British Digital and Design Agencies in 2011: Money Shortage Results in Less Creativity?

Now that the world is facing economic headwinds as a result of the 2008 financial crisis, the design industry in the UK is experiencing very hard times. In 2011, it has changed, as many believe, for worse as compared to the situation in the field in 2010 and 2009.

Design experts state that most British agencies now tend to spend less money on qualified staff to reduce expenses, but along with saving money on creative work force they are delivering poor performance, which will eventually result in sad degradation of the once blooming industry. Why does this happen, what and who pushes design agency owners to select cheaper choices and how do employees respond to this?

The Design Industry Voices study 2011 by Fairley & Associates, Gabriele Skelton and On Pointe Marketing, puts this all into the spotlight by showing how small UK design firms are surviving today in the conditions of the slow recovery after the global severe recession.

Photo: The Design Industry Voices logo,

In the survey, conducted among 496 people (50% of them are designers, 16.4% are owners, 6.8% are on the executive team, 17.9% are director level) there are a few key points, which primarily highlight the attitudes of design agency staff (the major force behind any creative project or design), to the current state of business in the field. As it turns out, design professionals in Britain are not very optimistic about the way owners and clients are dealing with the current money shortage. The study on how it feels to work in British design and digital agencies outlines seven tendencies—we combined them into two major ones—as related to the creative output and staff—along with short explanations and quotes (read the full study for detailed information, more quotes and figures).

1.    Clients want to pay less and get more.

This intention is nothing new, but today it really comes on the top and changes the employer-employee relationship in the industry dramatically. According to the survey, “over four fifths of respondents agree that ‘clients expect more work for less money’ (84.5%) and that ‘client budgets have been reduced’ (81.5%).” How does it affect work performance? For less money they get poorer results since agencies have to hire more freelancers who are not that experienced in the agency’s specific approach and client’s projects, or put their permanent staff into stressing conditions to get more for less money, which doesn’t add to the quality either.“Demoralising. Clients want everything done at speed for no money. No time or opportunities for creative input,” says one of the respondents, designer, manager, permanent, in current role less than five years, aged between 30-39.

Sometimes, clients don’t want to pay at all for some piece of work, since the growing number of clients expect agencies to do more work for free to win pitches. Everybody is aware of the tough competition in the field and clients just want to take more advantages from it, which is quite natural. “More than two thirds agree that ‘clients expect more work in pitches for free’ (70.8%), and more than half agree that ‘pitch processes are longer’ (53.9%),” writes the study. With this, clients are not willing to take risks and choose more creative solutions and prefer staying on the safer side (53.7% of respondents say so), while innovative approaches might help companies achieve their business objectives in a faster and more effective way. “It’s increasingly being dumbed down and made more obvious and commercial as the clients are frightened to try anything new. They tend to patronise the audience and don’t assume that the consumer can pick up on edgy subtleties. It’s a common problem in ALL areas of design…” says another respondent, a designer aged between 30-39 who has been with agency less than five years.

2. Agencies employ less permanent staff and more freelances and unpaid interns.

Today, over a half (58.3%) employees at design agencies are going to change job in the coming twelve months (compare it to 55.7% in 2010 and 38.4% in 2009). And money isn’t the only reason here. Employees feel that the owners do not understand them, their needs and aspirations properly, and this perceived delivery gap is widening across all agency attributes as compared to previous years. As it turns out, the biggest gap is in the most important attributes such as ‘valuing ideas and opinions’ (85.8% expect this, the gap is -49.8%, and in 2010 it was -46.3%), ‘rewarding people for going the extra mile’ (73.4%/-58.9%, -55.6% in 2010), and ‘having a management team that demonstrates strong leadership skills’ (76.2%/-53.1, -47.8% in 2010). It means that design professionals in the UK are not getting emotional payback from their job, which heavily affects the productivity. While paying extra pounds for more work may be a problem because of tight budgets, being a good leader doesn’t require any money, does it? As we may see, the situation here has turned for worse.

…There are a lot of clients demanding that something is just done the way they want despite expert opinion to the contrary. There is a lot of discussion about fees and how much work goes into each project and this seems to be due to a lack of understanding and/or respect of the design process. It seems lost that the clients are in fact employing experts for the skills they have and subjective feelings on the value of the work can dominate the management of project and dilute the end result. Within agencies there is a challenging balance between keeping the client happy and profitable whilst producing work the agency is proud of creatively. It’s easy to lose the creative’s sense of pride when the client starts tinkering or tweaking. Also there is so much pressure to complete projects within extremely tight timeframes. This is either imposed by the client and late briefing and/or internally and with limited resource and tight scheduling. This can make it difficult to get consistent creative thinking on a client or even a project,” commented a respondent working in account management, manager, permanent, in current role for less than three years, female, aged between 30-39.

Most of the respondents believe that owners have a rosier view of agency performance than their employees, and this is very dangerous, since these differences in perception can affect the future of the agencies and the British design on the whole. What’s important is that fewer than one in five thinks that they have an appropriate workload and are supported to get over the stress at work, and only a third (36%) think that their agency performs ‘very well’ in valuing their opinions.

Freelances are less optimistic than the permanent staff and more often rate their agency’s performance lower than people who work there for years. Still, agencies tend to hire more freelance designers and interns to spend less on the creative force—it’s cheaper, but does it really help achieve better results in the long term? Usually, not when it comes to the quality, since temporary staff unlike permanent staff can’t see the whole picture as they are just ‘newcomers.’ “The traditional design agency business model is no longer appropriate for current business conditions in the UK so when clients negotiate reduced fees it has direct impact on the agency’s bottom line and they have little option but to hire for less or use freelancers. I have noticed a significant trend for new agency start ups which base their business model on venture marketing principles and a significant change in how they position their services,” shared a respondent, who works in a strategy field, owner, in current role for five years or more, female, aged between 40-49. In addition to this, the recruitment system has yet to be improved. Some respondents felt frustrated at the lack of professionalism in those who are engaged in the recruitment sector.

Agencies look towards the past in terms of employee management, and have not moved with the times. Employing junior staff and over-working them at low rates. Experience has been devalued. They certainly do not practice what they preach in building their own brands—particularly through visible leadership and engagement. But, the UK still has an amazing talent base of creative people, we just need to allow them to focus that skill into brilliant work for clients through providing the right environment in the UK. How to do it? Start listening to what we recommend our clients to do. Start bringing more professional leadership in the industry. Have some fun, but let’s help the industry mature, it’s still a noisy messy teenager at the moment,” states designer, manager, freelance, male, aged between 40-49.

The study shows that the design industry in the UK is still going down now, while the world is slowly recovering from the crisis. How to get out of this circle? The design field in the UK has everything it needs to move on and amaze clients and consumers with greater achievements, it just requires some ‘fuel.’ And if owners can’t offer money, they should be creative enough to motivate staff with something else, equally valuable to a true professional.