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Financial benchmarks for B2B Marketing agencies

By Andrew Dalglish -

Every year B2B Marketing Magazine, in partnership with Circle Research, ranks the UK’s top 50 B2B marketing communications agencies based on their revenues.

As the vast majority of specialist B2B agencies participate in the League and their financial data is verified, this is a strong measure of the sector’s health.  If B2B agencies are doing well, it suggests their clients are too.

Look at the headline numbers and you’d be forgiven for thinking everything is rosy.

Average gross income is up 15%.  Employee numbers are up 16%.  1 in 10 (9%) agency leaders says the market is ‘strong’ with most of the remainder describing it as ‘good’ (49%).

But look a bit deeper and we can see that whilst far from dire, the market is certainly subdued.

Although average gross income growth of 15% in 2012 is positive, it is a slower pace of growth than in 2011 (18%) and is still nowhere near the pre-recession peak of 30% experienced in 2007.

In 2011, double the number of agency leaders (22%) described the market as ‘strong’.

And what do you think agencies said when we asked them to name their single biggest challenge?  More than one half (56%) said ‘pressure on client budgets’.  The next closest challenge, ‘measuring campaign effectiveness’, was named by just 7%.

So, looks like green shoots are emerging but someone’s applied a sprinkling of weed-killer.

Some benchmarks

Economic landscape aside, what does ‘good’ look like for an agency.  Well, here are some benchmarks you might wish to build into your strategic planning.

Financially speaking:

  • The average gross income of an agency is £3,900,615
  • The average income per employee is £84,608
  • The average net profit is 11.8%

And in relation to clients:

  • On average, 25% of gross income comes from just one client
  • The average client satisfaction score is 8.3 out of 10
  • The average Net Promoter Score (NPS) is 48.9%

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