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Let us just examine our own logic for a moment:

If an advertising agency is compensated based on a percentage (it is usually 15%) of what I spend, what incentive do they have to find for me innexpensive, effective, leveraged advertising that is cumulative and gets me more and more business with less and less expenditure like any effective campaign should?

The obvious answer is: none at all! The fact is that there is a built-in conflict of interest in the way that advertising companies are compensated: it is not in the ad-agency’s best interrest to do a good job:

Not only is there a built-in probelm with the compensation method, there is also another inherent conflict of interests: ad agencies typically target a vertical market or two: that is they represent primarily a certain type of business: for instance doctors, manufacturing, retail…

But if I have more than one client seeking the same market share, who do I represent best?
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