Deck 5: The Advertising Agency, Media Services, and Other Services

Question 1

George Rowell might be considered in advertising as the father of:

A)working on commission.
B)selling by list.
C)planning.
D)copy writing.
E)the agency as a creative center.

Answer 1

B

Question 2

Which of the following is NOT in the list of specialties agencies have acquired through purchase?

A)online communication
B)government and ethics
C)health care
D)interactive
E)mail order

Answer 2

B

Question 3

Which of the following is included as part of the evaluation plan?

A)comparison of creative objectives to outcomes
B)double checks of the media schedule
C)presentation of copy and layout roughs
D)assignment of total costs
E)refined objectives

Answer 3

A

Question 4

"All the advertising agencies," so it is said, but U.S. Census Bureau data and the New York Yellow Pages indicate about what percentage of all U.S. agencies are located there?

A)10 percent
B)17.5 percent
C)20 percent
D)50 percent
E)75 percent

Question 5

Characteristics of the American Association of Advertising Agencies include all of the following EXCEPT:

A)about 93 years old.
B)at first, national trade association representing only U.S. advertising agencies.
C)now known as 4As.
D)simplified its name to AAAA.
E)in 2009, admitted associate members from outside United States.

Question 6

Which of the following is NOT a separate department in the traditional organizational structure of an agency?

A)creative services
B)marketing services
C)research services
D)finance and management services
E)account services

Question 7

The first ad salesman to work for a commission was:

A)J. Walter Thompson.
B)George Rowell.
C)Morris P. Middy.
D)Volney B. Palmer.
E)George Lois.

Question 8

Assuming you charged the standard agency commission rate for placement of a newspaper ad that cost $10,000, what costs are you NOT allowed to bill the client for?

A)recording studio time
B)photography
C)typesetting
D)utilities
E)broadcast production

Question 9

After research is completed in a full-service agency, which department is likely to lead the way in setting objectives and developing strategy?

A)account planning
B)account management
C)creative
D)traffic
E)evaluation

Question 10

Which person or event helped to establish radio as a prime news vehicle?

A)Edward R. Murrow on the CBS Evening News
B)Scopes trial
C)the Roaring Twenties
D)the Korean Conflict
E)Howard Cronkite on ABC News Tonight

Question 11

In simple terms, a full-service agency:

A)provides clients very specialized services without regard to overall client needs.
B)offers to manage integrated marketing communications.
C)offers clients a minimum of the services required.
D)is less expensive than partial-service agencies.
E)limits its scope to increase efficiencies.

Question 12

Which of the following is NOT part of the media plan process?

A)define media strategy
B)check objectives to ensure they mesh with marketing objectives
C)write copy
D)select media
E)prepare media schedules

Question 13

What organization established the standard agency commission in 1917 at 15 percent?

A)the Federal Trade Commission
B)magazine publishers
C)newspaper publishers
D)advertising agencies
E)AAAA

Question 14

In a traditional agency, if Mary Lou is ultimately responsible for the finished product-ads and commercials-she is likely the:

A)creative director.
B)finance director.
C)traffic director.
D)marketing services director.
E)media director.

Question 15

Scholars indicate that help for establishing the advertising agency as the creative center for advertising ideas in the 1870s is credited to:

A)Francis Ayer.
B)Charles, Austin, and Bates.
C)J. Walter Thompson.
D)David Ogilvy.
E)Calkins and Holden.

Question 16

Which of the following may NOT typically be the responsibility of the vice president for marketing services in a traditional advertising agency?

A)media planning
B)writing and art
C)sales promotion
D)media buying
E)research

Question 17

Your client's ad runs in an issue of Leisure Gourmet magazine and costs $10,000. What is the standard agency commission for the placement?

A)$1,000
B)$1,500
C)$1,765
D)$8,500
E)$1,265

Question 18

Which of the following is NOT an issue facing advertising agencies today?

A)compensation
B)reorganization
C)ignoring integrated communication
D)client loyalty
E)media fragmentation

Question 19

Why are agencies moving toward providing integrated services?

A)It was simply a matter of keeping up with the Joneses.
B)It was a philosophic move.
C)It would create inefficiencies.
D)It would increase overhead expenses.
E)It's a response to changing clients' needs.

Question 20

In a traditional agency, the ________ is responsible for the relationship between the agency and the client.

A)CEO
B)account services vice president
C)marketing services vice president
D)finance and management vice president
E)IMC director

Question 21

Which of the following pertains to international agency networks?

A)several network members in each region
B)several network members in each market
C)Large holding companies own them.
D)are a system of small- and medium- size independent agencies
E)are established primarily to provide information and financial skills to enhance their member agencies' operations

Question 22

Kang & Lee, Uniworld and Diesti are specialty agencies that that focus on:

A)real estate marketing.
B)entertainment and tourism.
C)multiculturalism.
D)performing arts.
E)health care.

Question 23

Which of the following does NOT pertain to the length of client-agency relationships?

A)4A's data indicate average tenure declined from 7.2 years to 5 since 1984.
B)GE and Pepsi have been with BBDO for at least 50 years.
C)Client can terminate it.
D)Agency cannot terminate it.
E)Agency can terminate it.

Question 24

Most traditional agencies today are treated by most clients as:

A)an asset rather than liability or expense.
B)vendor-order takers.
C)the sole source for solving marketing/advertising problems.
D)partners sharing the stewardship of the brand.
E)strategic vendors.

Question 25

Regarding smaller agencies, Majors indicates their key to success is:

A)strong planning.
B)strong financial management.
C)strong research.
D)strong creative.
E)strong client management.

Question 26

Which of the following is NOT a leading mega-agency holding company today?

A)Omnicom Group
B)WWP Group
C)Dentsu
D)Interpublic
E)Publicis Groupe

Question 27

Before a U.S. advertising agency establishes an office abroad, what must it consider?

A)similarities in buying habits
B)differences in quality of life for transferred U.S. executive
C)differences in mores
D)similarities in education of prospective personnel
E)similarities in business laws

Question 28

Brad Majors, CEO of Brand Reps, LLC, indicates that medium-sized agencies:

A)will continue to produce provocative work as they grow.
B)have traditionally been the least successful in providing creative for clients.
C)will enjoy the stability they've enjoyed for the past two decades.
D)will be less likely to be acquired by major agencies.
E)are destined to stagnate as the number of personnel increase.

Question 29

In a reengineered advertising agency, benefits realized could include:

A)senior and junior staff stay focused on the details.
B)reduced specialization and narrower job scope.
C)senior and junior staff members understand how their work relates to everyone else's work.
D)the client doesn't call a specialist on the account team for an answer to any question.
E)higher payroll expense and decreased overhead.

Question 30

A parent agency with multiple offices:

A)does not expect each office to function as an autonomous agency.
B)does not expect each office to draw on talents from other offices.
C)does not expect each office to draw on services from other offices.
D)does not work on the same project for the same client.
E)does not try to secure accounts globally.

Question 31

Which of the following would NOT pertain to an agency of record?

A)make the corporate contracts under which other agencies issue their orders
B)coordinate the total media buy for products
C)vote shares in the client company according to its managements' desires
D)maintain a record of all advertising placed
E)coordinate programming of products in a network buy

Question 32

Advertising agencies reengineered in the 1990s:

A)to be more competitive.
B)to focus more on branding.
C)to acquire companies offering marketing expertise.
D)to better service the integrated and Web needs of their clients.
E)to offer more than marketing services.

Question 33

Doremus is an agency that specializes in:

A)health care.
B)multiculturalism.
C)real estate marketing.
D)corporate and financial marketing.
E)the Arab market.

Question 34

In the worldwide global agency system developed by J. Walter Thompson, the regional directors are:

A)the head of an agency within the agency.
B)responsible for a specific group of countries.
C)responsible for the director-in-charge system.
D)the CEOs of JWT's office in the regions.
E)required to speak English in all meetings.

Question 35

Globalization in advertising essentially is:

A)about the need to learn and understand consumers, markets, and cultures from a global perspective.
B)more about power than about advertising.
C)a relatively new phenomenon.
D)all about lingua franca.
E)mandated by the Internet.

Question 36

Which of the following is NOT characteristic of WWP's global research study?

A)a research study for Interpublic
B)a research study of 70,000 people worldwide
C)asks consumers questions in 50 categories
D)seeks to better understand how consumers view 3,500 brands
E)available to clients of JWT

Question 37

Agencies of the 1980s might best be described as responding to:

A)their own needs to be creative above all else.
B)serving the integrated needs of clients.
C)clients merging to be more financially competitive.
D)technology by becoming order takers.
E)maintained fierce independence.

Question 38

Because the client-agency relationship is a professional one, it may involve sensitive and confidential information in all of the following areas EXCEPT:

A)profit and loss.
B)new marketing strategies.
C)client's executive incentives program.
D)new product strategies.
E)sales data.

Question 39

To market and use advertising globally and effectively, companies need to consider:

A)positioning the product as they do in their home base.
B)creating advertising locally from a worldwide plan and strategy.
C)ignoring the effect of regional competitors.
D)allowing for flexibility in promoting consistencies of the brand.
E)bringing in people from United States who have a multicultural background.

Question 40

While a single advertising execution helps build the same global brand equity, the reality is:

A)language and art elicit the same emotional responses.
B)language is easily translatable so it means the same thing globally.
C)consumers are excited when advertising is presented from a global perspective.
D)every international brand starts as successful local brand and is reproduced often.
E)global executions typically elicit empathy when shown globally.

Question 41

Colonial postmasters were the very first Americans to act as advertising agents.

Question 42

In bartering, the one item that neither an agency nor an advertiser offers media is ________.

A)a free trip
B)hotel accommodations
C)cash
D)tickets to prime attractions
E)free meals

Question 43

The kind of agency arrangement where several advertising specialists-usually account and/or creative people-have no basic staff but hire specialists is called a(n):

A)independent creative services agency.
B)à la carte agency.
C)boutique.
D)in-house agency.
E)Rolodex agency.

Question 44

Which of the following advantages does a talent and production agency bring to some clients?

A)finance expertise
B)management expertise
C)Hollywood-type talent and related skills
D)research expertise
E)access to big money people F)instant success

Question 45

One of the major changes that began in the mid-1990s was the way advertising agencies handle:

A)media.
B)administrative services.
C)creative services.
D)financial services.
E)reengineering.

Question 46

Types of work for which an agency can negotiate a fixed fee include:

A)a finder's fee for the tip that a client was in need of a particular service.
B)account planning at an hourly fixed rate.
C)artwork charges based on the salary of the personnel involved.
D)advertising-recall scores.
E)a fixed commission plus expenses.

Question 47

Which of the following is an inherent reality that mega-agencies seem to forget when they decide to create an agency to serve a single account?

A)need for even closer financial controls
B)need for top creatives who don't mind working on a single account
C)need for even better management expertise
D)need for even more efficient planning
E)need for even better research data

Question 48

The type of compensation an agency can ask for based on an agreed-upon goal is called a(n):

A)tradeout fee.
B)output fee.
C)performance fee.
D)controlled fee.
E)acceptance fee.

Question 49

What might be the chief disadvantage of mega-agencies for their clients?

A)billing blunders
B)less focused, individual attention
C)conflicts with competing accounts
D)herd mentality for service
E)loss of the personal touch

Question 50

A major reason to create an in-house agency includes:

A)to increase commissions.
B)to lessen pressure on the ad agency of record.
C)to allow for more control over every aspect of their business.
D)to allow for greater creativity.
E)to amass a technological advantage.

Question 51

Clients are told a Rolodex agency has a major advantage over a small full-service agency because of its:

A)access to advertising specialists in a variety of areas.
B)access to expertise that the small full-service agency just can't match.
C)access to experienced account management people.
D)access to experienced financial management people.
E)access to advertising specialist as needed.

Question 52

Despite all the changes in business, the principal mission of advertising agencies is to sell products, services or ideas for their clients in a creative ways.

Question 53

The à la carte arrangement primarily offers:

A)creative services for a fee.
B)accounts management for a fee.
C)all types of advertising services for a fee.
D)a situations analysis for a fee.
E)evaluation services for a fee.

Question 54

Which of the following is NOT a form of compensation an agency might receive for its variety of work?

A)pro bono fees
B)flat-fee arrangement
C)labor-based fee-plus-profit-arrangement
D)sliding scales based on client expenditures
E)mark-ups

Question 55

MindShare is an example of a relatively new way advertising agencies deliver:

A)creative services to give clients that certain distinction.
B)media planning and buying services to clients.
C)simplified administrative services.
D)streamlined financial and management services.
E)digital services.

Question 56

Francis Ayer pioneered the relationship of advertisers as clients rather than as customers who would direct their business to various salespeople.

Question 57

What is a major advantage that mega-agencies offer their clients?

A)halo effect from reputation of agency's other clients
B)greater reservoir of talent to draw upon
C)ability to shift entire account teams on a moment's notice
D)sheer size alone
E)efficient agency review process

Question 58

Which of the following would you likely find in an advertising boutique?

A)a finance and management department
B)a media department
C)a research department
D)account executives
E)professionals developing creative ideas

Question 59

A group of people drawn together from all agency affiliate organizations and whose purpose is to create ideas rather than ads is:

A)a service cluster.
B)a communications integration team.
C)an in-house generalist team.
D)an agency conglomeration.
E)a creative clustering.

Question 60

The 10,000 advertising agencies in the United States are striving to contend with the role and relationship they have with their clients and prospective customers in this new economy, with all the new media and their integration as part of advertising.

Question 61

To gain buying efficiencies, some major agencies have unbundled media or given media buys to independent services or new media agencies.

Question 62

To compete in the new global economy, most U.S. agencies purchase either a majority or minority interest in a successful foreign agency rather than organize their own new agency.

Question 63

According to Brad Majors, CEO of Brand Reps, LLC, large/public agencies using economies of scale will more profitably service smaller clients.

Question 64

One of the main responsibilities for the research director in a typical traditional advertising agency is to help define marketing and copy goals.

Question 65

In contrast to a traditional agency, a reengineered advertising agency uses a team approach to serve the clients' needs and to solve the clients' problems.

Question 66

There is no universal model for the operational structure of a full-service agency.

Question 67

Today, agencies not only receive the standard agency commission from media for space bought for clients, but they also bill other provided services at 17.65 percent of gross.

Question 68

Today, despite the various arrangements of agency compensation, there essentially are only two basic forms: fees and commissions.

Question 69

One form of independent creative services agency is a creative boutique that has no media department, no researchers, and no account executives.

Question 70

Huey+Partners has shown the importance of a clear and distinguishable point of difference for both agencies and their output-in their case, creativity.

Question 71

The concept for mega-agency holding companies, such as WWP, is a relatively new idea envisioned by the Saatchi brothers in 1986.

Question 72

Barter is an original business model that has regained some prominence in tough economic times.

Question 73

Because the account planning department plays a crucial role in strategy development in large agencies, it is usually responsible for the research function.

Question 74

Since the Colonial era, advertising has gone through a no-rebate age, the age of negotiation, and the reengineering age to find itself in the media and digital age.

Question 75

In diagnosing the marketing and brand strategy of a client, effective full-service agencies strive for collaboration.

Question 76

Historically, clients sought agencies driven by famous individuals but then moved to agencies driven by collections of bright, talented people.

Question 77

As a traditional agency grows and takes on more clients, the account supervisor appoints account executives to serve as individual contacts with the various clients and their accounts.

Question 78

In mergers, an acquiring agency must weigh the critical question of conflicts of interest that might concern its current clients.

Question 79

Ogilvy & Mather's effective global advertising stems from creating advertising locally that follows the worldwide strategic plan to maintain the desired brand image.

Question 80

Pepsi and Perdue (a chicken company)suffered from the embarrassment of having had copy in American advertisements improperly translated into readily understood copy for other countries around the world.