3 Which PESTEL factors are driving changes in the industry? Which factors are becoming more negative or positive for the major advertising agencies?This case is centred on the global advertising industry which faces significant strategic game-changing forces driven by technological innovation, the rise of consumer spending in developing economies, changes in consumer media consumption and pressures from major advertisers for results-based compensation.

In the second decade of the new millennium, advertising agencies faced a number of unanticipated challenges.

Traditional markets and industry operating methods, developed largely in North America and Western Europe following the rise of consumer spending power in the twentieth century, were being radically reappraised.

The industry was subject to game-changing forces from the so-called ‘digital revolution’ with the entry of search companies like Google, Facebook and Amazon as rivals for advertising budgets on mobile devices. Changing patterns in global consumer markets impacted on both industry dynamics and structure. Budgets being spent through traditional advertising agencies were being squeezed as industry rivalry intensified with the entry of specialist consultancies.