With several agencies in the North of England ranked high in this year’s Digital Agency Census, we’ve taken the temperature from agency leaders across the region on the business outlook for the near future.
Northern English cities such as Manchester and Leeds have long been home to thriving agency scenes. But Covid has wrought economic chaos in the north, with the regional economy harder hit than the rest of the UKaccording to University of Manchesterwhile UK government promises to increase capital investment and transport infrastructure in the region have withered on the vine.
As they face tough business conditions, how confident are agency leaders in the North about their business prospects?
roller coaster ride
Content Marketing and Digital Design Team Think designbased in Bury, Greater Manchester, has had a rollercoaster ride over the past two years, according to co-founder and creative director Paul Grogan.
“In terms of lost work, over the next six to nine months it was in the region of £60,000-70,000. We were only taking £300,000 at the time, so as you can imagine it was a bit of an ‘oh shit’ moment. The April billing was the worst of all.
“But then we got very busy. Since the end of April 2020, we have started to go all out. And we have been ever since.“
Ranked second in the UK in the Census Customer Survey, Think has since the start of the pandemic doubled its workforce and revenue while expanding its range of services and diversifying its customer list.
“We now have a department that serves eight to 10 clients on content marketing strategies, enabling businesses recovering from Covid to get to market,” Grogan says.
Ranked third in the UK by peers, based in Sheffield get up at seven made its remoteness from the capital a virtue, says founder Stephen Kenwright. He says: “We grew very quickly and I don’t think it would have been possible if we had been a London agency. »
The Yorkshire town has two universities, but relatively few agencies – a factor that has helped Rise recruit new talent even as the hiring market turned hot last year. “We were able to recruit quite a few graduates and quite a few people who would otherwise have shuttled between Sheffield and Leeds, Manchester or Nottingham. We haven’t had much competition for staff.
This does not mean that everything was rosy. Rise at Seven customers have been hit by Brexit-related export restrictions, while one customer, household goods brand Cath Kidston, went into administration in the first month of the pandemic. But like Think, Rise at Seven has benefited from the pick-up in marketing activity, and this year it’s expected to bring in £7m in revenue. The agency was founded only three years ago.
Meanwhile, in B2B land, Stein IASranked ninth for awards in the Digital Agency Census among giant names in the industry, retains its UK base in the Cheshire town of Bollington (it is part of the MSQ international network).
According to Craig Duxbury, global client director, the agency has brushed aside the woes of Covid to enjoy its best year in business. He’s seen “more trust” from new and existing customers, he says. “Specializing in something, rather than fishing the same ponds as many others, gives us a differentiated offering.”
“The digitization of brands in the B2B space has accelerated the need for [agencies].“ The lockdown meant B2B customers had to “innovate and accelerate” their digital sales infrastructure – a trend that “we liked a lot”.
Northern agencies have always had access to the domestic and international economy (many blue chip companies have offices in Manchester or Leeds). But Grogan says Think has managed to access larger national advertisers more successfully over the past three years, having started as a catering agency for startups in Bury and the Greater Manchester area.
“A lot of customers were affected, but not us – we just got back to work,” he explains. “We have become much more UK-wide and have not been affected by local economic nuances and fluctuations. We are quite well isolated.“
It’s a similar story for the Leeds-based company Travel further. Almost 70% of its customers are based outside the north, says managing director Robin Skidmore. “While broader economic factors have impacted the north, they have impacted the entire world, so I don’t see northern businesses specifically taking a hit,” Skidmore says.
“The pandemic has changed the ways of working to our advantage – we are actually able to better access customer and talent pools across the country as remote working has been normalized. We’ve had flexible working since day one, but now we can build relationships virtually while adapting to the new normal. As a company from the North, we have doubled our workforce and revenue in the past 18 months and are about to open our office in the United States soon, and I am proud that a company based in the Nord is growing faster than most businesses in the UK. .“
At Stein IAS, Duxbury notes that staff at its northern base serve customers around the world. But its clientele in the specialized engineering and manufacturing sectors, always a major employer in the northwest, has also sheltered it from local fluctuations.
“We have good customers in the manufacturing sector [and] public sectors, we will still have a rich heritage in aerospace engineering. We have long-standing customers, we just gained two new global customers.“
Grogan is candid about the prospects for outside aid for the region: “The Northern Power Station was a myth, wasn’t it? Let’s be honest. It was hyperbole. And Brexit and Covid have been brutal. We haven’t suffered,” he says, but “a lot of people I talk to in the industry know very low-key agencies. Some have completely gone to the wall.“
Instead, he sees agencies in the region as masters of their own destiny. “It’s a very, very difficult business environment. But what has impacted us the most is the cost. We are trying to raise our prices because of the level of service and the quality of work that we provide, as our overhead costs rise. We still sell a lower day rate than most downtown agencies, but those rates are still lower than they were 10 years ago. We’re not going to depreciate what we do.”
For Kenwright, the period proved that it is possible to compete with agencies in London without a capital postcode. “The fortune of an agency is more linked to the location of the staff than to the location of the clients”, he concludes. “The north is where the people are.”
Discover the best digital agencies in the UK according to their clients and competitors with our Digital Agency Census 2022.