Combining aesthetics with commercialization, design agencies craft visuals such as logos, posters, and website graphics in order to communicate a brand or corporate message effectively. Creating an impressive design requires a great deal of hard work and input. This is why many design agencies partner with consultants, advertising agencies and engineers to effectively implement various types of design processes. Due to high demand from a number of business verticals, the global design agencies market is steadily growing. And with changes in content marketing strategies, analysts at Technavio predict that the market will grow at a CAGR of around 8% by 2020.
At the same time, in spite of being in high demand, design agencies are witnessing major constraints in the form of stringent government regulations, the emergence of packaged design software and the increase in crowdsourced design sites. In this blog, we provide a brief analysis of the major constraints in the industry and how they will affect the overall growth of design agencies market at the global level.
Stringent government regulations
There are, in fact, specific government regulations that apply to creative designs. China’s advertising law, for example, sets out strict guidelines for content marketing and creative design. Therefore, different regional laws and regulations across regions, industries and organizations can become constraints for design agencies.
Geographical Segmentation of the Global Design Industry (US$56 billion)
Source: Technavio
Packaged design software suites
Designing requires a strong understanding of various tools and software, as well as a great deal of creativity. Uniqueness is what differentiates one designer from the other. This is often why hiring design services results in a major cost-expenditure for an organization. Packaged design software, on the other hand, has led to both the easy availability of design and the opportunity for a number of untrained design professionals to make their way into the industry. Even though packaged software lacks the unique quality inherent in well-trained designers, a number of companies have switched to it in order to decrease the interaction between buyers and suppliers and reduce associated costs.
Crowd-sourced design sites
Apart from packaged design software suites, crowd-sourced design sites have emerged as another major challenge for design agencies. These websites are a one-stop platform where different designs can be acquired, without the need to hire external designers. Just as in the case of packaged design software, this trend of using crowd-sourced design sites has resulted in an increase of untrained / unskilled or low-skilled designers. This is causing a major issue for qualified freelance designers. A good example of a crowdsourcing site is Amazon’s Mechanical Turk.
Will all of that said, to claim that these constraints are putting a serious damper on the growth of design agencies would be a little far-fetched. In fact, with the growth of small and medium (SME) enterprises in almost all parts of the world, there has been an increased demand for design services. This is mainly because most companies aim to improve their brand identity in order to get an edge over their competitors. Another major factor that is driving the global design agency market is the fact that the world is becoming more and more connected. Now businesses are targeting both local and foreign markets, which has further fueled the demand for better designs and marketing tools.
Want to find out who made our list of leading design agencies at the global level?
Order the 2016 Procurement Market Research Report on Global Design Agencies
