Observatory International looks into the challenges of the current economic climate – it’s tough for brands and consumers alike, and marketing often finds itself in the firing line when costs need to be cut. 36% of marketeers surveyed for Warc’s Global Trends Report 2023 said that they planned to reduce marketing spend in 2023, despite the evidence of the long-term negative impact this would have. This reduction will have an impact on the skills and capabilities being employed, both internally and with agency partners.
According to Observatory International, client-agency relationships run the risk of becoming transactional during economic depressions. They continue, procurement departments tend to be more involved and requests focus on asset production volumes or percentage savings in the media buying. There is a commoditisation of skills. In such an atmosphere as this it becomes harder to assign value to less-tangible capabilities such as creativity and strategic thinking, and so if cost has become the objective then these become deprioritised or cut altogether.
Read more about this on their website.