‘A vicious cycle of burnout’: Constant pitching blamed as media agency churn hits 34.5%

The chairman of the Media Federation of Australia Peter Horgan has blamed the huge rise in pitches in the last year for media agency staff churn rate rapidly approaching the 35% mark.

Horgan: balmedo.

Horgan: blamed the surge in industry churn on a ‘merry go round’ of new pitches.

New data published by the media industry body shows staff turnover across the industry is now at 34.5%. The MFA says “regrettable loss” is at 31% and “non-regrettable loss” at 3.5%.

In a statement, MFA chair and CEO of OMD Peter Horgan said: “While our industry is managing a period of unprecedented change, the increase in the number of good people leaving permanently is a cause for concern. In this environment, you adapt or perish, but non stop pitching as a perceived solution to trust issues exacerbates the problem.

“A merry go round of pitch promises and the extra workload, and the resource allocation away from solving client problems is a vicious cycle of burnout and under delivery. It’s an industry wide problem and one that we need to address collectively.”

Screen Shot 2016-06-06 at 10.36.20 amLast year saw a spate of global media pitches – dubbed “mediapalooza” – with a number of local agencies forced to step up and defend global accounts locally.

Regrettable loss, defined as staff moving to a competitor media agency, rose from 26.8% last year to 31% this year.

Non-regrettable loss, people choosing to leave the industry altogether, fell marginally from 4.9% to 3.5%.

Industry churn in media agencies is closely watched with many marketers complaining about the high turnover of often young staff working on their accounts.

The MFA census study also noted that media agencies are continuing to transform, offering clients a growing portfolio of services, with 35% of MFA members servicing non-traditional areas such as digital, creative services and analytics. However, it noted that digital is now becoming the norm and rather than a separate, specialised area.

MFA logo expanded

The census also highlighted continued positive growth in the number of women in management roles, up to 42% in the media agency industry.

Screen Shot 2016-06-06 at 10.35.16 amIt also said the media agency industry population grew 5.8%, which represents an 86% increase over the last five years. Growth is across both traditional (up 4.9%) and non-traditional (up 7.4%) sectors.

“It’s pleasing to report the continued growth of our industry population, and to see it continue to evolve and diversify,” says Sophie Madden, CEO of the MFA. “Today’s media agency industry is about so much more than just buying and planning. However the census also highlights the challenge our members face in people management; recruiting, training and retaining talent to keep pace with this growth.”

The findings come on the same day that PwC published a report, which highlighted the lack of diversity across the broader media industry. 

Correction: A previous version of this story incorrectly put the churn rate at 40.4% the correct rate is 34.5%.


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