The manner in which a company organizes for advertising and other promotional elements depends on several factors such as company size, number of products, role advertising in promotion mix, the budget and structure of its marketing organization. Advertising function is an intimate part of the marketing department. Many marketing personnel often provide inputs in campaign planning, agency selection and evaluation of proposed programs. Many companies have an advertising department, headed by manager. In multi-product companies, with decentralized marketing product management or brand management system operates. Some large organizations form a separate in-house agency responsible for advertising and other promotional activities.

Marketing activities in some companies are divided along functional lines such as advertising, sales, marketing research and product planning etc. The advertising manager looks after all promotional activities concerned with the company’s product and services, including budgeting, creation of ads and their production, media schedules and sales promotion but excluding sales.

The basic functions performed by the advertising department under the centralized system are the following.

Planning and budgeting: Its foremost responsibility is to develop advertising and other promotional plans in line with the marketing objectives, strategies and budget of the company and get it approved by the higher management. Even though the advertising department prepares the budgets, the top management makes the final decisions regarding it.

Administration and execution: The advertising manager is responsible for the organization, supervision and control of the advertising agency. He needs to work closely with production, media, copy, art and sales promotion. In case an outside ad agency is hired, the advertising manager reviews and approves the prepared advertising plans.

Coordination within the company: In spite of having an advertising department many companies use outside advertising agencies and their services. The ads may be developed in-house and the services of the media buying agencies may be used to place the ads in suitable media. The department may use the services of collateral agencies to develop the brochures and point of purchase. The advertising manager closely coordinates with the personnel of outside advertising agencies and also determines which service providers to use.

Centralized system: Usually companies that do not have many divisions, products or service lines, or brand often used a centralized system. Having a centralized system advertisement makes it easier for the top management to participate in decision making. Since fewer people are involved in deciding the programmes in a centralized system, better efficiency is ensured.

On the negative side, it is often difficult for the advertising department to fully comprehend the overall strategy may be slow. When companies grow in size beyond a point, centralized advertisement advertising department may be unsuitable and impractical.

The decentralized system: The decentralized system is followed in large corporations with many product lines and brands. Typically, the company has many strategic values business units, or divisions, with separate manufacture, research and development, marketing sales, product or brand management. Each brand is assigned to a brand manager who is responsible for managing the brand including, including planning, budgeting, sales and its profit performance. The brand manager often has one or more assistant brand managers to help in the planning, implementation and control of marketing program.