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INDUSTRY ANALYSIS FRAMEWORK -- A Global Perspective Advertising Industry -- March 1995 (Source:Deborah L. DeHaas, Advertising Industry Representative) PURPOSE The purpose of the Industry Analysis Framework is to describe the fundamental forces driving an industry. It presents our auditors with a good framework with which to evaluate global industry risks and issues and, in turn, determine the applicability of these risks to specific clients. The Industry Analysis Framework accomplishes these objectives by: Presenting a brief description of the industry from a global perspective Discussing the critical elements of the Business Analysis Framework affecting the industry Presenting available global resources DESCRIPTION OF THE INDUSTRY The Advertising Industry consists of a number of different advertising agencies that share the common characteristic of creating and planning advertising/promotional campaigns for existing or potential clients (advertisers), purchasing specific media time or space for display of the clients’ advertising once it has been developed and billing the client for the service. The types of media used by Ad Agencies include: Television - The spread of cable television has given national and local advertisers a plethora of options including channels with very specific target markets. Infomercials (program length commercials) are currently very hot in the U.S. Newspapers - Attracts more regional and local advertisers than television. Some smaller advertisers do not use ad agencies to place newsprint ads. In the U.S., the trend has been consolidation within the major metro markets to the point that few cities have more than one local paper. Magazines - More like television in that the scope of their market coverage is national. Some magazines do print regional issues in order to sell space to regional advetisers. Radio - Scope of coverage similar to newspapers. Talk radio has grown in popularity in recent years. Billboards - One of