Ireland’s ad agency leaders believe a recovery in their industry could take until the end of 2022, according to new IAPI figures.

Leaders of advertising agencies in Ireland are optimistic that their businesses will fully recover from the pandemic crisis, albeit it may take longer than originally hoped.

The latest agency survey from IAPI (Irish Advertising Practitioners in Ireland) reflects a positive mindset for the new year from an industry, like many others, that experienced significant upheavals and challenges.

“The commercial creativity and communications sector is very quick to self-criticise when in fact, they have been out-performing most other service industries during the pandemic”

The current predictions place the average agency revenue decline at 15-18pc compared to 25-30pc in June. 

While 80pc of media agencies predict an industry spend decline of 20-30pc this year, all media respondents state that their own agency revenues will decline by less than 20pc.

Pulse surveys

Two pulse surveys were completed by 75pc of agency leaders in June and again in October this year.  Their purpose was to understand agency leader’s views of their own business performance and that of the industry as a whole.

The findings show an optimistic, yet realistic, view within the industry with positivity shifting upwards over the past few months. In October, 76pc of leaders stated they were optimistic about the future of the industry with nearly all (98pc) stating that their agency would fully recover from the crisis.

There appears to be little doubt amongst leaders that their own agency will recover, however the perceived timeline for that recovery has shifted in line with the prolonged impact of the pandemic.  In June, 44pc of leaders felt they would be back to 2019 revenue figures by at least the middle of 2021 compared to only 27pc in October. 

The 12pc who believed that recovery would take until the end of 2022, has now increased to 33pc of leaders seeing this as their recovery timeline.

Media agencies, having been the hardest hit in Q2, look set to recover well, with over half predicting a less than 10pc decline in October’s survey compared to two-thirds predicting 10-20pc decline in June.

Creative agencies have also picked up since June when 83pc predicted a decline in revenue of 20pc+ for the year compared to October’s survey when this prediction dropped to only 50pc of creative agency respondents.

The least optimistic agencies are those who provide Experiential and Event services who are predicting a fall in revenue of up to 60pc this year.

And nearly all (93pc) of creative agencies predict an industry spend decline of 20-40pc, but only half predict the same decline in their own agency.

“I am in the privileged position of having oversight over the whole industry, so I take great comfort in the individual agency revenue predictions.” says Charley Stoney, CEO, IAPI. 

“The commercial creativity and communications sector is very quick to self-criticise when in fact, they have been out-performing most other service industries during the pandemic.  Collating the individual agency predictions in this way will provide a confidence boost to our members and I would hope demonstrates the sustainability of our sector.”

Workplace wellbeing

Over two-thirds of respondents are either proud or very proud to be working in the industry with juniors the least proud at 54pc and leaders the most proud at 91pc.   This positive view is also reflected by over half the respondents stating that they would recommend the industry as a great place to work.  Again however, a third of juniors stated they would recommend with reservations while 83pc of leaders would recommend or highly recommend the industry.

Job security is not as much of an issue as might be thought with 57pc of juniors, 67pc of managers and 84pc of leaders feeling secure or very secure in their role.

With the vast majority (92pc) working from home, one third of total respondents feel their experience of working has got worse; another one third feel the experience is the same; and the remaining third feel it is the same as before. 

Looking at the different levels though, nearly half of juniors feel it has got worse which is accounted for in the personal challenges of working remotely stated by juniors where 4 in 10, are concerned about their home environment not being suitable for work purposes.

In general, the personal challenges of working remotely are similar at all levels. Leaders (81pc) are most concerned about being able to motivate teams remotely, whereas juniors (75pc) are the most concerned about maintaining relationships with their work colleagues.

Again, the business challenges of working remotely are similar across levels although creating new business opportunities is of most concern for leaders. 

Maintaining agency culture is the most serious concern for everyone.  One of the key advantages the industry had, to date, over corporate or big tech organisations is the informal, creative and fun working environment which in attracting and retaining talent has proved invaluable.  IAPI members are very focused on this issue and during the latest round of IAPI leaders’ conversations, best practice for innovative initiatives and communications were openly shared to help everyone maintain this advantage.

When it comes to comparing work/life balance, it seems to have improved marginally, particularly now that agency staff no longer have to commute.  Managers and Leaders do fare better than juniors when it comes to overall work/life balance with less than half of juniors saying it has improved compared with 70pc of both managers and leaders.

And again, when it comes to giving family more time, those in more senior roles (73pc) who live with their immediate family agree with this statement vs. half of those in more junior roles who are perhaps more separated from family members.

It is evident that the majority miss their work colleagues and the office atmosphere and culture with over 80pc of all levels agreeing with these statements.  Younger, junior members of the workforce feel the most disconnected (44pc), feel the most isolated (45pc) and are the most inclined to struggle with self-motivation (51pc).

“The findings from this survey demonstrate an active and resilient industry, with a continued focus on the future and our role in society,” said Stoney. “IAPI are busy forming plans for 2021 which we predict may continue to provide challenges to agencies and their clients.

“The focus will be on continuing to provide advice, support and inspiration for members during an inevitably tough year. However, we will also introduce new initiatives that continue our work on diversity and inclusion and help to provide professional, accredited education for members.”

By John Kennedy (john.kennedy3@boi.com)

Published: 1 December, 2020

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