Is the traditional agency model dying—and should it? Clients are ditching long-term contracts, opting for freelancers and AI for cheaper, faster solutions. Are agencies even worth saving, or are we clinging to an outdated model?

You mean the model that can only make money on the backs of overworked junior creatives? The model where an agency spends so much money on new business pitches that it needs to overcharge all of its other clients? The model, where everyone is running after ridiculous awards that are essentially bought and paid for by the clients without their consent? The model in which the most creative and compelling and innovative businesses get gobbled up by giant profit, centered, holding companies and turned into stagnant, corporate assets? Is that the model? Seems fine to me.

Can answer this piece-by-piece.

1. The traditional agency company model is dying if you’re thinking satellite offices and holding companies. independent agencies might experience turbulence but come out of this great. Why do i say this? We’ve automated away (and so will AI) the risk and reason for holding companies to exist. There aren’t back office upsides (finance, legal, partnerships) that justify a holding company relationship for a client.

2. They’re opting for freelancers because we want to pitch them a ton of media bloat that’s awesome for a book but not for a short term balance sheet. Go to a bar on a Sunday (or set up a camera of yourself for four hours on York couch), you are tuning out the most “valuable” media buy while on your phone scrolling. Learn social (and love it), learn short form, stop lobbing :60s in a deck.

Freelancers have learned to do this already. We need to learn, too.

3. Agencies are worth saving and also fixing. C-Suited need to be kept to five total people (CEO, CCO, CFO, CSO, Managing Director, Head of Production.). … Have more than that? Clients see pure bloat. We can’t spin that any longer. They justifiably want more investment in CDs, Group Strat Directors, Account Directors.

The model works. Our execution is shaky at best.

The real value prop of agencies has always been bringing an outsider perspective in to be able to present products in unexpected and engaging ways. Big data basically killed that by giving clients so many metrics to optimize messaging to - which discourages innovation and going with messaging that you don’t have solid data to back up its effectiveness with. So for the past 2 decades, agencies have mostly been in the service business, just executing the ideas that the clients data tells them will be most effective.

But clients are waking up to the fact that you don’t need an agency to do that - it’s cheaper to do in house. And for nearly everything you’d want to do outside of core messaging, there are specialized shops that do it cheaper and more efficiently- need a stunt? Go to a PR agency. Want to work with an influencer? Talk to them directly or through their agent/manager.

Traditional ad agencies are dead unless they can find new ways to add value and revenue for their clients beyond what they can make on their own with a few key hires or partnerships.

Making ads that sweep Cannes, but nobody outside the industry had ever seen ain’t it, though.

After working at traditional holding company shops with big AOR clients, I moved to a boutique shop that did project based work. It was great, we made a lot. the clients we had were presented a few ideas, they chose one, then we made it - easy.

Then we were bought by a larger holding company type place. The new clients and pitches that come in on are all still project based, but the clients don’t really treat the jobs like project based ones. They treat them more like an AOR account: the amount of constant revisions, rebriefs, swirl, ultimately deciding to do something else, etc.

That type of work is unsustainable for everyone. The agency model can’t keep affording work that ultimately doesn’t get done without the old AOR model, and clients also aren’t getting anything out of it either. If they need a partner on stand by that they can have just churn on shit all the time, we need to go back to an AOR type model. Not saying holding co’s are the way, but project based I don’t think should be the default either unless clients are ready to change.

Clients can’t make anything good because their internal politics prevents it. Agencies will always produce a better product than a client.

A better question would be agency versus consultancy. A competent client could get a consultation and then hire freelancers to execute. An upsell could be the consultancy offers agency-like services to relieve the burden from the client.

Not sure how something that’s already dead can be dying.

Not sure they’re opting for freelancers. Have you seen the freelance market?

I also think the way agencies are sourced by clients has become problematic. Having to deal with procurement or cost consultants is a major problem. If the client doesn’t see the value in the relationship then it’s destined to fail. And C-suite/holding companies NBDs who go along with it aren’t selling the value of the agency and expertise of the staff. This starts the downward spiral / race to the bottom. Pay less to employees make them do more with shorter timelines and smaller budgets.

the whole relationship is based on how cheap it is vs the value experienced agency teams provide.

Opting for freelancers you say?