National Agency Report Cards: How the Report Cards Work

After years of evaluating ad agencies based on billings, we have added data on agency revenues and staff. This is a critical change, since the era of the fixed commission has largely ended and many clients use fee payments instead. And with the unbundling of full-service accounts, the true meaning of billings has faded. We still include them, because agencies continue to use them as a reference point for accounts and size. But our principal tool now is revenues, which are more reliably comparable. 1995 revenues were supplied to us by the agencies; where they did not provide a figure, we estimated revenues at a conservative ratio of 10% of billings. Revenues are for advertising services only, not direct response, public relations or other non-media income sources. Some agency results were restated to reflect acquisitions or spinoffs, so that year-on-year operating comparisons could be made. Staff counts are as of year-end.
Individual grades were given in three categories:
Financial Agencies were graded on a curve, using overall gains in revenues and billings and information on specific account wins and losses. Performance ratios, such as revenues per employee and revenues-to-billings, were also a factor.
Creative Seven TV spots and seven print ads from each agency were reviewed by Adweek staff. Consideration was given to creative quality, range of products worked on, clarity of message, production values and consistency of execution.
Management Grades reflect how well agency executives handled client issues, agency development, finances, mergers and acquisitions, and other strategic areas.
Regional Highlights For national network agencies, we break out significant activity in the regional offices of the network.
The final grade is the average of the three graded categories.
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