Brands Aren’t Spending on Advertising Like They Used To. How Agencies Can Use Job & Wage Data to Stay Competitive
“Tech clients are breaking up with ad agencies.”
This headline from a recent Marketing Brew article tees up the key issue many advertising agencies are now facing: dispensability. Many companies, amid high inflation and dwindling VC funding, can’t rationalize paying for “premiere offerings,” like ad agencies.
To be clear, this ad agency crisis isn’t particularly new. There’s been a steady drumbeat of articles highlighting it since 2020 (and before then). But the emergence of AI solutions makes 2024 an important “comeback year” for ad agencies. To survive, they must optimize their personnel spend.
Here, we discuss three ways real-time job market data can help you, advertising agency leaders, do just that.
1. Hire Based on Live Data – Not Headlines
Don’t let headlines dictate your hiring strategy.
Yes, it’s important to consider what industry experts are saying. But you also need data to accurately assess the industry. This is especially crucial when you consider that publications may use one headline-worthy stat – e.g., “ad business cuts 2,500 jobs” – to substantiate a larger claim about agency performance nationwide.
That doesn’t mean the stat, or even the opinion that follows it, is incorrect. It just means that there’s room for additional context. Data gives you that context.
For example, let’s say you run a boutique advertising agency. You’ve gotten a recent influx of clients, but you’re worried about over-hiring for the current moment. So you use real-time job market data (via Job Market Pulse) to check out the agency landscape. You track the number of listings that similar ad agencies have shared in the past year. You notice the number has generally increased for one agency, declined for another, and remained relatively consistent for one more. This variance may help you decide that, for now, you’ll leverage a network of freelancers to manage the load.
The real-time nature of the jobs data is worth noting here. It puts you in a proactive position. You’re not reacting to industry analysts who share insights from a three-month-old report; you’re making use of up-to-date data on an ongoing basis.
2. Identify Hiring Trends by Tracking Junior- vs. Senior-Level Openings
When businesses want to minimize labor costs, there are often two ways to go about it, aside from layoffs:
- Don’t hire new employees when there’s more client work; add it to experienced employees’ plates.
- Replace departed senior-level talent with entry-level talent you can train up.
Each strategy has its own risks. But to trim budgets, agencies must consider these personnel decisions.
These strategies are also necessary for recruiting, though. Let’s say other agencies are burning out, and losing, experienced employees. This could give you an opportunity to scoop up this recently departed talent.
If you want to see how other agencies manage their personnel budgets, check which positions they’ve hired for recently – with Job Market Pulse. Here, you might filter roles by title (“Account Director”) and employer (the agencies you compete with) to see a list of relevant listings.
Across agency Account Director positions, there’s a 40 percent gap between the 15th-highest salary and the highest salary.
After reviewing these jobs, you may discover that various agencies aren’t hiring for this position – and are instead hiring junior talent. This could mean they’re (A) growing or (B) effectively replacing longer-tenured talent with entry-level candidates.
Now let’s say you want to adopt the same strategy: hiring junior talent. There’s now more competition for these roles. So how do you stand out? You might point to your generous benefits package that features a 401(k) match and unlimited PTO.
But there’s another strategy that can help you attract top talent and cut costs: offer hybrid or WFH opportunities.
Full-time in-office workers view hybrid accommodations as equal to an eight percent pay increase. Nearly one-third of hybrid workers would also take a pay cut to be fully remote. The average pay cut they’d accept? Eighteen percent.
3. Find the Right Talent (at the Right Price) by Analyzing Wage Data from Talent Competitors
It’s easy to look at a phrase like “optimize personnel spend” and read that as: trim the budget. But that’s not always the intent. Sometimes it means recruiting the most valuable hire possible. You can accomplish this when you…
- Avoid bidding against yourself.
- Cast a wide enough net.
How do you avoid bidding against yourself? The same way you cast a wide enough net: research your talent competition. Here’s how that might look in practice.
Let’s say you’re planning to hire a junior copywriter. For you, it’s an entry-level position that requires no previous experience. But before posting the job or establishing a salary band, you’ll want to see what wages your talent competition offers.
Remember, your talent competitors aren’t just other ad agencies; they’re also businesses that may hire copywriters or otherwise attract entry-level talent in your area (and beyond).
The best way to check talent competitor wages: use our Wage Benchmarking Tool. A simple keyword search for “junior copywriter” is a great place to start. This will show you salaries from every junior copywriter listing (that lists compensation) in our database. After this, you can widen your search to include similar roles, specific employers, and even certain keywords, like “entry level.”
This research will help you settle on a salary band that’s both competitive for your area and fair for your agency.
Maximize Your Personnel Spend with Real-Time Job Market Data
Today, the best advertising agency is a lean one. Every personnel decision is looked at through a microscope. But without adequate research, those decisions could needlessly cost you.
Wage Benchmarking and Job Market Pulse can help. In a matter of minutes, you can see data that comes from 140+ million active and historical job listings. That’s a lot more informative than a headline or two.
Want to see this jobs and wage data in action? Book a demo!