Pricing advertising services in a recession

Digital creativity blog by Flow Bohl, 8.3.2010

Since the recent economic downturn many businesses were re-thinking their investments, especially in marketing and advertising. Staff has been laid off, designers and art workers specialized in print in particular. Yet the online-advertising industry proved surprisingly robust against the market's turmoil, some digital agencies even grew during that period, especially through underpricing some established major players. However, competing on price very often damages the perceived and actual quality agencies deliver.

For designers it means that their livelihood is seen by advertisers and increasingly from agencies as unnecessary expense. The problem isn't only price-consciousness but also a strategic drift towards different channels that will alter future demand for talent. With focus on social media and other cheap and effective marketing communication channels not only designers but copywriters, media planners amongst many others face an uncertain future. Hence many designers struck out for greener pastures as freelancers.

No one saves themselves rich. Great creativity and imaginative thinking can lift the fortunes of a brand. Will some advertisers continue to treat their agencies as mere commodity suppliers, chosen on the basis of price alone, they won't enjoy the success they do.

'I struggle with profit vs art decisions daily. I have two small children and the downturn economy is, not only, effecting the agency, but also, me personally. But, it is because of my two small children that I make many of the decisions that I do. If cutting corners and forgetting who we are means that we'll be cutting our own throats in this competitive marketplace, then bring on the Katana - I'm going down fighting.' These words are from Leo Burnett in 1967:

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