Expert: Sean Trapani - 12/18/2007

Question
Hi. I was wondering if you could tell me a little bit about the stability of the advertising industry? I mean, is it better to work for a advertising agency or in the marketing department of a large company? It seems to me that at some point advertising agencies would be phased out since most companies have in-house marketing departments. Thanks

Answer
Hi, Danielle.

It's true that there are MORE jobs for marketing communication people on the client side, but I can't say if it's "better" to work for one or the other.

By "better" I'm thinking you mean safer, with more job stability.

Unfortunately, this is not a simple question to answer. Of the roughly 15,000 ad agencies in America, perhaps 5-10% or so have been around for more than 50 years (guess-timating). Another large percentage of individual ad agencies has been acquired by a larger holding companies, as was the case with my last shop being bought out by Hill Holliday, which is owned by the Interpublic Group.  

Compare this to how many client companies have been around for 50 years - companies, not brands, that is. Brands are often sold between companies, so there's no stability there.

With an ad agency, the staffing is tied into the amount of billings (aka clients). If the shop loses a big account, there may be lay offs. If a private company goes out of business - well, you know what happens next.

So, like most questions, the answer really is:  it depends.

It depends on the agency or company you're talking about. Proctor and Gamble is a safe bet for a private company. JWT (around 100 years old) is a safe bet for an ad agency.

As to your last question, 80% of all businesses in the US are considered "small" business - having less than 50 employees. So, I doubt that ad agencies are in any risk of being phased out.  Also, the sheer volume of work that it takes to justify retaining specialized employees - say, a broadcast producer - makes a full "in-house" agency unrealistic for most larger companies, as well.

I worked on both the Verizon Wireless and Wachovia accounts; and those companies had both in-house people and outside ad agencies.


Sean