Home News Agencies Expect a Better Performance in 2024 According to IAPI Census

Agencies Expect a Better Performance in 2024 According to IAPI Census

IAPI members are predicting an increase in profit margins and revenues this year according to the latest Census published by the industry representative group.

Looking into 2024, 90pc also said that their agency will do as well, if not better than 2023 while nearly three-quarters (72pc) believed that revenues in 2024 would increase. Just 5pc, meanwhile, see revenues actually declining.

However, the Census noted that many are concerned about the levels of increasing conservatism and caution among their client base regarding the type of content being released.  Their fear is that this will lead to reduced innovation and creativity in the sector.

According to the Census, the total workforce employed by IAPI members is on a par with last year, estimated at approximately 2,300, with the  highest  volume  of  staff  within  Client Services and Project Management. “The war on talent, caused in the main by the tech companies, seems to have eased.  Talent Churn is down YOY at only 10% vs 16% on average in 2022. Administration  and  Client  Services  departments are still seeing high churn however at 22% and 18% respectively,” it notes.

“Over a third of talent leaving the industry is reportedly taking time out or going travelling, still reflecting the lag in this natural movement due to the pandemic. Less than 10% of leavers are now going to tech companies, while movement to other creative agencies accounts for a quarter of leavers,” the Census reports.

“The industry is actively recruiting for creative and content creation skills, with 60% of respondents looking for each of these specialists as a matter of urgency or within the next year. Social media and strategic planning skills are also in high demand.  This is mirrored by the leaders, with the highest percentage of these respondents most concerned about creative thinking, with skilled client management a close second,” it adds.

The Census also points out that while wage inflation has remained on a par with last year, 2022 saw “a huge average increase of 7% which is still impacting the sector as it adjusts to this new baseline.  Rising inflation and impact on running costs are of most concern still for the sector’s leaders.”

As in previous years, the untenable costs of pitching for members has resurfaced with IAPI estimating that it costs the industry €10 million in total.  “Currently almost half of the new business in the sector comes from pitching, however, with only 3 out of 10 pitches being managed by professional pitch consultants, there is a question as to whether the majority of pitches are following the IAPI Pitch Guidelines which are adhered to by the accredited pitch consultants,” it says.

“Given the scale of this issue, IAPI are currently working with a group of senior marketers, pitch consultants and agency leaders to challenge the status quo and create a more sustainable and appropriate process for agency review and selection for the Irish market.”

Elsewhere, it is noted that IAPI members still outperform the national average in gender balance with over 40% of females on the board, compared to 35% of women on boards in the largest Irish listed companies (ISEQ20).  “The goal to reach gender equality in the boardroom looks highly feasible as we can now report a 2:1 female to male ratio in Executive Management.”

In terms of diversity, however, “the industry doesn’t perform as well,” IAPI notes. “ With 16.6% of non-nationals now employed in the sector, we fall slightly below the national average of 18.5% of non-Irish workers reported in the 2022 Irish Census, and we only employ 4% of the workforce with a disability compared to 13.5% with the Irish population.

Commenting on this year’s Census, Sean Hynes, Creative Director, Bonfire Dublin and former IAPI President 2022-23 said: “As always, this year’s IAPI census shows many fantastic perspectives. Whilst there is some talk about economic uncertainty, it is fantastic to see so many agencies defiantly optimistic about their own performance for 2024. And it’s particularly encouraging to see the growth in international business now on a solid upward trend.”

To download a full copy of IAPI’s Census 2023 click HERE

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