Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
72. (p. 89) Critics argue the use of _____ can encourage agencies to ignore cost accounting
systems and avoid media such as direct mail and sales promotions.
73. (p. 89) Under which type of compensation system might an agency be more inclined to
recommend expensive media such as network television and national magazines to its
clients?
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
74. (p. 89) Which of the following statements is true about agency commissions?
75. (p. 89) Negotiated commission rates for advertising agencies:
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
76. (p. 90) A(n) ______ is a type of compensation arrangement where an agency charges a client
a fixed monthly amount of money for all of its services and credits to the client any media
commissions earned.
77. (p. 90) Under the _____ system of compensation, the client agrees to pay the agency a fee
based on the costs of its work plus some agreed-on profit margin.
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
78. (p. 90) If an advertiser wants a very detailed accounting of how its advertising and
promotional monies are being spent and what it is being charged by its ad agency, it is likely
to use a(n) _____ compensation system.
79. (p. 90) Under which of the following compensation arrangement is the agency compensation
tied to their performance?
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
80. (p. 90) The DDB Needham advertising agency receives compensation from its clients based
on their sales and market share performance. This is an example of a(n) _____ compensation
system.
81. (p. 90) Why would General Motors switch to an incentive-based compensation system with
several of its agencies?
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
82. (p. 91) As more companies adopt the integrated marketing communications approach to their
advertising and promotions,
83. (p. 92) A _____ audit of an agency focuses on factors such as costs, expenses and payments
to outside suppliers while a _____ audit focuses on factors such as the agency’s efforts in
planning, development and implementing the advertising program.
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
84. (p. 96) During a merger or acquisition of the agency by some other larger agency, the main
reason for the discontinuation of the agency-client relationship is:
85. (p. 98) Which of the following statements is true about speculative presentations?
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
86. (p. 99) A(n) _____ is an individual who specializes in helping clients choose their
advertising agencies.
87. (p. 99) Probably the most effective way for an agency to acquire new business is through:
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
88. (p. 100) _____ are agencies that specialize in offering services, such as database
management, and the ability to create, produce, and disseminate direct mail and other types of
communications that go straight to target customers.
89. (p. 100) Direct-response agencies:
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
90. (p. 100) A typical direct-response agency is divided into three main departments. They are:
91. (p. 100) _____ specialize in the development and management of sweepstakes, refund and
rebate offers and incentive programs.
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
92. (p. 100) Which type of specialized service would have most likely coordinated a program to
allow consumers to mail in UPC codes from three Reynolds products to receive a free
Blockbuster movie rental?
93. (p. 101) A(n) _____ is the type of firm an organization would hire to develop and implement
programs to manage the organization’s publicity and affairs with consumers and other relevant
publics.
94. (p. 101) Which specialized service would be responsible for promoting and managing the
concert a client wants to hold to benefit Habit for Humanity?
95. (p. 102) Organizations that specialize in the creation of interactive media such as CD-ROMs,
kiosks, and web sites are known as:
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
96. (p. 102) To implement BMW’s new branding campaign, the decision was made to use short
digital films and to create a Web site where consumers could view the films. Which
specialized service would have most likely been involved in this campaign?
97. (p. 102) Package design firms, market research companies, photographers, and printers are
examples of:
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
98. (p. 102) National Fruit Company makes “WhiteHouse” apple juice. Market research
determined that the company needed to mold its bottle so as to make it easier to grasp. Its
market research would have been conducted by a(n) _____, and its packaging changes would
have been done by a(n) _____.
99. (p. 103) Which of the following is likely to conduct in depth interviews, market surveys, and
focus groups etc. in order to gather objective information that is valuable to the advertiser’s
promotional programs?
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
100. (p. 103) Marketing research firms:
101. (p. 103) Which of the following is true about integrated services?
Chapter 03 – Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing
Communication Organizations
102. (p. 104) A study by the Corporate Executive Board’s Advertising and Marketing
Roundtable found: