Ecommerce Agency Industry Report: Trends, Statistics & Future Outlook

Here at ReferralCandy, we're excited to introduce something we've been working on: the Ecommerce Agency Industry Report!

Each month, we’re gathering information from ecommerce agencies: their results, thoughts, and predictions, and then sharing these insights in an aggregated and anonymous industry report. 

Whether you're an agency owner or just looking for more information, this report can help you get a better understanding of the state of ecommerce agencies.

The current state of ecommerce agencies: trends, statistics & outlook (2024 June)

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According to our June 2024 survey, with a steady increase in agencies' confidence in the past two months, most agencies expect their revenue to continue growing and that merchants will continue using their services. To stand out, agencies can use marketing methods that bring high ROI, such as referral programs using software like ReferralCandy.

We will now discuss our findings about ecommerce agencies in more detail.

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1. The level of confidence among ecommerce agencies was on a slight decrease, but gained momentum again in April and May

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As part of our survey, we asked ecommerce agencies to rate their confidence level from 0 to 500, which we turned into the below Ecommerce Agency Confidence Index. This index is based on aspects like how confident they’re about customer acquisition, market saturation, and changing consumer behavior.

Based on our survey, here are the overall confidence levels reported by ecommerce agencies over the past months:

As you can see from the above graph, ecommerce agencies' confidence in the state of ecommerce slightly decreased in March 2024 but picked right back up in April and May.

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2. Marketing budgets of ecommerce agency customers have shown a slight increase

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We asked ecommerce agency owners: Has there been any increase in your customer’s marketing budgets?

In May 2024, marketing budgets showed a slight increase compared to the previous 6 months, which can indicate some sort of “cautious optimism” among ecommerce merchants.

As Stefan Chiriacescu, CEO of eCommerce Today Agency, puts it:

• "As the summer started, some businesses went into "holiday" mode, opted to take a break, and cut budgets. Not our clients! For the vast majority, we have the approval to increase budgets and work on getting their sites in tip-top shape for a fantastic Q4. 2024 is looking good!"

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3. Ecommerce agency merchants are continuously willing to spend money on ecommerce apps as long as the app shows positive ROI

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We asked ecommerce agency owners: On a scale from 0 to 10, how have your customers’ budgets for investments in ecommerce apps changed?

In a nutshell, there has been no change. Investment in e-commerce apps remained relatively stable in May 2024, with only minor fluctuations from the last 6-month period.

This is one of the most consistent responses we’ve had over the months. It is evident that ecommerce agency clients are willing to spend money on ecommerce apps, provided the app provides a positive return on investment.

Jess Grossman, CEO of In Social, has a great explanation for this:

• “Our In Social clients are always looking to us to recommend apps to add to their tech stack that we feel could increase their bottom line. They look to us to make those recommendations because they know we have years of experience with a multitude of apps, we know which ones work and don’t work and how we can make them work, and we have strong partnerships with the app companies themselves. These app partnerships allow us to offer our clients an app that we have a deep understanding of to use to the client’s benefit. We have 1-1 relationships with the app teams in case we need their extra support, and we can sometimes get our clients discounts or free months! With all this in mind, our clients have always been open to installing and trying new apps because of their trust in us and our relationships with the apps, but price sensitivity has also decreased since the beginning of the year! Whereas before, clients would sit on a recommendation for a month or two or ask more questions about the cost, they are now saying, “yes let’s go for it,” much faster than before. This could be a direct result of their store’s increasing revenue thanks to our efforts, or clients feeling less worried about the economy, at this present moment. That, or they truly are trusting our recommendations more and letting us do what we do best!”

Ash Ome, CEO of MOTIF, also mentioned this:

• "Merchants are more likely to spend on ecommerce apps and tools that are going to make them either money or make operations proficient, which translates into more profits and an enjoyable work culture. We have seen merchants mostly spending money on zero-party data, AI recommendations, and loyalty apps like ReferralCandy. "

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4. Merchants price-sensitivity has remained high in May 2024 due to ongoing cost concerns

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We asked ecommerce agency owners: On a scale of 0 to 10, how would you rate the current price sensitivity of your customers towards spending on agency services?

Ecommerce merchants’ price sensitivity towards agency services remained moderately high in May 2024. This reflects ongoing cost concerns and the need for agencies to demonstrate clear value propositions compared to the merchants’ in-house teams.

Will King, Strategy Director at EastsideCo mentioned this about price sensitivity:

• "With the economic recovery, we're seeing more confidence to invest in ecommerce again. Looking ahead to the rest of 2024, there are so many opportunity areas ecommerce agencies can leverage. It's about understanding and identifying where and how you can add value to a client's business. For example, we've seen increased client demand for consultative support in areas such as analytics. Measurement and attribution have become more difficult in recent years, and this is a pain-point we can solve for clients. Knowing the specific areas where our clients need help this year enables us to promote and pitch appropriate services."

Despite most agencies reporting high price sensitivity, some agency owners, such as Michael Melen from SmartSites, mention the following:

• "Despite the economic uncertainties, we've noticed clients are less sensitive about prices for agency services. They are prioritizing value over cost."

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5. Most ecommerce agencies report that their customers' outsourcing behavior hasn’t changed

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We asked ecommerce agency owners: How likely is it that your customers will bring their marketing teams in-house rather than outsourcing work to agencies in the upcoming months?

In February 2024, there was an increase in uncertainty or diversity in predictions about clients' strategies This pessimism seems to have tamed down in April and May, with almost half of our agencies reporting no change in their customers’ outsourcing behavior.

This stability indicates that while in-house capabilities are being considered, many businesses still rely on agency expertise – which is great news.

Bogdan Mihalache, Founder & CEO Email Kong mentions that agency outsourcing still remains essential:

• "Regardless of industry shifts or advancements in AI, outsourcing will remain essential for D2C brands. Even with advanced software, brand owners want more time to focus on growth, not marketing tasks. That's the reason SaaS companies are developing better onboarding to increase product adoption and reduce churn, as brand owners often don't have time to set up a new app. My suggestion is that 6-figure brands should manage internally to reduce costs and get higher margins - with the owner wearing many hats in the beginning; 7-figure brands should always outsource to agencies. Agencies deliver more output with larger teams and optimized systems. To build a strong marketing team, brands should only go in-house at 8-figures."

Michael Melen, Co-Founder at SmartSites  also mentioned this:

• “More brands are considering in-house strategies, but the complexity of digital marketing still makes specialized agencies an attractive proposition. Some companies are switching to in-house, while others are switching back.”

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6. Most ecommerce agencies believe their revenue will continue to increase in 2024

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We asked ecommerce agency owners: On a scale of 0 to 10, how optimistic are you about your revenue increasing in the next six months? 

Agencies expect a slight increase in revenue over the next six months, meaning that agencies are preparing for better financial performance in the near future.

If we could use one adjective to describe ecommerce agencies, it would be optimistic. Agencies continue to believe that it will be a positive year for them in terms of revenue.

As Michael Melen, Co-Founder at SmartSites mentions:

• “Looking ahead, I'm optimistic about our agency's growth. The e-commerce sector continues to evolve, and we're well-positioned to capitalize on new opportunities such as influencer marketing”

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7. The majority of ecommerce agencies are optimistic about the opportunities for the next 6 months

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We asked ecommerce agency owners: On a scale of 0 to 10, how optimistic are you about the opportunities in ecommerce for the next 6 months?

To conclude the results for this question: Most ecommerce agencies see the next 6 months as an optimistic time period with new opportunities. 

This is what Tim Masek, CMO of Storetasker mentioned about the current opportunities:

• “April’s been a great month for our experts on Storetasker. Seeing a shift back towards longer-term retainers vs. one-off fixes. That’s been the storyline for us throughout 2024, but nice to see those signs of confidence staying strong (and rising) last month.”

Despite the positive outlook of most agencies, AJ Sounders from Audacious Commerce, points out that the political situation is affecting the opportunities:

• "I feel things are a little negative right now due to the political situation in the UK, USA, and EU, with major elections happening in 7 countries in 2024. I don't think companies are reducing their spending but are pausing on new campaigns or hires until these are out of the way."

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8. The importance of ecommerce agencies will continue to rise in 2024

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We believe that ecommerce agencies are the unsung heroes in the world of ecommerce. They’re the ones working closely with brands, crafting their online shopping experiences and, in many cases, doing the hard work so brands can focus on improving their products and services.

That's why their insights are pure gold. They have courtside seats to the world of ecommerce, and they see everything – the trends, the hits, and the misses.

We also believe that agencies are sometimes forgotten when it comes to analyzing the evolution of the ecommerce industry. We focus on metrics like merchandise volume and customer acquisition costs, but we never gather data about ecommerce agencies' revenue or their customers' price sensitivity to their services.

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Predicting the future ecommerce agency trends

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‍We're setting our sights high with this industry report. We're not just content with understanding today's trends; we want to get a sneak peek into tomorrow’s. The idea is to track these insights over time and start predicting where ecommerce is headed.

This isn’t just number crunching; it’s about getting a sense of the human element behind the data.

‍This index gets better with more voices joining in. It’s a community thing – the more agencies chip in, the richer and more insightful this index becomes. It acts as a growing, evolving knowledge base for all of us in the ecommerce sphere.

Some of our agency participants include: SeaMonster Studios, Swanky Agency, Thooja, Audacious Commerce, Ecommerce Today, For My People, RPF Agency, Pluro, Webcetera, SmartBug Media, Gloross, VT Labs, Motif, TatJones, Growth Heist, MageMontreal, GetVisible, StubGroup, Thooja, Gudu, TenThousandFootView and SEOWorks.

If you're an agency and would like to participate and receive the full report, you can email ReferralCandy's Partnerships Lead Raul Galera at raul [at] referralcandy.com

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