The industry will recover as demand from production studios and advertising firms rises
Los Angeles, CA (PRWEB) October 17, 2012
The image of the high-flying, hot-shot talent agent is widely held. Flush with an exorbitant share of their clients' contracts, they are untouchable, extravagant examples of the free market at work. The past five years, however, proved this industry is not entirely untouchable. The Celebrity and Sports Agents industry was negatively affected by the recession during the past five years, causing revenue to grow at an average annual rate of only 0.7% from 2007 to 2012, according to IBISWorld industry analyst Eben Jose. Fewer movies being produced by studios and lower advertising spending decreased demand for actors, models, athletes and other individuals this industry represents. However, during this period of declining demand, agents began to diversify their clientele to include individuals involved in new media who may not be part of the traditional entertainment and sports industries. For instance, modeling agencies have started to represent writers of fashion blogs.
Despite the decline during the recession, revenue increased over the past two years. In 2011, revenue rose 1.9% and it is expected to grow by 2.3% in 2012, totaling $6.8 billion, Jose says. With larger advertising expenditure by major companies and more movies and TV shows being made, agents and managers are expected to gain more revenue as their clients sign more contracts. However, profit margins will dwindle slightly as more agents enter the industry and some establishments will lower commission rates to attract clients.
In the five years to 2017, Celebrity and Sports Agents industry revenue is forecast to increase. Similar to 2011 and 2012, the demand from production studios and advertising firms is expected to rise, increasing the amount of contracts the industry negotiates and receives commission for. In addition, agencies will continue to diversify clientele and represent clients who are involved in newer media, such as video game developing.
Although industry revenue is projected to rise in the next five-year period, larger management firms and agencies are anticipated to consolidate. To expand their clientele, larger talent agencies will acquire smaller boutique firms. However, nonemploying establishments will continue to enter the market at this time, causing the number of establishments to grow overall. IBISWorld projects industry establishments to grow over the next five years. For more information, visit IBISWorld’s Celebrity and Sports Agents in the US industry page.
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IBISWorld industry Report Key Topics
This industry includes agents and managers who represent creative and performing artists, sports figures, entertainers and public figures. Agents typically focus on finding work for a client and engage in contract negotiation and management for a client, for which they are entitled to a predetermined commission. Managers have a broader role that includes contract negotiation, finding sponsorships and endorsements and other services such as career advice and financial planning.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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