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A business service, usually licensed by
the state, that acts for or represents another (who is called
the principal) by implied or express permission. See: AGENT,
SYNCHRONIZATION LICENSING, MUSIC PUBLISHER,
MECHANICAL RIGHTS SOCIETY, PERFORMANCE RIGHTS SOCIETY,
PUBLICIST, CONTRACT
under "Implied Contract,"
and "Express Contract."
An agency whose business is to produce
graphic, written, or commercial broadcast advertisements. In the
record industry, because of the complexities and high cost of
maintaining an in-house advertising department, many record companies
sublet there advertising campaigns to agencies that specialize
in this field. These agencies have to research the product or
service that is to be advertised, create and produce the ads,
develop an advertising strategy (which may include test marketing),
submit the ads in a timely fashion to the appropriate media outlet,
do the accounting, i.e., pay the media and bill the client, track
the results of the ad, follow up to evaluate the cost effectiveness
of the endeavor, and adjust the procedure in order to improve
the results of future advertising.
Advertising agencies usually charge a 15 to 20 percent commission
on all advertisements placed plus reimbursement for expenses.
Or, a flat fee is sometimes charged. If the agency places the
same ad over and over a reduced fee may be negotiated by the principal.
Other agreements may include an incentive bonus or a percentage
of the increase in sales resulting from the agents efforts. See:
ADVERTISING,
PUBLICIST, PUBLICITY,
PUBLIC RELATIONS, PROMOTION.
An agency that is employed by a person
to be his sole agent representative (the agent usually signs the
client, i.e., enters into a written contractual agreement with
the client, to protect agent's interests). See: AGENT
under "Artist Agent," "Booking Agent."
The act of ending the existence of an agency relationship.
How this is enabled, is usually defined by written contract. See:
DISSOLUTION, CONTRACT
under "Breach of Contract."
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