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61% of Independent Agencies Have a Digital Strategy, Cloud Adoption Rising

More agencies are following digital strategies and adopting customer service and cloud technologies, according to the Applied Digital Agency Survey.
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61% of independent agencies have a digital strategy, cloud adoption rising

As the industry pivots to new operating and servicing tactics following the pandemic, more agencies are creating and following digital strategies and an increasing number of agencies are adopting customer service and cloud technologies, according to the annual Applied Digital Agency Survey released last week by Applied Systems®.

The survey results found that 61% of all U.S. agencies have a digital strategy in place, with 56% of agencies focusing on implementing their strategies within one to two years—85% of agencies are focusing on implementing their strategies within one to five years.

Within agencies' digital strategies, cloud technology is sweeping across the channel. Cloud technology is how 82% of agencies host their software in 2021. Year over year these numbers continue to climb, with a 9% increase in adoption in the past year alone. Companies with revenue of more than $25 million are the least likely to use cloud software, but still maintain an adoption rate of 60%.

Meanwhile, mobile application use for employees is on the rise, the survey found. Up 13% from last year, more agencies are giving their employees easier access to essential software needed to run their businesses, like connecting to the agency management system from outside the office. Also, client self-service portals have seen steady adoption growth year over year, increasing from 33% to 36%, a 9% increase year over year.

“Last year, the industry faced the reality that it hadn't adopted the technologies to meet the digital customer service and remote business models driven by the pandemic," said Taylor Rhodes, CEO of Applied Systems.

“The latest survey results are encouraging, demonstrating that more agencies are adopting technology and recognizing the productivity, simplicity, intelligence and value that can be gained from leveraging technology in practically valuable ways," Rhodes said.

However, it is notable what technology agencies aren't using. Eighty-one percent of agencies do not use a customer relationship management (CRM) or sales automation application and 69% do not use marketing automation, the survey found. Agencies with revenue of more than $25 million are more likely to leverage these types of automation. Over two-thirds of the nation's largest agencies that took the survey use CRM or sales automation and 60% use marketing automation, while only 8% of agencies making less than $1.25 million use sales automation and 15% use marketing automation.

Additionally, only 29% of agencies are using data analytics to gain business insights from their management systems. While this adoption percentage is low, the survey said, the adoption rate has grown more than 100% since 2016 and continues to trend upward. The highest adopters of data analytics are agencies with revenue exceeding $25 million at 47%.

Will Jones is editor-in-chief.

Monday, November 22, 2021