Departments and Organizational Structure of Advertising Agency

Organizational Structure of Advertising Agency

Advertising agency must have a suitable internal organizational structure to keep functioning properly with a smooth workflow.

When an advertising agency decides to establish its organizational structure, it must ask itself important questions like:

1. What is the suitability and requirement of a department?
2. How the span of control should be within an agency?
3. Is there any mechanism or provision to make communication and coordination more effective within the organization? etc.

All advertising agencies don't have a same organizational structure. Their structure varies from one another. It is so, since, all organizations are unique, and their objectives, requirements, functional areas and specialized departments are not common.

Following diagram is a typical example of the organizational structure of advertising agency.

Image credits © Gaurav Akrani.

In the above chart,

1. Board of Directors is a top administrative body of the XYZ advertising agency.
2. The President or General Manager is its head.
3. The Vice President of Marketing Services looks after its Media, Research and Sales Promotions.
4. The Vice-President of Management and Finance manages its Finance Department and Office Management (Personal, Records, and Public Relations.)
5. The Vice-President of Creative Services takes care of its Copy Art, Production (TV and Radio, Press, etc.) and Traffic.
6. The Vice-President of Accounting Services handles its Account Supervisors and Account Executives.

With expansion and growth, the organizational structure of advertising agency becomes complicated. Small Agencies usually have a simple structure compared to giant ones who have ample funds and resources to carry out their large and growing operations in the field of advertising.

Departments of Advertising Agency

The different departments of advertising agency:

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1. Contact Department,
2. Media Department,
3. Copy Department,
4. Art Department,
5. Production Department,
6. Research Department,
7. Accounting and Finance Department,
8. Public Relations (PR) Department, and
9. Office Management.

Now let's discuss main departments of advertising agency along with specialized functions assigned to each of them.

1. Contact Department

Contact department of advertising agency keeps contact with their prospective clients, who are mostly advertisers.

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The functions of Contact Department are as follows:

1. Contact Department supplies the necessary information to the clients.
2. It tries to increase and retain the number of clients of the agency.
3. It brings new customers, and this is crucial for increasing revenue, expansion, and growth.
4. It acts as a liaison authority (connection) between the advertising agency and its clients.
5. It serves as a sales promotion department of the ad agency.
6. It finds out new clients and promotes the business of the ad agency.

The Contact Department of ad agency comes under accounting services. Account Executive is the head of it.

Efficient working of this department results in the quick growth of an ad agency.

2. Media Department

Media Department of advertising agency selects the best media for advertising the products and services of the clients.

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While selecting a media for advertising it must consider the following:

1. The product's nature,
2. The market competition,
3. Advertising budget of the client,
4. Media trends, etc.

The functions of media department are as follows:

1. Select and use the best media possible to communicate the ad message to the consumers. It is a crucial function because a wrong selection will result in the failure of an advertised product.
2. Prepare a media plan for clients.
3. Media scheduling.
4. Supervise the execution of the schedule.
5. Buy or book an advertising time and space in media for the client.
6. Keep contact with various media.

Media Department of ad agency comes under marketing services.

3. Copy Department

The primary function of a copy department of an advertising agency is to prepare an attractive copy-of-ad.

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The copy of the advertisement is very crucial. It is called the Heart of the AD. It is so since it directly communicates the ad message to the consumers.

The staff of this department includes copywriters, copy-supervisors, and others. They use their talent of imagination, skill of putting flair and fluent language while preparing a copy.

The advertising may fail if the copy is not appealing to consumers. The copy-staff works in close co-operation with the staff of the art and visualization branch.

The head of the copy department is a Copy Chief. He directs the functioning of it.

The copy branch is perhaps the largest department of an ad agency. It comprises of a hard-working team of qualified professionals and experienced staff.

Some agencies have a creative branch instead of it that does the entire work of preparing an advertisement. Here, making an ad copy, artwork and actual production of the ad are all linked together and executed entirely by this department alone.

4. Art Department

The Art Department of advertising agency uses the power of creativity and to make the AD more appealing and agreeable. Its activity is not a mechanical one. It uses the principles of real art (that works) as a guideline or base to present a product to the targeted audience.

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The art department usually carries out the following work:

1. Transform the ad message into a self-communicating and mind-stimulating imagery.
2. Prepare visuals and layouts for press advertisement.
3. Make painted bulletins, posters, car cards, illustrations, slogans, etc.

Art Director heads Art Department of an AD agency. He gets assistance from the assistant art director, artists, visualizers and layout men.

The artists of art department work together with copywriters to make the final copy of advertisement more attractive.

Both departments of Art and Copy operate under the overall guidance and supervision of vice-president of creative services.

Not all ad agencies have a separate art department. Some prefer to outsource their art-related work to freelance artists.

5. Production Department

The copy of the advertisement is finalized by artists and copywriters. Afterward, it is sent to the production department of an advertising agency for its further processing where its proper mechanical production begins.

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The principal role of the production department is to process and produce a final ad.

Following are the traditional work activities or functions of production department:

1. Keep in contact with the printing press, typographers, photoengravers, etc.
2. Assemble the typographic design patterns, engraved photos, illustrations, copy, etc. and prepare the final advertisement.
3. Show it to the client (advertiser) and get his approval for its release.
4. Send it (after approval) to print media like magazines, newspapers, etc. for advertising.

With advancements in technology, the use of print media is gradually slowly down. The digital media is now an emerging trend. As a result, some production houses have started adapting to this change. Now their work also includes activities like:

1. Keep in contact with digital artists, web designers, etc.
2. Assemble the work of digital art and prepare a final digital-ad.
3. Seek approval of it from an advertiser.
4. Send it (after approval) to digital media like the Internet, e-magazines, web videos, etc. mainly for online advertising.

A production manager heads this department.

Production dept., of the ad agency, comes under creative services.

Not all ad agencies have a separate production unit. Some prefer to outsource their production-related work to others.

6. Research Department

The success of an advertising agency greatly depends on the success of the client's ad campaign. Today, achieving success is not an easier task. It is getting very difficult now-a-days because of rising market competition. With so many alternatives and choices at hand, already well-established goodwill and trust on older brands, it is now tougher to attract and convince consumers. However, against all odds hope still exists.

To stand out from the plethora of availability and make the client's products and services attractive, needs not only an enormous amount of tedious work but also some good amount of research.

One must remember that without knowing, What to do? How to do? When to do? and Where to do? Nothing is possible to achieve. However, with right direction and approach, everything can be made possible.

Therefore, the importance of research department in advertising is rising.

The function of research department of advertising agency is to:

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1. Carry out research and obtain the necessary information.
2. Engage in a rigorous and critical analysis of the collected information.
3. Use the findings (results) in different ways to achieving objectives.

The research department collects information about:

• Market,
• Market competition,
• Market trends,
• Products and services,
• Competitors,
• Consumer behavior,
• Media trends,
• New trends in advertising, so on.

Agency makes use of above information for executing an excellent ad campaign.

The team of a typical research department usually comprises of:

• Investigators,
• Field workers,
• Analysts,
• Marketing assistants,
• Statisticians,
• Librarian and the staff of the library, etc.

This team works under the guidance and direction a Research Director, who is the head of the research department.

Research department comes under marketing services of an ad agency.

Although research activities are highly beneficial, they do consume an ample amount of time, money, and resources:

1. Usually, small ad agencies can't afford such resource-intense activities and, therefore, prefer not to keep a separate research-branch. They either do research on a smaller scale or use the data obtained by others.
2. On its contrary, large-agencies prefer to maintain their research-subsidiaries and don't take the risk of compromising the quality and genuineness of the obtained data.

7. Accounting and Finance Department

The role of accounting and finance department of an advertising agency is to look after its financial and accounting matters.

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The work activity of this dept., is as follows:

1. Generate or raise invoices (bills) on clients (parties).
2. Send a regular reminder to the client for the collection of unpaid dues.
3. Book the expenses of vendor parties on a timely basis.
4. Issue payments to vendor parties within or on the due date.
5. Doing regular reconciliation (compare) of banks, vendors, and customers' ledger accounts.
6. Deposit government dues on a timely basis in authorized banks.

The staff of this department usually comprises of:

1. Chief financial officer (CFO),
2. Accounts receivable manager,
3. Accounts payable manager,
4. Accounts supervisors, and
5. Accounts executives.

This staff works under the guidance and supervision of vice-president of accounting services. He is the head of this department.

8. Public Relations Department

The chief responsibility of a public relations (PR) department is to maintain a cordial relationship among three parties, namely, advertising agency, clients, and media.

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The PR department carries out following work:

1. Address the complaints of the customers.
2. Solve their complaints as early as possible.
3. Be a link or intermediary between ad-agency, clients, media and society.
4. Create goodwill and maintain the reputation of the agency.

Public Relations Officer (PRO) is the head of this department, and his subordinates assist him regularly to maintain a cordial and healthy environment.

The PR department functions under the authority of management.

9. Office Management

The definition of office management according to Mills and Standingford,

“The art of guiding the personnel of the office in the use of materials, methods, machines and equipment appropriate to their environment in order to achieve its specified purpose.”

Office Management involves following significant activities:

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1. Recruit office staff.
2. Train and develop newly joined staff.
3. Promote existing staff.
4. Transfer of a timely salary and perquisites (perks) to staff.
5. Provide welfare facilities to staff.
6. Correspond to various internal and external parties.
7. Filing and record keeping of all the essential documents.

The office management of advertising agency operates under its management services.

Two related articles on advertising agency:

1. Functions of advertising agency.
2. Client agency relationship in advertising.