Turnover in Marketing and Advertising Industry and How To Avoid It

Free vector graphics of Sleeping
It’s no secret that the advertising industry has a real problem with its talent. According to ANA and Forbes, the annual turnover rate is around 30%, the second-highest rate overall, after tourism. How do these numbers affect advertising agencies and the talent itself? What can we do as a collective, and as single agencies to improve retention? There are steps to be taken, we need to keep some distance from the groundless belief that the industry simply is destined to have a human resources issue forever. Let’s take a look at what is actually going on.

Highest Turnover Rate in Agencies

Let us begin with the basics. The staff turnover rate is the number of employees who leave a company during a given period, usually one year. A low turnover rate for employees indicates that the work force is stable and that the company offers good conditions, like healthcare benefits and perks. This is satisfactory enough that the talent decides to stay. If your agency has a high employee turnover rate, this may be indicative of an unhealthy agency culture.

Agencies have been struggling with employee retention for a while now, and the number of people leaving the marketing and advertising industry has been increasing. According to reports from the 4As and LinkedIn, the turnover rate has increased by 10% compared to related industries.

Industry-wide, digital marketing and advertising have different rates of attrition. Agency type will also play a role in the success of an agency. If the agency is part of a holding company, a startup, a boutique business, or an independent operation, the industry served will play a part in the agency’s success.

This is definitely not good for business, especially for professional service businesses. This is an industry that is service and relationship-based. If an agency has a constantly changing talent pool, it can lower the trust brands put in that agency. The quality of an agency is determined by the talent of the people who work there.

Almost half the people who left the marketing industry did so because of the lack of advancement and growth opportunities, according to MarketingDive. One issue creative professionals cited was a lack of interesting or engaging work from the agencies they worked with. Another issue was poor leadership from those in charge. One of the reasons why people leave the company or migrate to other industries is because of the salaries. There is a big gap of $45,000 between the entry-level pay and in-house tech market.

The worrying metrics offered by LinkedIn are not due to salaries. The reason talent is shifting to the technological industry is related to poor growth opportunities in other industries.

Let’s look at some of the concrete ways you can avoid turnover:

1. Provide your staff with strong managers

One thing that can make employees leave in droves is having bad managers. As the adage goes, people leave managers, not companies. A Gallup poll showed more than half of people who quit their jobs say that a poor relationship with their boss was one of the key reasons.

A strong management team can often be the difference between a motivated and productive team and one that is not.

When investing in leadership and management training, be sure to focus on programs that will help your leadership team learn how to:

  • Facilitate productive one-on-ones and build trust.
  • Provide strong career advice and help employees grow.
  • Give employees enough guidance, while also letting them learn on their own.

Additionally, it can be advantageous to cultivate and advance managers from within your company rather than hiring external personnel.

If you hire someone from outside of your company, they might bring over habits from their previous job that won’t match up with your company culture. The existence of various subcultures within a team can lead to tension and conflict among team members.

The most important thing to look for when hiring a manager is whether or not they share the same core values as you. Perhaps it’s someone you’ve worked with before. If you know someone who would be a good fit for your company, and you can trust them to represent your company well, they would be a good candidate to recommend.

2. Seek and follow through on feedback

The occasional performance review isn’t enough. Your agency needs to embrace continuous feedback.

Asking for feedback is never easy. If you’re able to get feedback from your employees and act on it in a way that is beneficial to them, it will help build trust between you and your employees.

The key is to get feedback from your employees about what it is like working for your agency and then take action. If you want to reduce turnover, you should get feedback and then act on it.

To get feedback about your agency, ask people you trust what they like and don’t like about working there. Conduct a survey asking pointed questions, such as, “How would you rate your happiness working here?” or “Do you feel supported by your managers?”

You can’t always address everything, and that’s OK. Focus your efforts on fixing the problems that will have the most impact.

3. Carefully evaluate your team members

Even though you might not want to lose more people if you’ve recently had a lot of turnover, you might find value in evaluating the people in your company to gauge if they’re a good fit for your agency or not.

Is there someone on your team who is responsible for some of this turnover? Is it possible for a leader to lack the proper values or experience? Is there someone who is always negative? Are you having difficulties working with someone who does not share your team’s values?

A strong set of core values makes it easier to weed out bad fits.

Come up with a list of values that fit well at your agency. This list can serve as your hiring and career development compass. What do you love about working with them?

4. Host frequent team-building activities

When you lead team-building activities, you help your agency employees learn about each other’s strengths and weaknesses. This helps your employees to not only get to know each other better, but also to figure out how they work best together.

You can build your team by celebrating employee successes and by setting up workshops with business or communications trainers.

doing things that might not seem very important can make your staff feel good about being part of the team.

This trust will allow your team to work together to solve problems as they arise, without you needing to be present.

5. Encourage professional development

If you want to keep your employees happy, give them opportunities for career development and advancement. When your agency supports your employees’ professional growth, they will thrive.

This is a good idea for small agencies that may not have the budget to hire a training company or invest in an intricate onboarding process, but still need to improve their team’s skills.

These career development ideas are typically low cost and highly effective:

  • Pay for your employees’ books to encourage them to read and build their learning on their own. Set up a book club for your employees to discuss what they’ve read. It will help them develop a shared language and bond on a deeper level while being relatively low cost.
  • Get a group of people together for mentoring. Another low-cost, low-effort way to foster professional development is to pair people up in the company. For example, a greener person who needs to build certain skills can be paired with someone else for a shared learning experience that’s not managerial.
  • Bring in a consultant with a special skill to teach your team. While this option might be more expensive, hiring an outside source that doesn’t take time from your leadership can be valuable in developing your team. It might take time to work up to this option, but once you’re able to invest in an outside consultant, there is a lot of insight your agency can gain.

6. Promote a healthy work-life balance and culture

It can be tricky to strike a work-life balance in your agency, since what that balance looks like varies from person to person.

identify what the goals are for each individual on the team and have agency leaders help them to achieve those goals. There’s really no one-size-fits-all approach here.

Not everyone may find it feasible to log on at 9 a.m. and off at 5 p.m. No matter what your employees say they need to feel balanced, it is important to listen and stay up to date with their needs. Your employees will feel best when they’re able to do things at work and at home that are fulfilling to them.

How Much is Turnover Representing Your Agency?

In the past, skilled workers would spend their entire careers working for a single company. According to the Bureau of Labor Statistics, the average amount of time a worker stays in a job between 25 and 34 years is 3.2 years. . Marketing specialists have one of the highest turnover rates, at %19.8. This is even shorter in the marketing industry.

It generally takes new employees around three months to start performing at their full potential. Including the time it takes to sort out legal bureaucracy and hiring expenses, you want that person to keep working for you. A survey released by the Center for American Progress estimates that the cost of replacing an employee is between 10% and 30% of their annual salary. A low retention rate has a negative impact on the work environment and productivity, as well as the company’s overall financial performance.

To calculate the cost of employee turnover, add the cost of covering the vacant position to the cost of filling the position. To calculate your annual employee turnover rate, you need to take into account the onboarding and orientation costs, the productivity ramp-up cost, and the number of employees lost in that position in a given year, and multiply all of those factors by 12. You need specific data points in order to correctly estimate how much turnover is affecting your business’ bottom line.

  • Benchmark Employee Cost – The total departed employee’s compensation.
  • Vacant Position Coverage Cost – The number of days the position remains empty multiplied by the daily rate provided in your benchmark costs.
  • Cost to Fill the Vacant Position refers to the HR employee’s salary, advertising costs, assessments, testing, and the cost of all time spent by employees involved in the interviewing process.
  • Onboarding & Orientation Costs.
  • Productivity Ramp-up Cost, the cost associated with a new employee learning the ropes.

An example of this would be a company with 200 employees and a turnover rate of 19 percent. The average employee salary is $50,000, meaning the company’s turnover cost would be approximately $638,324 annually.

There are a lot of job opportunities for people who are creative or work in marketing, because the way work is done is changing and new opportunities are created all the time. Freelancing, tech companies, in-house brand market, consultancies. More needs to be done to keep the best talent engaged from the beginning.

How to Reduce Ad Agencies‘ Turnover

To lower turnover rates, an effective hiring program must first be in place. This program should include a targeted recruiting process with measurable goals and a system to track progress.

It is important to have a strong onboarding process for new employees, among other important tasks. We encourage a data driven state of mind. To know who you should hire, you need to first understand how your business is performing.

This means that you should have reports on key performance indicators, data about profitability, and what type of services to develop.


Your sales have stagnated or decreased, and you cannot figure out why. Discover what is holding you back from achieving predictable sales growth in your business.

If you want to grow your business, you need a proven plan and framework. That is what you get with the 2X Your Sales Discovery Session.

Want to learn about a formula for Predictable Growth that will put your business on a 90-day path to 2X Your Sales?

Join our 90-minute one-on-one virtual workshop.