An advertising agency is a service business that deals with creating, planning, promoting and implementing advertising for clients. Advertising agencies are a separate business from the client and are experts in promoting advertising for a business. There are different types of advertising agencies, and can be anything from a one person operation to a multi-national corporation. One type of advertising agency is a full service agency that mainly deals on a set fee and commission based compensation, the fee being paid by the client who requested the marketing. The commission is a payment from the media to the agency and is normally around 15 percent of the cost of the advertisement. It’s normally the broadcast media, radio or television that pays the commission.
 

Another type of advertisement agency is and interactive agency, which may differentiate themselves by offering a mix of web design and development, search engine marketing, internet advertising and marketing, E-business or E-commerce consulting. This type of agency did quite well before the traditional advertising agencies embraced the internet. Some interactive agencies grew very quickly due the variety of services they offered, but many have downsized just as fast due to the changing market conditions. Interactive agencies are similar to advertising agencies and function in much the same way, except they focus solely on interactive advertising services using such media as the internet, kiosks, CD-ROMs, DVDs, and devices like IPods, PSP and mobile. Interactive agencies deliver services like Digital Lead Generation, Digital Brand Development, Interactive Marketing and Communications Strategy, Rich Media Campaigns, Interactive Video brand experiences, Web 2.0 website design and development, e-Learning Tools, email marketing, SEO/SEM services, PPC Campaign Management, Content Management Services, web application development, and overall Data Mining and ROI Assessment.
 

Another type of advertisement agency is a tra-digital agency, advertising agencies who are experts in both traditional and digital advertising, offering the best of both worlds and come in very handy in today’s digital age. Lots of advertising agencies are looking for a door into the digital world; it’s the only way to keep up in this day and age.
 

There are also search engine agencies. Search engine marketing (SEM) and search engine optimization (SEO) firms are beginning to be classified as agencies because they create media and implement media purchases of text based advertisements. Although it took some time for this type of advertising agency to be classified, they were referred to as a type of advertising agency because they create advertisements.

 

Determining how much money you get for what you spend, you need to look at the cost per thousand figure. If it costs you $100 to have a newspaper ad through an advertising agency, and 2,000 people see it, then the cost per thousand is $50. However, if you pay $1,000 for a television ad, and 40,000 people see it, then your cost per thousand is only $25.