Does the softer side of the client-advertising agency relationship matter?

There are several tangible and intangible elements that contribute towards a long-term relationship between advertising agencies and their clients. This paper evaluates the intangible or 'softer side' of the relationship as perceived by the clients. It considers the role of creative competence of advertising agencies and also the relational aspects of the service provision. These are modelled as antecedents to client satisfaction, commitment, and eventually loyalty. A validated survey instrument comprising 22 items was used to collect quantitative data. Responses from 119 clients of advertising agencies was analysed using confirmatory factor analysis and hierarchical regression. The results revealed that the proposed model was robust in that creative competence and interpersonal relationships followed by client satisfaction and commitment explained 77% of variation in loyalty. The findings of this study have significant practical implications to advertising agencies.