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Belch: Advertising and
Promotion, Sixth Edition
VII. Special Topics and
Perspectives
20. International
Advertising and Promotion
However, it appears that more and more companies are willing to take these risks and
rely on one agency to handle their advertising around the world.
A second alternative for the international marketer is to choose a domestic agency
that, rather than having its own foreign offices or branches, is affiliated with agencies
in other countries or belongs to a network of foreign agencies. An agency may acquire
an interest in several foreign agencies or become part of an organization of international
agencies. The agency can then sell itself as an international agency offering
multinational coverage and contacts. For example, many U.S. agencies are expanding
into Latin America by forming associations with regional agencies and acquiring partial
or full ownership of agencies in various countries. Leo Burnett has majority stakes
in agencies in 11 Latin American countries and minority ownership or associations in
seven others. 78
The advantage of this arrangement is that the client can use a domestic-based
agency yet still have access to foreign agencies with detailed knowledge of market
conditions, media, and so on in each local market. There may be problems with this
approach, however. The local agency may have trouble coordinating and controlling
independent agencies, and the quality of work may vary among network members.
Companies considering this option must ask the local agency about its ability to control
the activities of its affiliates and the quality of their work in specific areas such as
creative and media.
The third alternative for the international marketer is to select a local agency for
each national market in which it sells its products or services. Since local agencies
often have the best understanding of the marketing and advertising environment in
their country or region, they may be able to develop the most effective advertising.
Some companies like local agencies because they may provide the best talent in
each market. In many countries, smaller agencies may, because of their independence,
be more willing to take risks and develop the most effective, creative ads. Choosing
local agencies also increases the involvement and morale of foreign subsidiary managers
by giving them responsibility for managing the promotion function in their markets.
Some companies have the subsidiary choose a local agency, since it is often in
the best position to evaluate the agency and will work closely with it.
Criteria for Agency Selection The selection of an agency to handle a company’s
international advertising depends on how the firm is organized for international
marketing and the type of assistance it needs to meet its goals and objectives in foreign
© The McGraw−Hill
Companies, 2003
Exhibit 20-13 Colgate
has consolidated all of its
global advertising with one
agency
681
Chapter Twenty International Advertising and Promotion