Outlook Improves For Communications Agencies
The outlook is improving for the majority of communications agencies which are now more optimistic about the business climate than they were three months ago, according to new research published today.
The first Agency Barometer survey from the recently established Communications Agencies Federation shows that almost a third of agencies reported that communications budgets committed by clients had increased since they were first set.
A further 12% of agencies that took part in the new quarterly study described the new business market as ‘very buoyant’ – of these, the majority expect that up to 25% of their gross income will come from new business over the next few months.
The research indicates that the climate is improving for smaller agencies and those that are not advertiser specific. However, larger agencies and advertising specialists reflected the weakest levels of confidence and the greatest net declines in budget commitment.
New media, field marketing, direct marketing and sales promotion all saw net increases in budget commitment and have revised their income forecasts upwards.
There was also good new on the recruitment front and more agencies reported they would be recruiting staff during the next six months, compared to those saying they would be reducing staff numbers.
Commenting on the findings, chairman of the Marketing Communications Consultants Association, Matthew Hooper, said: “I am heartened by this recognition of a more buoyant marketing communications industry, which has gone through a tough time of late. Those agencies which recognised the changing nature of the business and developed structures flexible enough to deal with the rate of change we face today have emerged stronger and more profitable.”
However, IPA director general, Hamish Pringle, added: “It will be interesting to see if this optimism is reflected in the October Bellwether Report, which indicated continuing economic uncertainty during the second quarter.”
The Agency Barometer Survey polled 170 communications agencies in an attempt to establish trends in the respect of committed client expenditure and new business activity, as well as agency income and employment prospects. It was commissioned by the Communications Agencies Federation, which was set up last year to form a unified trade organisation representing the communications industry (see Agency Associations Unite To Form Federation).
Recent research from the Chartered Institute Of Marketing suggests the economy has enjoyed a powerful boost since the end of the war in Iraq, with businesses predicting that a 10% sales increase in the coming year will led to the strongest growth since the mid-nineties (see Survey Shows Business Confidence Is Returning To Britain).
Communications Agencies Federation: www.cafonline.org.uk
Recent Related Stories from NewsLine Freeview Could Be In 2 Million Homes By First Birthday AOL Time Warner Set To Drop AOL From Name Broadband Britain Boosted By New Wi-Fi Hotspots
Subscribers can access ten years of NewsLine articles by clicking the Search button to the left