international mkting notes
mediumtomedium.Companiesaremovingfromthecommissionsystemtoa
rewardbyresultssystem,whichdetailsremunerationtermsattheoutset.If
salesrise,theagencyshouldberewardedaccordingly.Thismethodofsharing
inthegainsorlossesofprofitsgeneratedbytheadvertisingisgainingin
popularityanditmaybecomethestandard.Servicesprovidedbyadvertising
agenciesalsovarygreatlybutfewforeignagenciesofferthefullservicesfound
inU.S.agencies.
Evenasophisticatedbusinessfunctionsuchasadvertisingmayfinditis
involvedinuniquepractices.Insomepartsoftheworld,advertisersoftenpay
forthepromotionwiththeproductadvertisedratherthanwithcash.Kickbacks
onagencycommissionsareprevalentinsomepartsoftheworldandaccountin
partforthelowprofitabilityofinternationaladvertisingagencies.InMexico,
India,andGreece,theadvertiserreturnshalfthemediacommissionstothe
agencies.Inmanyofthedevelopingcountries,long-termcreditisusedto
attractclients.
Theglobalfirmwithbranchesand/orjointventureswithlocalfirms
dominateadvertisingglobally.Overthelasttwodecadesmostofthemajorad
agenciesintheUnitedStates,theU.K.,andJapanhaveexpandedgloballyand
caneasilyrepresentaglobalcompanyalmostanywhereintheworld.Thetop
agencyintheworldin1995and1996wasaJapanesefirm,Dentsu,Inc.,
followedbytheU.S.firmMcCann-EricksonWorldwide.IfyouvisittheWeb
siteofsomeoftheseagenciesyouwillseehowextensivetheirrangeis.These
companiesrepresenttheconsolidationofadvertisingagenciesthathasbeen