The Challenges and Opportunities of the Digital Age

• Increased competition: The digital age has made it far easier for new competitors to enter the market, which can lead to increased competition and price pressure for existing principals. Principals must work harder to retain their market position, and incentivising their commercial agents to retain and develop goodwill with existing customers is paramount. Failure to do so is likely to result in higher rates of customer migration, resulting in lower sales and, ultimately, lower commission levels for commercial agents. This would then be reflected in an agent's compensation or indemnity entitlement pursuant to Regulation 17 upon the termination of the agency.  
• The need for digital skills: Commercial agents and principals must possess the skills necessary to operate in the digital age. These skills include social media management, digital marketing, and data analysis. This can often be a struggle for agents who have previously worked in a more manual fashion. Electronic reporting using reporting software is often an area where agents fall foul, preferring instead to continue to operate in the way they have done for many years. 
• Allegations of breach: Failing to comply with a principal's new electronic reporting requirements can result in allegations of breach, such as a breach of Regulation 3, which places a duty on an agent to comply with reasonable instructions given by their principal. It is, therefore, critical that agents develop the necessary skills to correctly utilise digital reporting software.
• Privacy and data protection: With the increased use of digital technologies comes the need to protect personal data and comply with data protection regulations such as GDPR. Principals and agents should be alert to the obligations imposed on them under the GDPR as data controllers so that they can avoid any unintentional data breaches.

In summary, the digital age presents both challenges and opportunities for commercial agents and principals in the UK.

To succeed in the digital age, commercial agents and principals must adapt to new technologies and ensure they possess digital skills, comply with data protection regulations, and innovate to meet the industry's changing needs.

The digital age also has its pitfalls and can result in an inadvertent breach of an agent's obligations pursuant to the agency agreement and the Commercial Agents Regulations if care is not taken.