Infographics – Digital Agencies Survey 2021

The digital agencies survey addresses all the questions of interest to industry professionals and brings us interesting insights into the popular field.

Information about the agency itself

♦ Most agencies (89%) are small agencies with fewer than 15 employees. An increase of 10% from the previous survey.

♦ A 48% growth in digital agencies defining themselves as performance agencies, and a 50% growth in agencies that define themselves as web development agencies. A 25% decrease in agencies defining themselves as SEO agencies, in addition we see a 55% growth in agencies specializing in e-commerce.

♦ 27% of agencies said the biggest challenge this year was employee recruitment (a 50% increase), and 21% said the biggest challenge this year was client retention (a 40% increase from the previous survey). Only 12% said they had difficulty acquiring new clients (a 56% decrease from the previous survey) – there is an increase in difficulty recruiting new employees to the agency, an increase in difficulty retaining clients, and an increase in the lack of professional knowledge

♦ There is a 30% increase in professional training via Israeli websites, a 20% increase in training via YouTube, a 27% increase on paid course websites, and a 47% decrease in sending staff to courses due to Covid.

♦ 41% of you tried to deal with Covid by acquiring new clients,  14% did so by expanding the agency’s service offering, and 12% did so by stopping work with freelancers compared to 6% who outsourced work to freelancers to save on costs

♦ There is an increase (10%) in the work model of a single person who serves as both an account manager and a campaign manager. Here too, we think the change stems from staff reductions caused by Covid.

 

Clients
♦ 91% of clients coming to the agencies have prior digital advertising experience

♦ 87% of agencies reported that they showed flexibility in their relationships with clients during Covid.

♦ There is a 24% decrease in real estate advertising, a 20% decrease in services advertising, and a 20% decrease in advertising art/entertainment, compared to a 28% increase in advertising e-commerce, and a 59% increase in software advertising

♦ There is a 20% increase in the use of Data Studio reports and a 19% increase in the use of presentations; there is a decrease in the number of hours the agency spends on client reports, with most spending up to 5 hours a month preparing reports.

♦ 53% of agencies work with freelancers on a regular basis, no change compared to the previous survey, 19% do not work with freelancers (20% less than the previous survey) – there is no fundamental change in the way agencies work and the market remains relatively stable. The main increase is in working with freelancers for specific projects (a 12% increase)

Advertising Platforms

♦ There is a 122% increase in agencies investing more than 25% of the budget in Outbrain and Taboola; in absolute numbers the figure is still low – only 20% of agencies

♦ Investment in Google advertising remains constant, there is a decrease in budget investment in Facebook advertising

♦ There is a drop of over 40% in advertising on Amazon, Bing, Snapchat, compared to a 14% increase in advertising on LinkedIn – this connects to the improvements made to LinkedIn’s advertising platform over the last two years

Budgets
♦ 51% of agencies charge setup fees, an increase of 15% from the previous survey

♦ 74% of agencies reported that they experienced revenue growth, or that revenues remained unchanged. A figure that does not align with the decrease in budgets, decrease in employee count, and decrease in commission percentage.

♦ 49% manage a budget under 1 million NIS per year. As well as 29% with budgets between 1-5 million per year.

♦ 78% of agencies manage a budget of less than 5 million NIS per year, a 13% decrease compared to the previous survey – budgets were reduced due to Covid

♦ The vast majority of you are optimistic, 90% believe they will increase advertising budgets this year.

Summary

In summary, the digital field has seen a lot of upheavals over the past year: there is a decrease in the number of employees, a decrease in budgets, a decrease in management fee percentages, which means the market has contracted. The market is shifting to performance and e-commerce.  There is an increase in difficulty recruiting new employees to the agency, an increase in difficulty retaining clients, and an increase in the lack of professional knowledge. The vast majority did not fundamentally change their work method and did not increase the amount of work with freelancers. Most clients have previous experience in digital advertising. Compared to Facebook, which saw a decrease in budgets, Google is stable, while there is an increase on LinkedIn and Outbrain / Taboola; most importantly – the vast majority of you are optimistic, 90% believe they will increase advertising budgets this year.

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