The emergence and development of global advertising agencies - Advertising

The emergence and development of global advertising agencies

Any company that starts to master foreign markets needs advertising support. For example, when the expansion of Japanese car manufacturers, audio, video and home appliances began in European and North American countries, then Japanese advertising agencies moved to the same countries. Behind American brands around the world pulled American agencies. Thus, the emergence of TNCs led to the creation and development of network agencies. The staff of such agencies was filled with both expats representing the head office of the network, which transferred and monitored the observance of the network's experience and technologies, as well as local staff, which simultaneously allowed to unify the communication support of the network and provide local expertise.

So, the main features of the network agency are:

• work in more than one national advertising market by creating an appropriate branch or representative office of the parent agency from scratch or by purchasing an existing local agency;

• standardization of the services and technologies of the agencies operating in the network, ensuring unification of communication between brands of advertisers in each of the national markets of the network.

One of the sources of development of any business is its diversification, entering new markets, new customers or offering them new services. The advertising business is an exception. As a result of its development on the basis of network agencies, advertising groups began to be formed through the establishment, allocation or purchase of new agencies working with new markets. For example, the ad group Gray as of 2009 included five network agencies: actually Gray (client and creative agency), G2 ( BTL and digital communications), GHG (agency specializing in customers from the pharmaceutical market), Batey (an agency operating in the market of Southeast Asia) and Wing (an agency working with Hispanic markets and audiences).

The advertising group is not the limit of consolidation and diversification within the advertising business. Often advertising groups are constituent parts of large international advertising holdings. For example, the same ad group Gray is part of the WPP holding holding in addition to it groups such as Young & amp; Rubicam (16 agencies), Ogilvi & amp; Mather ( 7 ) , JWT (3), United Group (2), WPP Digital (6), media group Group M (6), as well as four network agencies that do not form independent groups. In addition, WPP owns shares of seven more network agencies, and it belongs to a group of research companies Kantar. As a result, the advertising holding is present and able to provide expertise on almost all national and commodity advertising markets and provides all kinds of activities related to the promotion of products - research, development of communication, its creative implementation and production, placement in ATL - and BTL-kapalah communications. In addition, this structure allows the holding to service and earn money on customers competing in one market, distributing them to different agencies and networks. For example, the same WPP is served by Unilever and part of the brands Procter & amp; Gamble - companies that compete with each other around the world in a variety of product categories.

Another, though optional, sign of an international network agency is its publicity, ie, free sale of shares on one of the world's major stock exchanges. Publicity meant and means the possibility of obtaining additional financial means through primary sales and further circulation of shares in order to use these funds for further development of the network in the internal and external areas. Within the framework of internal development of the network, new technologies of work and communication are created, new customers and new markets (geographic and commodity) are developed, and the staff, structure and infrastructure of the network are developed and improved. External development involves mainly the creation and purchase of new agencies working in new markets, with new customers, with interesting staff using new technologies, etc. And every new internal or external achievement, a new client or a new acquired agency with its customer list and technologies means the growth of stock quotes, and hence the possibility of its further development.

The beginning of the publicity of major advertising agencies was put in 1964 by the American agency Foot, Cone & amp; Belding, later known under the abbreviation FCB. However, it can not be said that such a championship gave serious long-term advantages, since in 2001 this agency was bought by the holding company Interpublic, which serves as an example of the first experience of building an international advertising holding. His creation is connected with the activities of Marvin Harper, President of McCann Erickson. In 1960, based on this agency, he created an advertising holding Interpublic, buying up advertising and marketing agencies on all significant markets. The construction of Interpublic required a significant amount of borrowed funds, as a result of which by 1967 the holding company faced the need to pay financial liabilities. The main condition under which banks were ready to provide new loans was Harper's departure from the post of the head of Interpublic. For a while, Interpublic had to limit its expansion, but an example of consolidation advertising agencies and groups within the framework of international advertising holdings has been shown and taken into account. Yes, and the company Interpublic has literally in a decade returned to the construction of an advertising holding and now ranks fourth in the global advertising market.

The current height of mergers and acquisitions in the advertising market, which began to form a modern picture of the advertising world, occurred in the 1980-1990s. In his book, "The Future of Advertising" American Joe Cappo cites data on changes in the status of the world's leading agencies 20 agencies as of 1981 and 20 years later. In Table. 2.7 presents updated and supplemented information on advertising agencies - former market leaders in 1981, and shows their situation in 2010 and the events that led to this. In general, it can be seen that agencies that were once independent networks, almost all now enter the global advertising holdings, or simply do not exist.

In many respects the changes that have occurred are connected with the group Saatchi & amp; Saatchi, in the 1980s. engaged in the construction of an advertising empire. By the end of 1986, Saatchi & amp; Saatchi spent $ 1 billion, acquiring 37 companies. In 65 countries, she owned 500 offices, with 18,000 employees. After buying Saatchi & amp; Saatchi conducted intercompany mergers and reorganizations, as a result of which some agencies disappeared from the advertising market.

Further development of the holding company Saatchi & amp; Saatchi prevented the collapse of the stock market in October 1987, after which the value of its shares began to fall. Also, the organizational mistakes that occurred at the peak of agency purchases and their subsequent reorganizations also affected. As a result, advertisers-competitors appeared in the client list of one agency and one of them left the company, as the general rule of the advertising market states that competing advertisers are served by different agencies.

As a result of a decline in the stock market and organizational errors, the shares of Saatchi & amp; Saatchi by 1990 lost 98% in price, and the advertising holding, which was the largest player in the global advertising market, began to take positions. In 1995, the Saatchi brothers were removed from the management of the advertising holding, after which it was renamed the Cordiant Group, continuing to be one of the leading players in the global advertising market and entering the top ten of the world's leading advertising networks, groups and holdings. Two years later, the holding broke up into two groups: Saatchi & amp; Saatchi and Cordiant Communications, the first of which was acquired by Publicis in 2000 and the second in 2003 by WPP Holding .

Table 2.7

Leading advertising agencies and networks in 1981 and their holding in 2010

No. п/п

Agency/network name

State of 1981

Events of 1981-2010

Current membership

1

Young & amp; Rubicam

Independent

Included in the advertising holding WPP since 2000

WPP

2

J. Walter Thompson

Independent

Included in the advertising holding WPP with 1987

WPP

3

McCann Erickson

Included in the Interpublic holding

Included in the Interpublic holding

Interpublic

4

Ogilvy & amp; Mather

Independent

Joined the advertising holding WPP since 1989.

WPP

5

Ted Bates & amp; Company

Independent

Purchased in 1986 Saatchi & amp; Saatchi, on the basis of which in 1997 formed Cordiant Communications, purchased WPP in 2003

WPP

6

BBDO International

Independent

Triple merger BBDO, DDB and Needham, Hatper & amp; Steers followed by the formation of the Omnicom holding in 1986

Omnicom

7

Leo Burnett Company

Independent

The merger in 2000 with the MacManus Group with the formation of the holding company Bicom, which in 2002 acquired Publicis

Publicis

8

SSC & B Lintas

49% belongs to Interpublic

Totally belongs to Interpublic since 1982

Interpublic

9

Foote, Cone & amp; Belding

Independent

Acquired in 2001 by Interpublic, since 2006, after the intercompany merger with Draft is called Draftfch

Interpublic

10

D'Arcy MacManus & amp; Masius

Independent

The merger in 1985 with Benton & amp; Bowles with the formation of the agency DMB & amp; B and later MacManus Group, which in 2000 joined the holding company Blind. Closed after the purchase of Publicis in 2002

Not applicable

11

Doyle Dane Bemhach ( DDB )

Independent

See BBDO Internationa!

Omnicom

12

Gray Advertising

Independent

Joined the advertising holding WPP since 2005

WPP

13

Benton & amp; Bowles

Independence

my

See D'Arcy MacManus & amp; Masius

Not applicable

14

Marschalk Campbell-Ewald

Included in the Interpublic holding

Included in the Interpublic holding

Interpublic

15

Compton Advertising

Independence

my

Absorbed Saatchi & amp; Saatchi in 1982, now does not exist

Not applicable

16

Dancer Fitzgerald

Sample

Independent

Absorbed Saatchi & amp; Saatchi in 1987, which is now in the Publicis holding

Publicis

17

N. W. Ayer ABH International

Independent

The merger took place in 2000. It joined the holding company VotZ, acquired in 2002 Publicis

Publicis

18

Marsteller Inc.

Belongs to Young & amp; - Rubicam

Included in the advertising holding WPP since 2000

WPP

19

Wells, Rich, Greene

Independent

Hc is valid

Not applicable

20

Needham, Harper & amp; Steers

Independent

See BBDO International

Omnicom

thematic pictures

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