How agencies can business plan for 2025 in turbulent economic and political times

We ask agency leaders how they are approaching the essential task of business planning and financial forecasting and what specific external factors they are taking into account.

Forecasts driven by foresight

Annabel Engels, managing director, Mother Design: “When it comes to business planning and financial forecasting, we approach it just like we approach our work with brands – by embracing both strategy and creativity. We look ahead, asking: What’s changing in culture? What challenges are our clients facing? Are there advancements in AI or shifts in consumer expectations to consider? How is the role of design evolving? These factors shape the demand for what we offer, so our planning is driven by foresight and adaptability in a world of constant change. It’s less about predicting everything and more about staying nimble, ready to pivot without losing sight of our purpose. None of our planning happens in isolation. I involve key leaders across the agency – our head of strategy, client services team and creative leads – because fresh ideas often come from unexpected places and everyone has a role in shaping the vision. When resourcing for the year ahead, we balance capacity and creativity. You can’t stretch creative people too thin or you lose the magic. Ultimately, my focus is always on how we create more value for our clients by helping them connect with people in meaningful ways.”

Darryl Newton, managing director, Wooshii: “Our general approach is a bottom-up budget to deliver a top-down strategic vision and shape. Staying close to our existing customers and using our AI tech to provide them with a fast turnaround strategy, creative ideation and pricing gives us a good steer on 75% of our base business from which we can plan resourcing, utilization and overhead. For new business, we have strong leading indicators on pipeline requirements and carefully track ROI through internal tools and agency partners. For our AI tech solutions (this is far harder to plan for), sales cycles are longer, the tech is moving fast and customers need educating. Here, we plan risks and mitigations for peaks and troughs in sales as this area is highly cash-generative or depletive. We’re therefore prudent to allow our mature business to pick up the strain to support the exciting growth in our AI-led solutions. All business stakeholders take responsibility for building the year’s plan, giving them ownership of delivery while simultaneously being briefed to achieve the strategic value vision from the exec team to create the correct business shape and capacity to capitalize on potential growth areas.”

Marc Webbon, co-founder, Wonderhatch: “Investing in the business is our main starting point for forecasting. Ultimately, our investments inform our budgets, our growth projections and how we manage resources. We’re fortunate to have achieved roughly 30% growth year on year for the last few years, and our investment plans and pipelines are constantly discussed between our sales, production and creative heads. You can have the best planning in the world, but when clients’ budgets and political pressures are uncertain, projected income can take a hit. Keep an eye on your pipeline to spread your bets and risk. Never rely on one or two hero accounts. Getting the right blend of accounts and revenue opportunities is key. Ambitious growth targets are important, but they aren’t and don’t need to be set in stone. The ability to review forecasts, to be agile in the face of unforeseen challenges, creates the room for stability and ongoing success.”

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Louisa O’Connor, managing director, Seen Presents: “It’s almost impossible to plan ahead with how unpredictable client’s budgets are. Projects are being pulled last minute or scopes reduced, so what you think will happen often doesn’t. I am constantly re-forecasting and moving money around. We plan based on what we know using typical historical data with about a 30% uplift for new business opportunities, allowing us to fill canceled projects as well as fill what we call our ‘leaky bucket.’ My plan for 2025 is to maintain versus grow, knowing that things are still unpredictable. The focus is keeping the current team full-time and busy – if we see bursts, we’ll flex the team momentarily until I know it will be a consistent upward curve.”

Marcus Orme, CEO, Medialab: “Our approach to business planning and financial forecasting is centered on agility, transparency and data-driven decision-making and involves input from client team leaders and senior business leaders. We set annual growth and new business targets and have always resourced ahead of that expected growth, maintaining a strong talent pipeline through initiatives such as our boot camp program. This does give us an above-average people cost-to-income ratio, but it means we can always service our clients effectively. Our clients expect certainty from us, not only in how we plan and buy their media but also in how we anticipate and stay ahead of trends. External factors such as the economic environment, consumer spending attitudes and geopolitical developments are consistently monitored through bespoke surveys and market analysis. This ensures we stay aligned with both global and industry-specific shifts, helping our clients de-risk their marketing investments and make informed decisions. Additionally, our deep understanding of client’s business cycles, supported by insights from Apollo, our marketing intelligence platform, allows us to accurately model and predict client spend and new business potential. As a business, we use this insight to conduct monthly re-forecasting, which allows us to stay nimble and responsive to market fluctuations and wider macro factors.”

Get it done early

Rob Conibear, managing director, Jung von Matt London: “The world seems a volatile place at the moment. Politically. Economically. Ecologically. Everything really. So we’re speaking to existing clients early about 2025, to get a handle on what feels certain. Keeping a lean team and complementing it with specialist talent is our strategy at present. We’re still small, and for now, that means we can compete on some smaller to mid-sized projects, but we anticipate bringing in bespoke expertise for some of those, either from within our wider network of offices (especially for global briefs) or from freelance talent in the UK. With so much variation in project types, we don’t know exactly who we will need until we work through some strategy. I don’t anticipate a significant drop in spend in 2025, but I do anticipate more being asked for within those same budgets and a different range of partners delivering the work as a result.”

Alicia Iveson, co-founder & CEO, Hijnks: “It goes without saying that annual business planning and financial forecasting has become increasingly challenging post-pandemic and amid ongoing global unrest. Gone are the days of predictable retainers teamed with regimented marketing calendars as the uncertainty and perhaps nervousness perpetuate the industry. We are fortunate here at Hijinks to be nimble enough to navigate the lack of predictability, but as we’re still a relatively new agency, we don’t have a huge amount of historical data to inform how we’ll move forward. That said, at every level in the business, we’re all committed to being across the numbers in detail and we have weekly all-agency sessions to determine what the upcoming months may look like. This, teamed with active and ongoing conversations with our senior clients, sets us up for the best chance of success in uncertain times.”

Paul Houlding, founder & CEO, Isobel: “The only way to forecast is with the absolute understanding that whatever we forecast will be wrong. Yes, it would be lovely to have guaranteed numbers but that hasn’t ever, nor ever will, happen. So, we are really looking for a direction of travel, where early budget conversations with clients, honesty about what we really think will happen in the business, topped up with a gut feeling about new business are invaluable. When we have had those discussions internally then we develop two plans: one hoping for the best, the other planning for the worst. With a bit of a following wind, we will hopefully be closer to the former than the latter!”

Barney Worfolk-Smith, chief growth officer, Daivid: “For a start, I’ve always felt that projecting further than one year out is a waste of time. Especially as the rate of change speeds up, causing all sorts of instability for clients. To be accurate for one year, though, I’ve just finished 25 forecasts and have done the same as always: look for spikes in the patterns of investment now and extrapolate them into next year, be brutal and check the damned spreadsheet formulae again and again.”

Darryl Sparey, managing director, Hard Numbers: “We’re fortunate that the majority of clients are retained rather than projects. So, there are four key lines we use for business planning and financial forecasting: ‘confirmed,’ which is contracted revenue, much of which has been with us for more than one planning cycle; ‘forecast,’ which is current sales pipeline that I’d bet my little finger will sign-up; ‘estimated,’ which is usually more than 90 days out from now (our deal velocity is between 60 and 90 days) and based on what has historically happened (number of net new clients from last 24 months, as an average, per month and average order value). Finally, we have ‘upside,’ the current sales pipeline that we hope will land and which, although not factored into the base case for the year, helps with capacity planning. This enables us to plan staffing levels based on our desired number of clients per staff member. I may have made this sound like a science, but there’s a lot of art and ‘gut feel,’ which needs to be applied to this.”

Rachael Marshall, founder, Magic Digits: “At Magic Digits, we’re helping around 40 independent creative services agencies plan for 2025 currently. Luckily, not all of our clients have their financial year starting in January, which does make this a little easier to manage! The most important area we can help our clients with is accurate cash flow forecasting. We look at committed client revenues, existing staff and other fixed costs to plan an accurate cash position for our clients, which enables them to plan effectively. The key thing for our clients is to enable them to stay flexible and not make significant commitments to overheads or staff costs which may provide challenges in the future. Cash flow accounts for around 80% of business failures and our ‘magicians’ are there to ensure our clients don’t add to their number.”

Expect the unexpected

Adrienn Major, founder, Pod LDN: “What I have learned since founding Pod (we started weeks before Covid) is that you can never predict anything, so this is oddly a familiar territory for us, although it has been incredibly difficult to gather learnings from past years because everything is constantly changing. We are very aware of the challenges our clients are facing and we try and adjust our services according to that. What we have found is that challenging situations are often where we thrive, as we are committed to bringing efficiency to our clients and really understanding their wider business needs. We have biweekly meetings and closely monitor our numbers; while we are in a growth phase, we are being careful with recruitment and any unnecessary spending. Instead, we are trying to stay ahead of the curve with new business development and increasing our client base.”

Tom Stone, co-founder, Re:act: “In today’s volatile environment, effective business planning and forecasting are more critical than ever. Agency leaders must embrace a flexible approach, recognizing that geopolitical tensions and economic shifts will significantly impact consumer confidence and marketing budgets. It’s essential to involve diverse voices in these discussions – particularly from finance – ensuring a well-rounded perspective on potential challenges. When estimating client spend and new business income, leveraging historical data alongside market analysis is vital. But beyond numbers, maintaining a relentless focus on delivering exceptional work and fostering genuine client relationships can set agencies apart. Agility is key; a balanced mix of permanent staff and freelancers can enhance responsiveness to changing client needs. Smaller, independent agencies often excel here, as their nimbleness allows them to pivot quickly in the face of uncertainty. Ultimately, the ability to adapt and innovate will define success in the coming year and beyond.”

Caroline Miller, managing director, Indigo Pearl: “Like a lot of sectors, the video games industry (where all our clients come from) has hit a bit of a rough patch in recent years. The big question is how long it’ll last. The overall outlook is still solid, but there have been some bumps, and we’re definitely factoring that into our plans this year – which isn’t easy! With over 20 years running an agency, I’ve become pretty good at predicting what’s ahead. Let’s be real, though – business planning is always a blend of experience, current data and a dash of optimism. Our focus is on sustainable growth, hitting our goals without burning out and keeping our clients happy with top-tier service.”

Sam Budd, CEO & founder, Buddy Media: “Business planning in an agency isn’t a one-person job. It requires a trusted leadership team with experience in both the wider agency landscape and the business itself. At the start of the financial year, we establish our overall budget through a comprehensive analysis of historical data from the last 12-14 months, as well as our new business pipeline. These forecasts are then reviewed by our leadership team before being submitted to our financial director. We then use a graded forecasting approach for our pipeline, rating growth opportunities and new business potential on a scale of 100 and updating it weekly. This provides real-time performance insights so we can adjust overheads and resources as necessary. And, of course, transparency with clients is key – having early conversations about their financial outlook helps us anticipate changes and pivot quickly to support them better.”

Chris Wakefield, sales director, Screenshot Media: “We look at our business and financial planning for the year ahead in Q4, but truthfully, planning ahead is always front of mind. The first step is speaking to our retained clients to get clarity on their plans for the coming year. Next, we review our new business pipeline and revenue for the year. We look at factors that may have affected projections, such as budget changes, external market factors or pitches lost. Our people are our most important asset. So, we’ll gather all facts and projections before plotting out things such as headcount and resourcing. An important part of the process is to stay close to the market to gauge appetite and how clients are looking to deploy budgets. We always work closely with clients to plan for key calendar moments. But recently, we’ve also seen some ad-hoc campaigns coming through the door during Q4 as clients use seasonal end-of-year campaigns to draw in new audiences.”

Scott Thaler, CMO, Gravity Global: “At Gravity Global, business planning and financial forecasting are driven by our two key values: accountability and innovation. These principles guide us to ensure that our strategies not only spark creativity but also deliver measurable results. As we often say, ‘Creativity with accountability is what drives business transformation.’ We adopt a holistic approach, involving not only the expected leadership, client services, creatives, strategists and media planners but also business analysts, trend trackers, social listening and research teams. This collaborative effort ensures we’re building solutions rooted in real-time data and evolving market conditions. By focusing on both immediate client needs and broader external factors, such as economic trends and consumer behavior, we’re able to project client spend, new business and resource allocation with precision.”

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