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Market Update: Key Insights from CEO Conversations

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Over the past few weeks, we’ve hosted virtual roundtables for agency CEOs to discuss the start of the year.

A few key themes have emerged:

1. Heightened Demand for Senior Counsel

The turbulence generated by the federal government has clients increasingly seeking senior-level counsel, reinforcing the critical role agencies play in guiding clients through uncertainty. Many leaders report reallocating budgets from other planned initiatives to meet this demand.

Recommended Action: Review senior level billing rates and utilization targets to ensure your policies are in line with the demand and continue to emphasize the strategic value of the programming that may have been put on the backburner.

2. Pipeline Activity & Decision-Making Trends

The good news: the pipeline remains active; however, some CEOs report that decision-making, which accelerated in Q4, is now slowing.

Recommended Action: Given that business won in Q1 sets the financials for the year, ensure teams are maintaining momentum with prospects, reinforcing value and the cost of inaction, and helping clients navigate internal decision-making hurdles.

3. Generative AI: No Budget Cuts, More Value

Encouragingly, no leaders report budget cuts due to the adoption of generative AI. While it’s still early in the technology’s implementation, firms are wisely positioning AI as a tool to enhance value rather than replace services.

Recommended Action: Equip your teams to message AI’s role in delivering greater efficiency and effectiveness, not cost-savings.

4. Talent & DEI: Staying the Course

Beyond business demands, this remains an emotionally complex time for agency talent. Some leaders report maintaining their commitment to diversity, equity, and inclusion (DEI) initiatives, while others have had to adjust language to protect government contracts.

Recommended Action: Reinforce internal DEI commitments and explore ways to demonstrate these values. Agencies that remain committed to DEI values should be prepared to show “receipts” or actions in the months ahead.

5. Return to Office (RTO): Still Evolving

No CEO discussion would be complete without addressing return-to-office (RTO) strategies. Some firms are now hiring emerging talent only in markets where they have offices to ensure strong learning opportunities. Others report that a distributed, hybrid workforce continues to work well.

Recommended Action: Evaluate hiring and workplace strategies to ensure they align with both talent development goals and business needs. Clearly communicate expectations.

The resilience, adaptability and unique capabilities of PR agencies continue to be a source of strength. Let’s keep the conversation going—what trends are you seeing in your business?