Nearly 40% of brands likely to ditch their agency within six months, survey finds
SetUp’s Marketing Relationship Survey solicited input from both advertisers and agencies—and found that they’re often not on the same page.
AbJimroe
A new study finds that 38% of U.S. advertisers are likely to end their current ad agency relationship within the next six months. The survey cited leadership changes and a perceived lack of strategy as the cause for the imminent breakups and was conducted by SetUp, a company that matches brands with marketing agencies.
The survey results reflect a deepening of trends the company identified in its previous survey, published in spring 2021, which found that approximately 30% of clients at that time were considering firing their main advertising agency within the coming six-month period. Since then, however, the odds have risen in the survey to more than one out of three marketers.
“Generally, clients are less satisfied with their agency partners, and more particularly, their primary agency partner, than they used to be,” said Joe Koufman, founder and CEO of Atlanta-based SetUp, who added that he believes there’s a “communication gap” that is straining agency-brand partnerships.
One key factor Koufman singled out is the trend of agencies appointing junior employees who “lack strategic acumen” to high-profile accounts in an effort to boost profit margins.
“There’s a team that pitches the client ... But those aren’t the people that are spending time on the account,” Koufman said, adding that the COVID-19 pandemic and subsequent rise of remote work may have also “widened” existing communication gaps on all fronts. “The ‘talent wars’ for good quality marketing talent is real, and the agencies are definitely feeling that in a big way,” he said.
SetUp also asked clients a number of questions about their current primary agency relationships and advertising needs, and found that a number of brands are bringing marketing duties in-house—22% of client-side respondents said that they’re “actively” working to do so, versus 16% of clients who said the same in 2021. Likewise, 22% of brands in this year's survey say they have too many agency partners.
