The cost of doing business

This paper describes the process of setting appropriate guidelines to aid advertisers and agencies in the face of growing numbers of compensation disputes.

The cost of doing business

David Ward

Faced with increasing pressures to better manage costs and increase marketing accountability wherever possible, advertisers are now focusing on a number of issues involving ad agency compensation – especially the often confusing calculations that go into figuring an agency's overhead costs. “In the Advertising Financial Management Committee's quarterly meetings, we found ourselves discussing the topic of agency overhead at pretty much every session,” explains Bill Duggan, executive vice president of committees for the Association of National Advertisers (ANA). “So we knew there was some interest among advertisers in bringing some greater transparency to...

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