Abstract

A Network Analysis of Transactions among Advertising Agencies and Production Companies

- The Influence of Advertising Agency¡¯s Ownership and Size

Hong,Seok-min (Assistant Professor, School of Communication, Hallym University)

Yoon,Tae-il (Assistant Professor, School of Communication, Hallym University)

Yi,Gi-hong (Assistant Professor, Department of Sociology, Hallym University)

Prior studies regarding Korea¡¯s advertising industry have almost exclusively examined practitioners¡¯ perceptions of changes in the advertising industry as global advertising agencies launched business in Korea. This study on Korea¡¯s advertising market, however, used a unprecedented approach by looking into the relationship between advertising agencies and advertising production companies through the framework of social network analysis. It tested if there existed significant difference by ownership(global vs. local)and size(the largest 10 agencies vs. the rest)in maintaining business networks. Results from this study indicate that the global advertising agencies show stronger network density and centrality, more diversification, and more efficiency than the local advertising agencies in terms of inter-organizational relationship. Additionally, the interaction effect existed between the ownership and the size of advertising agencies by centrality index. Finally, the higher centrality index among agencies is, the higher billing and ranking are. The end of the paper offers further theoretical and practical implications of the analyses and suggestions to improve Korean advertising agencies¡¯ business performance.

Key words : advertising agency, social network analysis, globalization of advertising industry