8. The outsider's viewpoint.—The advice rendered by the agent is valuable, partly because it is based on his own experience, his records of the experiences of others and his knowledge of merchandising methods. But it is valuable also because the agent brings to any advertiser's problems the outsider's viewpoint. It is said that a doctor cannot diagnose his own case. Similarly, a manufacturer becomes involved in the details of his business and in his fight against competition, and it is hard for him to see his business as a part of the great distributive system. The advertising manager represents the business from the inside. The advertising agent represents the public as related to that business. The manu facturer considers his product as something to sell.
The agent considers the product as something to buy.
9. How an agency advertising agency has, at least in theory, three main departments : 1. A soliciting or promoting department to de velop business 2. A creative department to prepare advertise ments 3. A buying or rate department to keep in touch with advertising mediums.
Of late years advertising agencies have avoided the word "soliciting." Soliciting departments are now more often spoken of as "service" departments. The men who try to interest advertisers in the services offered by the agencies that employ them should be much more than mere solicitors. Most of them are men of experience and judgment—men who can collect data, study the business of a prospective client, help him to prepare his business for advertising, ad vise him with respect to merchandising plans, give to the copy writers in the agency the information that they need, sometimes write much of the copy themselves, and in all respects act as helpful points of contact between the agency and its clients.
An extensive advertising agency might have the following departments: 1. Soliciting or service department 2. Plan department 3. investigators 4. Copy department 5. Art department 6. Typographical department 7. A handling department to deal with engravers and printers 8. Forwarding department 9. Checking department 10. Auditing and invoicing department.
10. Relation of agency to has been much discussion about the division of functions between the advertising agent and the advertiser's own advertising department. In some cases, as was shown in the last chapter, advertisers have attempted to get along without advertising departments of their own, making the agency responsible for all details of the campaign. In other cases, the advertiser has an extensive advertising department, and uses the agency chiefly for counsel to aid in the copy writing and to place the advertisements in publications. Be tween these two extremes there is every shade of varia tion in practice. In theory, the advertising manager of a business and the advertising agent with whom he works should confer on all important matters, the ad vertising manager bringing to the conference the facts regarding the business, its goods, its personnel and its policies, and the agent bringing the outsider's viewpoint with a detailed knowledge of advertising principles and mediums and a fund of data regarding merchandising plans and methods.
If the advertising manager is skilled in copy writ ing, he and his staff can and should produce many of the actual advertisements, leaving, perhaps, the details of the merchandising plan to the agency; or, if the advertising manager and his organization are best prepared to produce broad marketing schemes, the production of advertisements may be left largely to the agency. In any case the agent's plans and his suggested methods of carrying them out are sub ject to the approval of the advertising manager or of some other responsible member of the advertiser's organization. A spirit of mutual helpfulness and a common and unselfish desire really to advance the interests of the advertiser will do more to bring the advertising manager and the agent into helpful co operation than any amount of cut-and-dried rules de fining their respective functions.
11. The advertising agent's a sense the advertising agency is the middleman in the advertising business. He does not buy space in large quantities to resell in smaller quantities but he does sell the publisher's commodity—space. For this service he is paid by the publisher. The ordinary service rendered by the agent—study of the client's business, writing copy, placing copy, etc.—costs the advertiser nothing. That is, the advertiser could not buy space any more cheaply if he performed this service for himself, than he can buy it and also utilize the services of the agency. The space used by the advertiser is billed to him by the agent at the publish er's card rates. The publisher bills the agent for the space used by his client, at the card rate less a certain discount, and it is this discount that represents the agent's gross compensation. Out of it he has to pay all the expenses of conducting his agency, keeping what remains as profit. The discount allowed by the majority of magazine publishers is thirteen per cent. That is, if an advertiser uses one thousand dollars' worth of space in a publication, the agent sends him a bill for 81,000. The publisher, in turn, bills the agent for $1,000 less 13 per cent, leaving $130 as the agent's gross compensation. Some agencies in such a case, instead of billing the advertiser for the card rate, would send a bill for the net cost to the agency, $870, plus 15 per cent, which is approximately $1,000 —thirteen per cent of the gross charge being about the same thing as fifteen per cent of the net.