From making it through the Great Resignation to navigating layoffs and leaner teams, the past year has forced agencies to show resilience, take risks and adapt to not only the challenges facing their industry but the challenges facing their clients’ industries as well.
Now, these agencies are gearing up for another year full of change and new trends, which may come with tighter budgets.
In 2023, agencies will be adjusting to cultural shifts in the workplace, introducing new tech services to meet client demands, adopting new tech (while mindful of talks around AI replacing some creative jobs) and refocusing on the omnipresent need for reliable business data.
Magna Global predicts just 4.8% growth in US-based advertising, down from the 10% growth they predicted for 2022. And while this is a relatively large shift in the course of a year, Magna shares the drop in 2023 could be largely due to the lack of political campaign spending or cyclical events like the Olympics, and not a major change in industry trends.
While these Magna predictions show some slowdown in the industry, the agencies themselves are taking a slow and steady approach to 2023. In a survey conducted by CallRail, three-quarters of executives at media agencies ranging in all sizes said overall advertiser spending will remain steady in 2023 — only 20% of respondents predicted cutbacks.
Ever since the pandemic caused a massive shift to remote work, the once distinct agency culture began to change. Now three years later, agency workplaces continue to operate with a mix of remote and hybrid environments — a big transition from the largely in-person, collaborative environments of years past.
And this trend is likely to stick around. Due to rising living costs and economic uncertainty impacting childcare, eldercare and transportation, there will likely be a continued demand to embrace remote and hybrid cultures. Forrester predicts that the physical, traditional agency culture will be replaced by a virtual one in 2023 and that this more permanent change will diminish in-person collaboration.
Despite what some see as limiting changes, this cultural reset also provides an opportunity for agencies to break some of the more negative traditions of agency culture.
When people think of a traditional agency, they often think of long hours, overwork and burnout. But now, agencies have the chance to reform their workplace with remote and hybrid work and new tech solutions offering automation and efficiency — an opportunity to work smarter, not harder.
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Forrester predicts that the software products and services offered by agencies will grow enormously in 2023. Many agencies will begin to reinvent themselves with new tech-focused services like Web3 and metaverse consulting services and more agencies will develop partnerships with online platforms like Meta, Roblox and Fortnite.
This change aligns with client demands for more tech, as Forrester shares that nearly 70% of CMOs at consumer-facing brands are seeking strategy in this area for the next year.
For years now, artificial intelligence has been a topic on the minds of many professionals, but the recent release of OpenAI’s ChatGPT and AI-generated art tools like OpenAI DALL-E have started a more serious conversation about automating creative work and what that might mean for creative professionals in the agency industry.
As more businesses embrace AI tools, there are discussions about the fear that AI will eventually replace creative jobs like writers, graphic designers, videographers and more. But as much as AI can do for agencies, there is still a tremendous need for marketing experts who contribute creative, strategic and empathic qualities that a machine cannot replicate.
And while there are still some unknowns for how AI will impact agency life beyond 2023, the advancements of these tools will help agencies personalize messaging, interpret data and automate tasks — particularly helpful for years when budgets are tight and hiring new employees to keep up with client demands might not be possible.
According to the CallRail survey shared earlier, 85% of agencies believe proving ROI to clients will be the key to growth in 2023, so investing in new tools and staying on top of trends and technologies are top priorities for agency leaders in the year to come. This is where software specialized for client work gives a competitive edge.
Digital transformation has changed how agencies make decisions and deliver client work. It’s no longer an option to just rely on a gut feeling or hunch. Agencies need new technologies to make quick and accurate business decisions, to meet the demands for increased speed and to better serve their clients. Digital tools built with agencies in mind — like a client portal — can help your team overcome these increasing demands while supporting stronger, more profitable client-agency relationships.
Business leaders will need to overcome any fears of adopting new technologies to remain relevant in this increasingly competitive industry and the agencies that find the most success with new tech rely on platforms built specifically for their business.
A client work management system like Accelo can collect and centralize all your business data in one platform for maximum visibility and efficiency. With the ability to track and report on your entire client journey, as well as important internal data like employee time and utilization, your business will have the insights needed to make more informed decisions with confidence.
While 2023 will likely bring a unique set of challenges — an uncertain economy, shifting client demands and navigating new tech — the agencies that stay focused on their mission, show courage and test new ideas and digitally transform their business will be able to weather the storm.
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