LSA/SWA industry indicator 2025: advertising clients' budgets stagnate despite positive results

Despite ongoing uncertainties, 60 percent of the advertising clients surveyed expect their sales to increase in the new year. Around 26% see no change in turnover and only 13% expect a decline. They expect a similar revenue trend as in the previous year. 45% expect an increase, 35% expect no change and only 19% anticipate a decline.

2024: more sales and more earnings

Last year, 82% of advertising companies recorded either the same or higher turnover. This led to an increase for around 44% of those surveyed and to unchanged earnings for around 40%. Only around 18% of companies reported a decline in turnover and 17% in earnings.

Stagnation of communication budgets in 2025

While 51% of advertising companies do not intend to make any changes to their communication budgets, slightly fewer (21%) will increase their budgets than reduce them (28%). This trend is also confirmed by the statements on the development of media budgets.

Consistency in the marketing channels

The breakdown of the marketing and communication budget shows no surprises for 2025. Just under a third (29%) will be spent on traditional (offline) marketing, 13% on event marketing and everything else on digital channels. Social media (12%), display ads (11%), content marketing (10%) and the company's own website and search engine marketing (8% each) account for the largest budgets.

Investments in content creation, branding and sales

In 2025, advertisers want to allocate the most resources to the marketing disciplines of content/campaign creation (25 percent), brand strategy/brand building (24 percent), sales support (19 percent) and marketing operations (16 percent). All other disciplines are less in demand. Sales and Marketing Operations were up on the previous year.

Digital continues to grow - offline remains under pressure

While advertisers plan to split the media budget roughly equally between digital and offline communication, significantly more respondents (38%) want to spend more money on digital than offline (13%) in 2025. However, the proportion of those who want to invest the same amount in offline/online channels is almost the same (55%). Only 6% want to invest less in digital media in the new year, compared to 31% of respondents for offline media.

Classic dominated by OOH/DOOH, print and TV

As in the previous year, within the offline media budget, the OOH/DOOH segment is likely to benefit most from an increase (25.9%) or the same amount (42.4%) of advertising investments.

Direct marketing is also likely to see an increase (19.5%) or the same amount of investment (37.9%). For print, 45.3% of respondents want to invest the same amount, but 31.4% want to invest less and only 7% want to invest more. In contrast, the same number of customers want to invest more or less in TV (9.3%) and 25.6% do not want to make any changes. It is striking that 45% of respondents cannot afford or do not want to invest in TV, 50% in radio and 57% in cinema in 2025.

When it comes to the specific media budget distribution, OOH/DOOH (28%), print (28%) and TV (20%) are the clear top 3. Direct marketing comes in fourth place with 17.6%. All other traditional media (including radio and cinema) each account for less than 3 percent.

Video before display and search

In 2025, digital campaigns will be booked directly (50.2%) and programmatically (49.8%) in roughly equal measure. This is roughly the same as in previous years.

The most popular forms of advertising are clearly video (31.3%), followed by display (29%), search (23.2%) and native (14.2%). Video has thus taken the lead here and search has lost some ground. The distribution among individual providers was not surveyed in the current industry indicator.

Data and customer management as top challenges

Once again, there is little change in the challenges facing advertising clients in the new year. The same topics are at the top of the list as last year. Only this time, "data management" (83.5%) has taken the top spot. The other top topics are "improving customer experience" (78.8 percent), "customer journey management" (77.6 percent), "digital transformation" (73.8 percent) and "artificial intelligence" (71.8 percent).

When choosing an agency, the main focus is on recommendations

The most popular source of information for selecting an agency continues to be personal recommendations (88%) and clearly stands out from all other sources of information. Other important sources of information are the agency website/social media (49.4 percent) and contacts with agency management (48.2 percent). This is followed at a clear distance by the trade press (27.1 percent), the LSA website (25.9 percent), creative rankings (14.1 percent), the LSA ranking (14.1 percent) and the Effie Awards (3.5 percent).

Personal chemistry and culture are most important

The three most important criteria for agency selection are unchanged from the previous year:
Firstly, personal chemistry/culture (97.6 percent), secondly, understanding of the role/skills (83.5 percent) and thirdly, references (74.1 percent).

In addition, agency size (32.9%) remains a relevant criterion mentioned by clients. All other mentions such as rankings, memberships or certifications are each below 4 percent.

Chemistry Meeting as a popular evaluation tool

Chemistry meetings (39.4%) are now clearly the most frequently cited method for evaluating an agency. This is followed by the written request for proposal (25 percent), the competition presentation (20.6 percent) and the direct award (17.6 percent). The trial order (9.5 percent) or the strategy workshop (5.2 percent) are less popular.

The companies surveyed currently work with a good six agencies. Of these, 37% of advertising clients have had this relationship for over 5 years, 45.7% for 2 to 5 years and 11.1% for 1-2 years. Only 6.2% limit their collaboration to the project in question.

Agency support remains constant

Advertisers plan to invest more in the following areas at their top 3 agencies in 2025: Content (40.2 percent), Marketing Technology (32.1 percent), Brand/Communication Strategy (28.7 percent), Media Strategy (27.8 percent) and Creation (26.8 percent). Less will be spent on Live Com (34.7 percent), among other things.

Quotation and agile pricing as the most common form of remuneration

When it comes to the remuneration of agencies, the most common options are the offer and agile pricing (on a time and material basis). Percentage fees and team hire follow slightly behind. The performance-based fee model is rarely used.

Climate remains an issue

For a good third of respondents, the carbon footprint of an advertising campaign is important or very important. Another third answered neutrally with "neither" and for a further third, sustainability is less or unimportant. Nevertheless, 47 percent of the companies surveyed are already carbon-balanced.

Media providers and marketers have a duty to protect the climate

A good 35% of advertising companies believe that media providers/marketers are responsible for the climate. In this context, 23.5 percent of respondents would like to see transparency regarding the media's carbon footprint and 11.8 percent would like media providers/marketers to take on the compensation of non-reducible emissions in addition to transparency. Just under 19 percent of respondents said that agencies should calculate emissions and manage them with their customers.

A further 16.5% of companies believe that the advertising industry has no need to take action on climate change and 15.3% want to leave the issue to politicians. Only around 12% of respondents believe that advertisers should determine, reduce and offset their own CO2 emissions in advertising (including media).

Versatile use of AI

AI is penetrating numerous areas at advertising companies: Translation (82.7 percent), content creation (72.8 percent) ad creation (53.1 percent), data analysis (48.1 percent), automation (46.9 percent), programmatic advertising (34.6 percent), personalization (32.1 percent), campaign optimization (29.6 percent), social media (21 percent), predictive analytics (18.5 percent), sediment analysis (13.6 percent) and lead generation (11.1 percent).

Between October and November 2024, a total of 143 advertising clients in German- and French-speaking Switzerland took part online in the "Industry Indicator 2025" by SWA and LSA, 139 from German-speaking Switzerland, nine from the French-speaking part of Switzerland. Participants were recruited on a personal level. The aim was quality over quantity and it was crucial for meaningful answers that only people who are actually responsible for marketing communication and involved in working with the agencies receive the questionnaire. The detailed results can be obtained from the offices of both associations.