of organizational set up
- 27. Fewer Personnel Fewer Personnel Better Communications Better Communications Continuity Of Staff Continuity Of Staff Longer Response Time Longer Response Time Less Goal Involvement Less Goal Involvement Better Communications Better Communications Fewer Personnel Fewer Personnel Continuity Of Staff Continuity Of Staff Less Goal Involvement Less Goal Involvement Longer Response Time Longer Response Time Pros & Cons of Centralization The Centralized System The Centralized System + Positive+ Positive - Negative- Negative Can’t Do Multiple Product Lines Can’t Do Multiple Product Lines
- 28. Decentralized Brand Management System Production Finance Sales Brand Manager Ad agency Brand Manager Ad agency Product Management Sales Promotion Package Design Merchandising Advertising Department Marketing Research Marketing Services Marketing Research and Development Human Resources Corporate
- 29. Competition for Resources Competition for Resources Competition for Resources Competition for Resources Lack of Experience in IMC Lack of Experience in IMC Lack of Experience in IMC Lack of Experience in IMC Rapid Problem Response Rapid Problem Response Concentrated Attention Concentrated Attention Increased Flexibility Increased Flexibility Increased Flexibility Increased Flexibility Rapid Problem Response Rapid Problem Response Concentrated Attention Concentrated Attention Pros & Cons of Decentralization The Decentralized System The Decentralized System + Positive+ Positive - Negative- Negative Lack of Authority Lack of Authority
- 30. Roles of an Advertising Manager Advertising Functions • Making the ad strategy in collaboration • Evaluation of the ad • Determining the ad efforts • Coordinating with the agency • New developments in advertising • Making the ad budget.
- 31. Managerial functions • Making advertising understandable • Representing the organization • Goal setting for advertising • Administration in general • Creative thinking wrt his functions • Participation with higher ups about his function
- 32. Classification of Agencies on the basis of Extent of their Services • Full service Agencies • Limited Service Agencies (A La Carte Agency) • Specialized Agencies On the basis of Services
- 33. Creating advertising Creating advertising Planning advertising Planning advertising Producing advertising Producing advertising Performing research Performing research Selecting mediaSelecting media Sales promotion and training Sales promotion and training Strategic market planning Strategic market planning Trade show materials Trade show materials Package designPackage design Planning advertising Planning advertising Creating advertising Creating advertising Producing advertising Producing advertising Performing research Performing research Selecting mediaSelecting media Strategic market planning Strategic market planning Sales promotion and training Sales promotion and training Trade show materials Trade show materials Package designPackage design Full-Services Agencies Full Range of Marketing Communication and Promotion Services Full Range of Marketing Communication and Promotion Services Non-Advertising Services Non-Advertising Services Public relations and publicity Public relations and publicity
- 34. John Monsattal’s reasons for FSA • Sales oriented creative work • Synergistic experience • Centralization of responsibility & accountability • Greater objectivity • Simplified coordination & administration • Professional strength in marketing area • Stronger pool of talents.
- 35. Advantages • In-depth knowledge and skills • Obtaining negotiating muscle with the media • Coordinating advertising and marketing efforts Full-service advertising agency Disadvantages • Some control is lost • Larger clients are favored over small clients • Occasionally inefficient in media buying
- 37. ArtistsArtists Ad Agencies Have Skilled Specialists WritersWriters ResearchersResearchers PhotographersPhotographers Media AnalystsMedia Analysts Other SkillsOther Skills
- 38. The Role of Creative Boutiques Creative Boutiques Creative Boutiques Provide Only Creative ServicesProvide Only Creative Services Full-Service Agencies May Subcontract With Creative Boutiques Full-Service Agencies May Subcontract With Creative Boutiques Provide Only Creative ServicesProvide Only Creative Services Full-Service Agencies May Subcontract With Creative Boutiques Full-Service Agencies May Subcontract With Creative Boutiques Other Functions Provided by the Internal Client Departments Other Functions Provided by the Internal Client Departments
- 39. Specialize in Buying Media, Especially Broadcast Time Specialize in Buying Media, Especially Broadcast Time Agencies and Clients Develop Media Strategy Agencies and Clients Develop Media Strategy Agencies and Clients Develop Media Strategy Agencies and Clients Develop Media Strategy Specialize in Buying Media, Especially Broadcast Time Specialize in Buying Media, Especially Broadcast Time Media Buying Can Be Specialized Media Buying Services Media Buying Services Media Buying Organizations Implement the Strategy and Buy Time and Space Media Buying Organizations Implement the Strategy and Buy Time and Space
- 40. Direct Mail Direct Mail Data Base Management Data Base Management ResearchResearch CreativeCreative Media ServicesMedia Services CreativeCreative Media ServicesMedia Services ResearchResearch Direct Mail Direct Mail Data Base Management Data Base Management Direct Response Agency Activities Direct Response Agencies Direct Response Agencies ProductionProduction
- 41. Contest/Sweepstakes Development Contest/Sweepstakes Development Contest/Sweepstakes Development Contest/Sweepstakes Development Promotion PlanningPromotion Planning Creative WorkCreative Work ResearchResearch Coordination With Advertising Coordination With Advertising Premium DesignPremium DesignPremium DesignPremium Design Coordination With Advertising Coordination With Advertising ResearchResearch Creative WorkCreative Work Promotion PlanningPromotion Planning Data Base MarketingData Base Marketing Activities performed by Sales Promotion Agencies
- 42. AudioAudio Special EffectsSpecial Effects VideoVideo Web Banner Ads Web Banner Ads KiosksKiosks Web SitesWeb Sites CD-ROMsCD-ROMs Special EffectsSpecial Effects VideoVideoAudioAudio KiosksKiosksCD-ROMsCD-ROMs Web SitesWeb SitesWeb Banner Ads Web Banner Ads Functions performed by Interactive Agencies Interactive Media Creation Interactive Media Creation Digital Content Digital Content AnimationAnimation
- 43. Planning and Implementing Research Planning and Implementing Research Planning and Implementing Research Planning and Implementing Research Information Application Information Application Analysis and Interpretation Analysis and Interpretation Primary Data Collection Qualitative & Quantitative Primary Data Collection Qualitative & Quantitative Secondary Data Collection Secondary Data Collection Primary Data Collection Qualitative & Quantitative Primary Data Collection Qualitative & Quantitative Analysis and Interpretation Analysis and Interpretation Information Application Information Application Marketing Research Companies
- 44. Strategy Development Generating Publicity Lobbying Public Affairs Damage Control Image Portrayal Strategy Development Generating Publicity Lobbying Public Affairs Damage Control Image Portrayal Functions performed by Public Relations Firms Program Planning
- 45. Participants in the IMC Process Full service & Limited Service Ad Agencies Full service & Limited Service Ad Agencies Media OrganizationsMedia Organizations Advertiser (Client)Advertiser (Client) Advertising AgencyAdvertising Agency 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
- 46. Collateral Services offered by an advertising agency • Meta markets • They include marketing research companies, package design firms, consultants, photographers, printers, video production houses, event marketing services companies
- 47. In House Agencies • An organization may decide to establish its own operation for all services of an advertising agency with in its own structure. • As the name suggests the agency is owned & operated under the direct supervision of the advertiser.
- 48. More Control More Control Cost Savings Cost Savings Better Coordination Better Coordination Less Objectivity Less Objectivity Less Experience Less Experience Less Objectivity Less Objectivity Less Experience Less Experience Better Coordination Better Coordination More Control More Control Cost Savings Cost Savings Pros & Cons of In-House Agencies The In-house Agency The In-house Agency + Positive+ Positive - Negative- Negative Less Flexibility Less Flexibility
- 49. Selecting an agency • Have they fully understood the brief? • Do they know how to use market research? Can they contribute to our thinking here? • Is their strategic thinking sound? • Is it imaginative? Have I learned anything useful from it? • Are they professional and businesslike? • Can I work with their senior people? And will they be actually working on my business? • Are their capabilities high in all key areas – management, strategy, creative, media? • Do they work well as a team – both among themselves and with our people?
- 50. Selecting an agency • Is their creative work of a high quality? • Is this confined to TV, or does it go across all media? • Does this include below-the-line? New media? Can they offer an integrated service? • Do they have real expertise in the specialist areas which we are looking at, egl direct marketing, new media? • Can they work with us internationally (now or in the future) • How do they propose to evaluate the effectiveness of the campaign?
- 51. Selecting an agency • What is their attitude to costs? Will they save us money? • How will they relate to our media buying agency/other specialists? • How important to them will our account be? Will we be one of their larger accounts, or simply a small fish in a very large pool? • Will they fit with our ways of working? Are they willing and able to be business partners, or will they simply be suppliers? (This depends – of course – on how we see our own style of dealing with agencies)
- 52. Commissions Method Commissions Method Cost-Plus Agreements Cost-Plus Agreements Percentage Charges Percentage Charges Fee Arrangements Fee Arrangements Incentive-Based Payment Incentive-Based Payment Commissions Method Commissions Method Cost-Plus Agreements Cost-Plus Agreements Percentage Charges Percentage Charges Fee Arrangements Fee Arrangements Methods of Agency Compensation Compensation Methods Compensation Methods
- 53. Media Commission Mark up/ Percentage charge • Oldest method • Fixed % from the media whenever it is booking advertising space in print or a slot in electronic media on behalf of its client. • Administrative charges are calculated, • Fix % of total amount & expenses is billed to the client.
- 54. Fees Incentive based compensation• Straight fees or Fixed Fees method ( the media commissions earned are returned to the advertisers or are credited against the fees) • Fee Commission method (fixed monthly fees is charged by the agency & commissions earned from media too are retained) • Performance based compensation • Commission + fee system combination • Amount= effectiveness of the ad campaign • Advertising goals (DAGMAR) & other factors. • Reward or Penalize ( by paying only part of the decided fees)
- 55. Poor performance Unrealistic demands Personality conflicts Personnel changes Conflict of interests Changes in strategy Declining sales Payment conflicts Policy changes Poor performance Poor communications Unrealistic demands Personality conflicts Personnel changes Conflict of interests Changes in strategy Declining sales Payment conflicts Why Agencies Lose Clients
- 56. ReferralsReferrals How Agencies Gain Clients SolicitationsSolicitations PresentationsPresentations Public RelationsPublic Relations Image, ReputationImage, Reputation
- 57. Group Assignment • Detailed history of any agency of your choice. • Story • Man power behind its success • Their list of clients ( at least 8) • Their work/ ads
- 58. Next Class • Types of advertisements • Appeals used in ads • Articles & research papers related to the same from Journals • Advertising budget • Planning the advertising media