From Selection To Termination: An Investigation Of Advertising Agency/Client Relationships

Abstract

It is a fact of corporate life that firms now and again change their advertising agencies. Therefore the first objective of this study is to analyze the mixed and overlapping dimensions of the selection, evaluation, and termination processes. The second objective is to identify the differences that exist in evaluation criteria by comparing both parties to the relationship.  This exploratory and descriptive study attempts to understand the interactions from a theoretical background of organizational relations literature, namely, transaction cost theory, network theory, and resource based view (RBV).  An important managerial implication of this study is that it gives a clearer picture of similarities and discrepancies in the views held by both parties in the client firm and advertising agency context. The results of this study indicate that it is important for both parties to understand that both the client and the agency may have different reasons for making their respective decisions.