Sponsor (Jan-June 1956)

AGENCIES' 15% {Continued from page 29) historical accidents. There is a measure of agreement among agency executives that a more scientific system of compensation may be created one day. But the great virtue of status quo. SPONSOR was told repeatedly, is that it provides the best possible uniformity and stability. The thinking goes this way : The economics of the agency business dictate the amount of compensation necessary to cover servicing an account. If you drop commissions on talent and production costs and set up some new form of compensation, advertisers will be forced to take either less servicing or pay fees equalling the commissions today. Mainly, you'd be opening the way for constant price negotiations. Clients may become prey to presentations based not on maximum ability to serve but rather on minimum price of service. This could be the start of a competitive "gasoline war" which in the end would hurt everyone. And it could end up making the already complex KIFN Tested and Approved by NATIONAL ADVERTISERS! Fulltime SpanishBroadcasting is our ONLY Business! We're Known by the Companies We KEEP! Pepsi-Cola Pet Milk Co. Bottling Co. A-l Beer Folger's Coffee Carnation Co White King Quaker Oats Soap Fab Camel Cigarettes Pacific Greyhound Lines Nic-L-Silver Batteries Coca-Cola Bottling Co. Safeway Stores, BFr Coodrich Inc. Co' General Mills I )• Newberry Canada Dry Co. Bottling Co. Mode-O-Day Mountain States Tel. & Tel. Co. KIFN S listeners will learn to like your company, too. . . The cost is modest, but the results are BIGI ASK THESE YANQUIS HOW KIFN SELLS! NATIONAL TIME SALES HARLAN C. OAKES 17 E. 42nd St. 672 Lafayette Park PI. New York, N. Y. Los Angeles, Calif. KtfM 860 Kilocycles • 1000 Watts REACHING t H0INIX;AND ALL OF CENTRAL ARIZONA agency-advertiser relationship a fiscal j ungle. "If one agency offers to work for 10% of the net work cost, while another works for 12%, the possibilities for irritation would be endless," said an agency treasurer. "Agency-client relationships would become a perpetual questioning and counter-questioning. And furthermore, clients would face an additional fee system that would necessarily grow up to fill in the gap between agency income and the normal cost of over-all cost operations." 5. Cost of commercials: How do you price an idea? The idea for an egg dropping into boiling water and being lifted out by a Band Aid? The idea for a portable phonograph falling from a ladder onto a glass plate above the camera without shattering? Maybe it sounds corny to the businessman to hear "What price genius?" Yet reducing the cost of a commercial to mechanics plus man-hours can be as unrealistic as evaluating a painting in terms of the cost of the paints, canvas and man-hours of the artist. On his three commercial minutes weekly, a sponsor is gambling a multi-million annual investment. He is relying on the commercials to move tens of millions of dollars in merchandise. The president of one radio-tv agency pointed to three shelves in his bookcase lined with some 80 thick volumes. "Each of those cost us $7,500 out of pocket," he told sponsor. "They're Gallup studies of tv copy we and our client's competitors have used. They're the first step we take toward successful selling copy." Yet tv copy research is just one and a relatively small cost factor in putting together a commercial. In volumes on a shelf, research becomes tangible, proof of agency expenditure. But what about the writers, producers who use all this research? In making a commercial, the agency tv department virtually picks up where the print department leaves off in making a comparable magazine ad. Even the initial storyboard stages aren't comparable to print layouts. The number of people involved in the thinking and planning stages of a storyboard bring the cost of a single storyboard to the cost of making layouts for 16 pages of print advertising, according to top radio-tv executives. When a print layout is approved, the rest of the job can often be han dled by one or two good mechanic; men. In tv, the creative talent of a agency begins its work at this point. "The idea for a tv commercial i only as good as its execution," a Roger Pryor, Foote, Cone & Beldinj radio-tv v.p., points out. When the storyboard is approved agencymen go to work on casting They may screen dozens of models, an nouncers, actors before choosing tb one or two or three who'll interpret th< commercial best. Other agencymen will screen com mercials producers to see which on< can do the most creative interpretatioi of the storyboard, which one is mosi experienced in the particular tech niques the commercial requires. They'l review bids from producers, evaluate them in terms of anticipated produc tion values and past performance. Once the commercial has beet! farmed out to an outside producer, agency producers and often the tv copywriter as well ride herd on the production. They may go on location with the cameraman and crew or work in the studio, discussing the angle? that will be most effective for the commercial as a whole and the product in particular. They'll coach the talent in correct use of the product or how to show it off to best advantage. In short, 20 people may have to be on the agency's payroll to make one tv series, the equivalent of which two or three men could handle in print media. Where does the money come from to pay for all this talent? Not from commissions on the cost of commercials alone surely, agencymen state. And they feel that the scope of efforts on tv commercials would probably have to be curtailed if there were reductions iii commissions on talent expenditures. ft. Production offices: Tv has meant a substantial increase in agency overhead. With the increase in film production on the West Coast and the PULSE Proves Wilkes-Barre Penna. the front-running radio station reaching more than a Quarter Million radio homes. Call Avery-Knodel, Inc. no SPONSOR