Will Green
Oct 1, 2023

Ebiquity warns of 'risk averse' ad market as clients cut budgets

Commentators point to 'soft' pitch market, but it is expected to pick up in 2024.

Risk averse: clients are
Risk averse: clients are "planning for the short term" (Getty Images)

Media consultancy Ebiquity has warned of a “cautious” global advertising market with clients deferring work and cutting budgets.

In the company’s results for the six months ending 30 June, Ebiquity said the market was “risk averse with many global brand owners planning for the short term rather than the long term”.

The consultancy said inflation had started to moderate but there remained upward pressure on staffing costs.

“We are seeing some delays to client commitments and deferred work,” Ebiquity said. “In recent weeks, we have started to see business challenges impact some major clients leading to increased pressure on projects and fees, and some budget cuts.”

The company’s comments come against the backdrop of a reduction in spend among US tech clients that has hit profits at advertising holding companies, including WPPS4 CapitalIPG and, most recently, The Mission Group.

Ebiquity reported revenues of £40.6m in the first half of 2023, up 11% on £36.7m in the same period of 2022. Adjusted profit before tax rose 8% from £4.7m to £5m over the same period.

Nick Waters, chief executive of Ebiquity, said: “While we are seeing some major customers cutting budgets as a result of prevailing market conditions and trends, Ebiquity continues to trade broadly in line with expectations. Looking further ahead, as the market leader we remain well positioned to help our clients and see further opportunities for revenue growth and margin enhancement.”

Stockbroker Panmure Gordon, commenting on Ebiquity’s results, said: "Macro is undoubtedly weak and the warnings from both agencies and media owners reflect the environment.

"Ebiquity is seeing some modest budget adjustments from a few larger clients and also some deferrals, but the business does continue to trade robustly due to its position as a high-value-add adviser on how to improve efficiency and drive marketing returns.

"The local agency selection (pitch) market is soft after a strong 2021 and 2022 but is anticipated to pick up in 2024.”

Source:
Campaign UK
Tags

Related Articles

Just Published

1 hour ago

Campaign Global Agency of the Year Awards 2023: ...

New Zealand's Special repeats as Creative Agency of the Year while The Weber Shandwick Collective was named Asia Pacific Network of the Year.

2 hours ago

Agency Report Cards 2023: We grade 31 APAC networks

Campaign Asia-Pacific presents its 21st annual evaluation of APAC agency networks based on their 2023 business performance, innovation, creative output, awards, action on DEI and sustainability, and leadership.

3 hours ago

Agency Report Card 2023: Publicis Media

Starcom shone brightly for Publicis Media agency in 2023, and the Groupe decision to award staff bonuses was well received.

7 hours ago

Newsflash: Journalism matters to young audiences

Research from Newsworks shows that, contrary to some expectations, news content readership is rising, particularly for people in their late teens and twenties. And that was before Rishi Sunak called a snap election.