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Part Two Integrated Marketing Program Situation Analysis
Belch: Advertising and
Promotion, Sixth Edition
II. Integrated Marketing
Program Situation Analysis
new advertising tagline is “Gateway a better way” and
the ads show computer users in a series of vignettes
with an urban look and feel. Gateway is also touting a
new logo as the old one, which featured a cow-spotted
shipping box, has been replaced. The new logo is a computer
power button rotated on its side to form a stylized
“G” but still retains a hint of a cow spot. However,
the talking cow has been retired and Gateway feels that
3. Organizing for
Advertising & Promotion
© The McGraw−Hill
Companies, 2003
it has found the right image for the future as well as
the right agency. Hopefully the company will no longer
have to keep looking for an udder agency.
Sources: Bruce V. Bigelow, “How now Gateway cow?,” The San Diego
Union Tribune, December 8, 2002, pp. H1, 10; Richard Linnett,
“Regarding Henry,” Advertising Age, Mar. 26, 2001, pp. 1, 37, 41; Tobi
Elkin, “Troubled Gateway Turns to New Shop as Earnings Fall,”
Advertising Age, Feb. 12, 2001, p. 4.
approach, they are looking for agencies that have integrated capabilities and can handle
more than just their media advertising.
• Declining sales. When sales of the client’s product or service are stagnant or declining,
advertising may be seen as contributing to the problem. A new agency may be
sought for a new creative approach.
• Conflicting compensation philosophies. Disagreement may develop over the level
or method of compensation. As more companies move toward incentive-based
compensation systems, disagreement over compensation is becoming more
commonplace.
• Changes in policies. Policy changes may result when either party reevaluates the
importance of the relationship, the agency acquires a new (and larger) client, or either
side undergoes a merger or acquisition.
If the agency recognizes these warning signs, it can try to adapt its programs and
policies to make sure the client is satisfied. Some of the situations discussed here are
unavoidable, and others are beyond the agency’s control. But to maintain the account,
problems within the agency’s control must be addressed.
The time may come when the agency decides it is no longer in its best interest to
continue to work with the client. Personnel conflicts, changes in management philosophy,
and/or insufficient financial incentives are just a few of the reasons for such a
decision. Then the agency may terminate the account relationship.
How Agencies Gain Clients Competition for accounts in the agency business
is intense, since most companies have already organized for the advertising function
and only a limited number of new businesses require such services each year.
While small agencies may be willing to work with a new company and grow along
with it, larger agencies often do not become interested in these firms until they are able
to spend at least $1 million per year on advertising. Many of the top 15 agencies won’t
accept an account that spends less than $5 million per year. Once that expenditure
level is reached, competition for the account intensifies.
In large agencies, most new business results from clients that already have an
agency but decide to change their relationships. Thus, agencies must constantly search
and compete for new clients. Some of the ways they do this follow.
Referrals Many good agencies obtain new clients as a result of referrals from existing
clients, media representatives, and even other agencies. These agencies maintain