Advertising clients optimistic about 2019 - agency business remains a people business
In December, the Swiss Association of Advertisers (SWA) and Leading Swiss Agencies (LSA) launched the new «Industry Indicator 2019» survey. The survey asked advertisers and agency executives for their assessments of the market. More than half of the advertisers reported an increase in revenue for the past year and also expect an increase in 2019. Meanwhile, communication budgets remain stable. The key factors in selecting an agency are the qualifications and personalities of the agency team. The agency business therefore remains a people business.
Many advertising clients are likely to be satisfied with the past year. Only 12% reported a decline in their company turnover, 17% reported no change and 58% reported an increase. The outlook for 2019 is similarly positive: More than half expect an increase. At the same time, communication budgets remain at a stable level: 45% of respondents are leaving their communication budgets unchanged, 30% want to reduce their communication expenditure and 21% want to increase it. The development of media budgets is comparable. However, the survey results show that the order situation in the communications industry remains stable even in economically uncertain times, as clients are aware of the importance of their public presence.
In order to keep the survey short, no questions were asked about trends in the individual media types this year. From a similar survey of advertising companies in Germany last November, it is known, among other things, that print will remain under pressure in 2019 and that digital channels are likely to continue to grow.
Top challenge: Reaching the target groups
Reachability of target groups (50 percent), the complexity of channels (42.7 percent), digital transformation (42.7 percent), marketing automation (35.5 percent) and data protection (26.4 percent) are the most frequently mentioned topics in terms of the most important challenges. As a result, more specialist knowledge, networked thinking, flexible forms of collaboration and organization as well as skilful handling of data are required. This is the only way to develop holistic communication solutions and achieve individual, relevant and targeted consumer involvement.
Agency business is a people business
In addition to the trends, the advertising companies were asked about their agency relationships. The advertising clients responded that the main sources of information used to select an agency were recommendations, contacts with the agency management and agency websites. When it comes to the actual selection of an agency, the competencies and personality/qualifications of the employees are clearly the most important factors. The agency business is and remains a typical people business.
For long-term success in the collaboration, advertising clients expect above all a high level of commitment and efficient project management, followed by strategic thinking and a high level of creativity.
The most popular form of remuneration for communications agencies is currently the "scope of work" with a clear project definition and corresponding agency expenditure. For media agencies, the percentage fee on the media volume is still the most common fee model. In addition, agile pricing is clearly gaining in importance due to new, flexible forms of collaboration between client and agency.
164 well-known advertising clients and 43 LSA agencies took part in the annual survey. The survey was conducted between November and December 2018 and the detailed results can be obtained from the offices of both associations.
