Canadian client/agency fee payments lack structure

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TORONTO -- The majority of ad agencies in Canada (69%) now receive fees rather than commissions based on media bookings, according to The Association of Canadian Advertisers' annual Advertising Agency Remuneration Survey. Other findings include: fees are negotiated individually with each agency with no set fee structure, and that, while 86% of respondents have written agreements in place with agencies, only 65% have a formal evaluation process for the work performed. Few respondents have embedded the evaluation process in the remuneration agreement and only 1.39% of agencies are paid primarily by results. The survey, conducted by Ernst & Young Management Consultants of Toronto, is the largest single study of its kind conducted in the history of Canadian advertising.

Copyright November 1998, Crain Communications Inc.

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