Those are two of the key findings from a new ‘State of Digital’ study produced by the UK’s voice of digital and tech, BIMA.
The study looked at the experiences of digital agencies and their clients during the pandemic and found a hugely varied picture, with some businesses suffering major hardship while others are managing relatively well. Other findings emphasized the conflicted picture:
• 27% of agencies have or expect to make redundancies, yet 44% are recruiting
• 41% of agencies expect to hit their revenue targets, yet 41% also expect revenues to drop by up to 25%
• 18% anticipate a revenue drop of more than 50%
• 38% of clients have seen revenues reduced to <75%, yet 26% have seen them rise
• 49% of clients expect redundancies but there’s deep uncertainty about how many
• While impact on revenues at client organisations has been varied, 44% of clients have slashed marketing and digital budgets by more than half, yet 3 times more clients would pick an agency that could show ROI than one that was 10% cheaper.
“One factor that appears to distinguish those managing the current situation best is scale,” says Laurence Parkes, CEO of Rufus Leonard and Founder and Chair of the BIMA Digital Leaders’ Network. “Bigger organisations clearly have a greater security buffer – but this study shows small and mid-sized agencies and clients are feeling particularly exposed right now.”
The report also looked at how agencies and clients could better manage the uncertainty and insecurity together. “Communication between client and partner is more important than ever,” explained Laurence. “We’re seeing huge amounts of strategic change happening in both agencies and with clients and that means clients need fewer but better external partners to help them with fundamental business-driving activities (like performance marketing) and a few focused strategic projects.”
He explained what agencies could do to win business. “Helpful agency partners should focus on ROI rather than low prices. They should show they understand client cultural challenges and help ease them. And they should be a safe pair of hands, delivering exactly what the client needs. For clients, they should look for genuine partners, not suppliers, because they need an agency that cares about delivering results, and cares about understanding the business.”
Natalie Gross, Co-Chair of BIMA said: “This report highlights a real need on agency and client sides to forge something new, something built on genuine partnership that helps all parties deal with uncertainty and strategic change. At the same time, it shows that agencies need to manage their own cultural shift, meeting the challenge of more homeworking to ensure they can continue to enable teams to innovate and individuals to excel. At BIMA, we need to help that process by helping the industry look forward and reboot.”
As part of that support, BIMA has announced 4 Peer Network Groups for Digital Leaders, HR, New Business and Client Services/Project Management. Each new network will comprise experts in their respective fields, who will meet regularly to explore key issues, find solutions and issue advice and guidance.
“BIMA has always been a community of communities,” explained Natalie. “At a time when many of our members need fresh thinking and new ideas to help keep them afloat, our new networks are going to be an invaluable source of support.”
Victoria Brown, HR Network Lead said: There has never been a more important time to build a community of like minded professionals within HR. We have faced an unprecedented time and I personally have turned to my network more than ever for peer review and support. The BIMA HR community will provide that safe space to gain useful insight and support for one another as we look forward to a new normal within business’.
Adam Graham, MD and Founder, Gray Matters – New Business Network Lead, said: “Sales is the bloodline of any business and for those whose pipeline has taken a decimated this year, it’s what’s going to get them and our economy back on its feet. Businesses who entered 2020 with a consistent and sustainable approach to sales, fared much better, and those with a haphazard approach need to take COVID as a reminder to plan for the unexpected. The BIMA new business network will be a place for people to share learnings, inspire, motivate and mentor one another in a discipline that should be seen more as an art than a blunt instrument. We want to look at the future of new business and how we need to adapt for tomorrow, in fairly uncertain times.”