WHAT'S BEHIND AA'S COMBINED SERVICES REPORT

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With sales promotion and direct response becoming tandem services at many specialized agencies, Advertising Age has merged its annual rankings of the two into a single report.

Industry trends are necessitating the change. Direct response and sales promotion agencies-and their divisional brethren at ad agencies-are direct competitors. While at one time they were fully devoted to only one of the specialties, in recent years they have added crossover business en masse.

This report still carries separate rankings based on sales promotion and direct response revenues, the sixth annual rankings of these services by Ad Age. But the intermingling of the two has brought about a third listing-marketing services agencies-based on combined strength.

All rankings are by gross income, agency parlance for revenue that includes fee income, media commissions and the markup on materials and services.

Ad Age estimated revenue when agencies didn't provide the data, but in each case contacted the agency for verification. If no response was received from the agency, it was dropped from the listing.

Revenue was estimated at 12.5% of billings when agencies submitted only a single number for billings (billings include media expenditures, materials and services and capitalized fees).

Divisions of ad agencies with sales promotion or direct response revenue of less than $100,000 weren't included in this report.

A complete methodology for the individual direct response and sales promotion rankings appears on Page S-10. Those rankings begin on Pages S-4 and S-5, respectively.

In the marketing services chart that appears on Page S-1, combination direct response/sales promotion agencies are captured by their total revenues.

Except for four agencies, those listed also are ranked by "total" returns as direct response or sales promotion agencies depending on their area of dominant service.

The four- Wunderman Cato Johnson, Ross Roy Communications, Lintas Marketing Communications and Clarion Marketing & Communications-are listed among both sales promotion and direct response agencies by sole returns from those specialties.

In their cases, no service claimed 75% of the agency's total-the percent deemed as "dominant."

Other leading agencies on the direct response and sales promotion charts were added to the third chart to show a pecking order for this large and growing marketing services sector.

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