THE ADVERTISER’S PERSPECTIVE ON ADVERTISING AGENCY-CLIENT RELATIONSHIPS: A SURVEY OF LEADING ADVERTISERS IN TURKEY TANSES YASEMİN GÜLSOY Submitted to the Graduate School of Social Sciences in partial fulfillment of the requirements for the degree of Doctor of Philosophy in Contemporary Management IŞIK UNIVERSITY 2006 ii THE ADVERTISER’S PERSPECTIVE ON ADVERTISING AGENCY- CLIENT RELATIONSHIPS: A SURVEY OF LEADING ADVERTISERS IN TURKEY Abstract This dissertation focuses on the relationship between advertisers and their advertising agencies, in an effort to understand what drives advertiser’s satisfaction in this relationship which can have considerable impact on the business success of both parties. The research develops a model of relationship satisfaction positioned within the conceptual framework of Wackman, Salmon & Salmon (1986/87). This conceptual framework has been extended with additional variables to account for the complexities of the agency-client relationship in the Turkish advertising industry today. A survey of Turkey’s largest advertisers was conducted, using the face-to-face interview method. Factor analysis and regression analysis (of factor-scores) were then used to test the proposed framework. All of the dimensions of the model were found to significantly influence the advertiser’s satisfaction with the agency. The results suggest that advertisers principally value the agency’s creativity and the relationship with the agency. Compatibility, agency’s cost-consciousness, service breadth, leadership capability, and perceived contribution to advertiser’s sales, market share, and brand targets were also found to be important for satisfaction. Other significant predictors are people- related attributes, strategic input, trust, cooperativeness, and prestige and full-service capability. The empirical findings are consistent with the theory and confirm the importance of relationship attributes in advertiser’s satisfaction. None of the control variables was found to be significantly associated with satisfaction. iii The findings contribute to research concerning relationship marketing and have managerial implications. iv REKLAMVERENİN PERSPEKTİFİNDEN REKLAM AJANSI- REKLAMVEREN İLİŞKİLERİ: TÜRKİYE’NİN EN BÜYÜK REKLAMVERENLERİYLE ANKET Özet Bu tez çalışması, Türkiye’nin en büyük reklamverenlerinin reklam ajanslarıyla ilişkilerini incelemektedir. Bu ilişkinin başarısı, her iki firmanın iş sonuçlarına ciddi katkılarda bulunduğu için incelenmesi önem taşımaktadır. Bu amaçla, reklamverene odaklanarak, Wackman, Salmon ve Salmon (1986/87) modeli çerçevesinde bir memnunluk modeli geliştirilmiş ve günümüz Türk reklam sektöründeki ajans-müşteri ilişkisinin karmaşık yapısını yansıtabilmesi amacıyla modele yeni değişkenler eklenmiştir. Veriler, Türkiye’nin en büyük reklamveren firmalarındaki yöneticilere yüz yüze anket yöntemi uygulanması yoluyla toplanmıştır. Önerilen model, faktör analizi ve bunu izleyen çoklu regresyon analizi yoluyla sınanmıştır. Modelin bütün boyutlarının, reklamveren memnuniyetini etkilediği görülmüştür. Araştırmanın sonuçları, reklamverenlerin en önem verdiği faktörlerin, ajansın yaratıcılığı ve ajansla ilişkilerin niteliği olduğunu ortaya koymuştur. Ayrıca, memnunluğu önemli derecede etkileyen faktörler arasında, ajansın reklamveren firmayla ilişkilerdeki uyumluluğu, maliyette gösterdiği titizlik, hizmet yelpazesinin genişliği, reklamvereni yönlendirebilme gücü ve reklamverenin satışlarına, pazar payına ve marka hedeflerine yaptığı düşünülen katkı sayılabilir. Ajans çalışanlarının nitelikleri ve kişiler arası ilişkilerden memnunluk, ajansın reklamverenin pazarlama planlarına stratejik katkısı, reklamverende uyandırdığı güven ve işbirliği duyguları, itibarı ve tam hizmet niteliği de reklamveren memnuniyetini etkilediği belirlenen diğer etmenlerdir. v Görgül bulgular kurama uygundur ve reklamveren memnuniyetinde ajansın yaratıcılığı kadar ilişkisel etmenlerin de rol oynadığını kanıtlamaktadır. Kontrol değişkenleriyle reklamveren memnuniyeti arasında önemli bir ilişki görülmemiştir. Sonuçlar, ilişkisel pazarlama araştırmalarına bir katkı niteliğindedir. Elde edilen bulgulardan yola çıkılarak, reklam ajansı-reklamveren ilişkisinin iyileştirilmesi için gerek reklam ajanslarına, gerekse reklamverenlere birtakım önerilerde bulunulmuştur. vi Acknowledgements There are many people who helped to bring about this dissertation. First and foremost, I thank Professor Sedef Akgüngör of Dokuz Eylül University, my dissertation supervisor, academic advisor, and dear friend. Having the opportunity to work with her over the years was an intellectually rewarding experience. I also thank the members of my dissertation committee, Professor Toker Dereli, Professor Murat Ferman, and Professor Metin Çakıcı, all three of Işık University, who contributed much to the development of this research starting from the early stages. I thank Professor Ahmet Niyazi Koç of Işık University and Associate Professor Şebnem Burnaz of Istanbul Technical University for their insightful comments and suggestions on the early drafts of my survey questionnaire. Special thanks go to Professor Yavuz Odabaşı of Eskişehir Anadolu University for sending me helpful resource material as well as for offering precious guidance in the early stages of this research. I would like to offer special thanks to the respondents of my survey, who took time off from their busy schedules to fill out my questionnaire and share with me their valuable opinions during our interviews, each of which was a goldmine of information and insight. Without the kind participation of these fine professionals, this dissertation could not have come into being. I owe each and every one of them a debt of gratitude. I am also grateful to the Vice President of the Advertisers Association Ms. Dilek Erkey, of Unilever, for her prescient guidance at the incipient stages of this research. This list of thanks would not be complete without the following individuals, who contributed by reviewing early drafts of my questionnaire, making useful comments, suggesting respondents or providing data sources: My thanks go to the General vii Secretary of the Advertisers Association Ms. Deniz Güven, of Doğuş Holding; Ms. Ayşegül Molu and Ms. Fisun Bargu Soner of the Advertising Foundation of Turkey (Reklamcılık Vakfı); Mr. Çetin Ziylan of the Advertising Association of Turkey (Reklamcılar Derneği); Assistant Professor Doğan Yıldız of Yıldız Technical University; Mr. Nejat Selkan, Mr. Bora Esenli, Mr. Fikret Yıldırıcı, and Mr. Kemal Birol of Tamek Gıda ve Konsantre San. ve Tic. A.Ş.; Mr. Hayri Cem of Bileşim Medya; Ms. Pelin Özkan of the MediaCat; Ms. Sara Stein of the US Association of National Advertisers; and my family’s dear friend, Ms. Jülide Urgancı. The final thanks go to my family. I thank my parents Tuna and Turgut Gülsoy and my brother Taner Niyazi Gülsoy, who have solidly stood behind me in this difficult as well as immensely gratifying endeavor. This dissertation is a tribute to their unfailing support, patience, and love. Teşekkür ederim. viii Table of Contents Abstract......................................................................................................................iii Özet.............................................................................................................................. v Acknowledgements...................................................................................................vii Table of Contents ...................................................................................................... ix List of Tables ............................................................................................................xii List of Figures.......................................................................................................... xiv Equation.................................................................................................................... xv CHAPTER 1. INTRODUCTION ................................................................................ 1 1.1 Background: The Context of Advertiser-Agency Relationships in Turkey. 2 1.2 Existing Empirical Evidence on Agency-Client Relationships in Turkey... 5 1.3 Research Objectives..................................................................................... 8 1.4 Outline of the Study ..................................................................................... 9 CHAPTER 2. LITERATURE REVIEW ................................................................... 10 2.1 Emergence of the Agency-Client Relationship in Advertising Literature. 10 2.2 Main Topics of Study................................................................................. 13 2.2.1 Factors Affecting Agency Selection .................................................. 14 2.2.2 Factors of Satisfaction and Dissatisfaction: Recurrent Themes and Issues 18 2.2.2.1 The Agency-Client Life Cycle: Importance of a Good Relationship 21 2.2.2.2 Structural Determinants of Client Loyalty..................................... 27 2.2.3 Factors Affecting Agency Termination ............................................. 29 2.2.4 Current Literature: Agency-Client Relationships Today ................... 33 CHAPTER 3. CONCEPTUAL FRAMEWORK ....................................................... 53 3.1 Services and Relationship Marketing......................................................... 53 3.2 Dimensions of Advertiser Satisfaction with Advertising Agency ............. 57 3.2.1 The Model Proposed by Wackman,