Event agency leaders remain cautiously optimistic about the short-term future as the threat of recession continues to loom large.
During our nineteen agency leaders monthly catch-up last Thursday (which took place before the sad news of the death of Her Majesty Queen Elizabeth II), we discussed concerns around rising energy rates, recession, the cost-of-living crisis, and the impact this is all having on both client’s and agency’s own decision-making. Here we share some of the key takeaways from the session…
While some agencies said they had already had one or two client events cancelled over economic concerns, and as a result were slowing down their internal recruitment drives, others were more bullish.
The consensus was, as one leader put it: “if we could get through the pandemic, we can get through anything,” with another adding that a recession will be easier to navigate than Covid, because it is something they have all experienced and survived before.
Communication is key
“We had a company meeting this week, and one of my messages was how do we prepare for a recession. You must talk to your clients because forearmed is forewarned. We are not seeing a drop off in activity now, but it’s a little bit too early to tell. A lot of our clients work on a 12-month budget, and they will be planning activity for next year, but we don’t really know what they are thinking till December, when they get their budget,” said one agency leader.
“On a personal level, we have all experienced a great high post-pandemic, and now, we are facing what could be a tough couple of years ahead and it’s hard. You don’t want your plans for growth to be disrupted, but you have to make the best of it. Our aim is to be realistic and pragmatic and look to grow our business. But we will be more careful between now and the first 6 months of next year – you don’t want to overextend yourself,” he added.
The other energy crisis
Another said: “For me the number one focus is energy. Not the energy crisis the media are talking about, but our own personal energy, as an agency and keeping that going. There is so much noise out there, that is a distraction. There are lots of big headlines about energy bills going up astronomically. We are not seeing that translating to our clients, and we are still seeing the briefs and getting the work.
“We are active listening to our clients, and active listening to our people, but not listening to the media, because I just don’t think we can make our decisions based on the media agenda. Don’t forget that bad news sells quicker, it’s click bait. No one truly knows how it’s going to play out. But admiring the problem doesn’t get you anywhere. Let’s not admire it the way the media does.”
Another agency head agreed that there is a lot of noise going on about recession in the media. “There are opportunities out there. There is enough work out there, we just have to go out and get it. We haven’t seen a slowdown yet. I am nervous about next year and we know there probably will be a recession, but I don’t really want to take part in it.”
Those agencies with clients in so-called “recession proof” industries such as technology, telecoms, drinks etc, are feeling more confident right now.
“We are being cautious, not overly cautious but cautious none the less, we have relished the return to live and had a great financial year,” said one agency leader. “We have had one or two clients that have made it abundantly clear that the larger more celebratory events won’t feature on the calendar over the next year. This is not across the board and limited to a few in our portfolio thankfully.”
Recruitment pressure eases
On a positive note, the issues around recruitment appear to be easing, with several agencies saying they had come to the end of their current recruitment cycle and filled the positions they needed to fill, so are now focused on bedding those people in.
Others still have resource issues and roles to fill, while several leaders are putting their foot on the gas when it comes to recruitment or revising their growth plans.
“We had ambitious growth plans for the next few years, which we have revisited. I am determined, and I am not prepared to give up on those hopes and dreams. I have just slimmed those dreams down a bit in the short term. We just want to look after our team, and clients, and do the best we can but have taken our foot off the gas a little,” said one agency head.