It all started with newspaper. Someone wanted to place an ad in the paper so they reached out to an agent who represented newspapers. They compiled lists of papers and placed ads in them on behalf of brands who wanted to advertise. Newspapers would negotiate with the agent who would get on the list. The agent also contracted with the newspaper for large amounts of space at discounted rates. They would then resell these spaces to advertisers at a marked-up rate. They worked on commission from the media outlets for the advertising that he gathered for them. The first agency was created in Philadelphia in 1841 by Volney Palmer, who was brought by Francis Ayer. Francis published an annual publication listing newspapers from which agencies sought business, their rates and their circulation. As the industry grew brokers began to offer more than just ad placement services and branched out into research, promotions and marketing strategy. They worked on behalf of the advertisers rather than the publishers. This conflict of interest in payment led to the later shift of fees over commissions. Ad agencies became the experts in the mid 19th century. During the 20thCentury ad agencies grew and became more creative with elaborate “brand personalities” and drama in the 50’s and 60’s. It was in this era that agencies became global giants from mergers, such as Ogilvy, WPP and Omnicom. By the 1980’s measuring results became increasingly important from clients and have continued to get more sophisticated. Information brought to you by The SAGE Handbook of Advertising.
