Agencies grew in size, offering more varied and specialized services. Later, in order to cater to the needs of overseas clients, and as more multinational corporations came into being; advertising agencies acquired a multinational character. Simultaneously, some other forms of agencies came into being. They are the boutique agency, the a fa carte agency, and the in-house agency. Copywriters and art directors, instead of being tied up with a single agency, set-up their own shop to sell the creative function at a fee. These shops have come to be known as creative “boutiques.” In an a fa carte agency, each service is sold on an optional basis at an individual fee. The advertiser, as its name implies, owns the in-house agency. In fact, this is nothing but the advertising department of a company. Large corporations have in-house agencies, which operate and control the entire advertising programme by themselves. For example, Reliance has Mudra, Malhotras have Bharat Advertising, Golden Tobacco has Govan Advertising and Lohia Machines have Shrishti. By contrast, Lever which promoted and owned Lintas Worldwide diverted its holdings and in India too, the Hindustan Lever followed suit.
As Sajid Peerbhoy rightly remarked ‘An in-house agency can hardly be sacked.’ Here, objectivity and creativity may also suffer. When corporations have a variety of products and services to sell and have a multi-divisional set-up, the in-house agency is very economical to have.
Before we go into a discussion of agency compensation, one more salient point regarding the agency’s organization structure deserves detailed description. This is the facility of the art studio within the agency. A small agency or space-broker may “not have an art studio. Hiring an outside artist in that case does the artwork. But, in our understanding of the modern agency, everyone has a well-developed art studio.