Midlands focus: How are agencies faring in the current financial climate?

As part of a series of regional reviews, The Drum catches up with Midlands agencies from a cross-section of the marketing services industries to find out how agencies in the Midlands are faring in the current financial climate.

Focus: Agencies in the midlands discuss the current climate

Dean Lovett, CEO, McCann Central: As marketing departments contract, agencies are being hit as clients move away from managing multiple suppliers, opting instead for integrated services from one agency – often a bigger player – not at risk of folding in the current climate. There is also a growing trend for communications being taken in-house, a move recently taken by Jaguar when it moved its business to its in-house agency Spark 44. It’s the middle-sized agencies that are being hit the hardest by these trends. The bigger agencies have the scale and clients to weather with the storm, while smaller agencies have lower overheads and a more nimble approach to enable them to survive. It’s the middle-sized businesses which are faring less well as their client bases are pursued by both their bigger, and smaller, competitors.Alan Cooper, founder, Freestyle Interactive: Like anywhere else. We all have to offer great ideas, great service, and great execution to offer real value to clients. If you are good at these, location isn’t a consideration. We’re all faced with the same financial challenges irrespective of geography. We’re not seeing any peculiar patterns of local buying or clients heading to perceived cheaper locations. What we are seeing is more rigour in agency selection, longer decision making and more scrutiny – and I think this is not just a current climate phenomenon, we can expect it to become the norm for the future as clients are enjoying the benefits of sourcing well and getting agencies to work ‘even harder’.Mat O'Connor, MD, R1 Creative: We've seen a lot of new agencies come and go over the last 12 months, including ourselves. Some have stood the test and are now getting their names out. Some have become houses or factories and some have died. It's tough but for those agencies remembering to market themselves as they would their clients, they are seeing the rewards and surviving.Simon Morris, MD, Bareface Media: The last couple of years haven’t been easy, as we all know. However, agencies in the Midlands seem to have ridden out the storm surprisingly well. Many agencies have demonstrated their resilience by getting smarter with their clients’ budgets and focusing hard on returns. Increased competitiveness amongst agencies for the work on offer has meant that overall the quality of creative has benefitted. Agencies have also focused hard on tapping into the ever-increasing opportunities in the digital sector; this is a particular strength emerging in the Midlands.Karen Bernie, MD, Wyatt International: Inevitably it’s mixed, but the signs are that we’re still in challenging times with some well-known names either closing or reducing staff. I’m glad to say Wyatt’s bucking this trend. Since 2011, we’ve grown by over 60 per cent, with new business wins and excellent client retention. I think in challenging times, clients look for quality service, proven expertise and tangible results – all of which have long been Wyatt hallmarks. We’ve also added a strong social media and digital offer, and this gives clients a reassuring blend of the old and new, all delivered by an experienced team, with many long-standing members ensuring knowledge and continuity. That’s been our real strength throughout the downturn.Antony Green, MD, Connect: Overall I’d say Midlands agencies are faring well, despite the climate. 2008/09 was pretty tough for all of us as many clients slashed budgets almost overnight but, in the three years that have followed, a number of bigger Midlands agencies (Connect included) seem to have been recording pretty solid results. We’re a resilient and entrepreneurial bunch, have been good at adapting to market needs, recruiting some top talent from all over the UK and further afield, and generally providing a great service from a comparatively low cost base – in this (or any other) climate that’s a compelling proposition to a lot of clients. I’m also proud to say we came second in The Drum Design 100 performance league based on financial performance, so we’re doing something right.The Drum Midlands regional feature is sponsored by Chapter photo Chapter_logo_zps8713ca22.jpg

Get The Drum Newsletter

Build your marketing knowledge by choosing from daily news bulletins or a weekly special.