Major Downsizing: approximately 3% of Lays' Employees (around 37 individuals) Let Go

Major Downsizing: approximately 3% of Lays' Employees (around 37 individuals) Let Go

Digital agencies feeling the squeeze 📉

Huge, a leading digital agency, is trimming its workforce by about 3% – that's around 36 employees – due to a changing market landscape and clients tightening their purse strings, as confirmed by CEO Mat Baxter to Adweek.

Under the belt hit by significant revenue drops in the second half of the year, Huge, with approximately 1,200 staffers across 12 global markets, is facing the reality of clients canceling, postponing, or reducing their spend on projects.

Baxter points a finger at several sectors where Huge has observed clients scaling back their spend, including P&G's SK-II and Brooks Running. The agency will continue to work with SK-II, but the client has reduced its expenditure with Huge, and Brooks Running has decided to bring its work in-house.

What's behind the trimming? 🤔

It's not just Huge feeling the pinch: current market trends show that many digital agencies and marketers are trimming ad spend or shifting work in-house due to a mix of economic wariness, evolving marketing priorities, and the desire for greater efficiency and control.

More than half (54%) of global marketers plan to slice their advertising budgets by 2025, with European marketers even more keen (60%) on cost-cutting in the face of economic uncertainties and market changes[1][5]. Brands are favoring digital channels seen as cost-effective and performance-driven, such as connected TV, social media, and search advertising, but sometimes this focus on measurability means underinvesting in traditional channels that deliver strong returns on investment, like radio[1][5].

Marketers also see the growing role of AI and personalization as crucial for 2025, using AI-driven personalization and optimization to stretch leaner budgets.

Bringing work in-house is another trend, as brands aim for tighter control over brand messaging, faster turnaround times, cost savings, and better integration between marketing functions and brand strategy. This becomes especially important under pressure to reduce external agency fees[1][5].

The future of digital agencies 🔮

As external budgets shrink, digital agencies must adapt or perish. Brands like SK-II and Brooks Running are setting the example by developing internal capabilities for digital marketing and content. This shift is more than simply a cost-saving measure; it speaks to a desire for agility in a rapidly-changing digital environment and the ability to respond quickly to consumer behavior shifts.

With technology and tools readily available to aid in-house teams, expect the digital agency landscape to evolve as companies continue to assess where their marketing dollars can have the most significant impact in 2025 and beyond[1][5].

[1] "State of Marketing: Inside the World's Top Marketing Organizations," Salesforce, 2023[5] "Advertising Budgets: Global Trends, Challenges, and Opportunities," Euromonitor International, 2023

1. The tightening of budgets in the finance sector, coupled with changing business priorities and a preference for in-house work, is causing digital agencies like Huge to scale back their workforce.
2. As economic uncertainties persist and digital marketing channels become more prevalent, the finance industry is pushing digital agencies to become more efficient and adaptable, with more than half of global marketers planning to reduce advertising spend by 2025.

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