Agency survey 08: B2B agencies maintain growth...for now
Business-to-business marketing communications agencies continued to grow in 2007 with the top 40 consultancies reporting an average increase of just under 21 per cent in growth profit, and 22 per cent in staff. B2B Marketing's annual Agency Survey shows the agency community is experiencing its fourth consecutive year of growth, suggesting the sector remains buoyant. However, given that these figures represent the previous financial year, (concluding in either April or December), next year's results may look different as the credit crunch starts to bite.
The best evidence for this comes in the response to the survey question "How would you describe the state of the market?". This question was designed to reflect current perceptions of market strength, rather than measure financial performance from last year and the results arguably function better as a barometer. Respondents were split three ways between describing the market as buoyant', static' and challenging'. This is not surprising, although it represents a significant shift from last year's survey, when the overwhelming majority (75 per cent) described the market as buoyant' and only 15 per cent as challenging'.
Having said that, the 2008 survey was conducted against a backdrop of bank collapses on Wall Street and mergers in the UK, which would certainly undermine optimism surrounding business prospects. At the same time, there is little evidence agencies are experiencing anything more than a general softening of the market, and it is too soon to say what impact a recession would have on this sector.