A few years ago, much of the industry conversation around agencies centered on whether the ‘big six’ agency groups were still fit for purpose.
That conversation has moved on. It is no longer about whether media agencies remain relevant, but how they are evolving and what that means for advertisers. The answer is not simple. Agencies are transforming rapidly, reshaping their business models in response to economic pressure, technological change, a fragmenting landscape and shifting advertiser expectations.
Much of this change is being driven by the fragmentation of the media landscape. The rise of channels such as connected TV and retail media has created new opportunities for reach and targeting, but also introduced inconsistent measurement, closed ecosystems and a proliferation of platforms, each with their own data and rules. What is emerging is a more complex, less transparent, but potentially more capable ecosystem, creating both opportunity and risk for advertisers.
The most visible shift has been consolidation. The combination of major holding companies, most notably the merger between Omnicom and Interpublic Group, has created unprecedented scale in the market. This is not simply about size. It is being driven by the need to increase negotiating power with media owners and platforms, invest in data, technology and AI capabilities, and deliver more integrated services across fragmented channels.
But consolidation brings its own challenges. Integrating cultures, systems and client relationships is complex, and success will ultimately be judged on whether it improves client outcomes, not just margins. For advertisers, fewer and larger agency groups can mean greater capability and scale, but also reduced choice and the potential for conflicts of interest. Read our article exploring the implications of the Omnicom-IPG merger here.
Alongside consolidation, agency business models are evolving, with traditional fee-based structures increasingly under pressure. In their place, we are seeing early signs of outcome-based models, often enabled by AI and more advanced measurement.
In theory, this is a positive shift. Aligning compensation with business outcomes should create stronger incentives and better accountability. In practice, it raises important questions around how outcomes are defined and measured, who owns the underlying data and models, and how transparent the assumptions behind performance claims really are.
As AI becomes more embedded in planning, optimization and measurement, these questions will only become more important. The risk is not the use of AI itself, but the opacity it can introduce if effective governance is not in place, particularly while measurement frameworks remain inconsistent across channels.
Another significant shift is the growth of proprietary media and software-led services. Agencies are investing in proprietary buying models, data and identity solutions, and SaaS-style platforms for planning, activation and measurement. These offer higher margins and more scalable revenue than traditional services, and can improve efficiency and targeting. However, they also blur the line between agent and principal. Increased industry and legal scrutiny is bringing greater visibility to how these models operate and where value is created or extracted.
It is also important to recognize that much of this complexity originates upstream. Large platforms such as Google, Amazon and Meta operate closed ecosystems with limited transparency, shaping how campaigns are delivered and measured. Agencies are often building on top of these environments rather than fully controlling them.
For advertisers, the implication is not to avoid these models, but to understand them. Clarity on the role the agency plays, how pricing is structured and where incentives sit is essential in assessing whether value is being created.
At the same time, many advertisers are reassessing what they should own internally, and increasingly, the answer is control rather than execution. The conversation around in-housing is no longer about replacing agencies, but about ensuring advertisers retain ownership of how media investment works for their business. In practice, that centers on how success is defined, how performance is measured and how decisions are governed.
Without that ownership, advertisers risk becoming dependent on agency frameworks and definitions of performance, particularly as agencies build more proprietary solutions within platform-driven environments. In this context, in-housing is about owning the right things rather than doing more.
This shifts the agency relationship. Agencies are no longer the sole architects of strategy, but partners operating within clearer advertiser-led parameters. This strengthens the importance of a good client-agency relationship based on trust. You can read our in-depth post about in-housing here.
The talent within agencies is changing alongside the broader model. There is a clear shift towards hiring engineers, data scientists and product specialists, reflecting the growing importance of technology and data infrastructure in how media is planned and delivered. This also reflects the influence of large platforms, with agencies building capabilities that sit on top of platform ecosystems.
For advertisers, this has implications for how they engage with agencies and even who they recruit. The teams they work with may look and think quite differently to those of even a few years ago, with greater emphasis on technical capability alongside strategic thinking.
There is a consistent theme that underpins all of these trends: transparency. Advertisers are increasingly focused on understanding where value is created and where it may be lost. This is being driven by more complex supply chains, the growth of non-transparent trading models and increased scrutiny from procurement, finance and regulators.
While not a new priority, it is becoming more pressing as the industry evolves. It reinforces the importance of clear contractual frameworks, access to data and methodologies, and independent validation and benchmarking.
As media agencies become more technologically powered and more commercially complex, their role is expanding; at the same time, the greater integration of services, technology and trading models – as well as the smaller number of partners - can make it more difficult to switch providers. Now is the time not to retreat, but to engage with agencies in a different way.
1. Define what good looks like
As agency models evolve, advertisers need a clear view of what success means for their business, how it is measured and how partners are held accountable.
2. Understand how value is created
Not all value comes from lower costs – it can come from better outcomes, improved efficiency or access to capabilities, but it does need to be understood and proven.
3. Put the right governance in place
This includes transparency, data access and the ability to independently validate performance. Without this, complexity can quickly erode clarity and confidence.
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The future of media agencies is not about disruption in the traditional sense, but adaptation. They are becoming more capable and simultaneously more complex. For advertisers, the opportunity lies in harnessing that capability while maintaining the clarity needed to ensure that media investments are delivering real, measurable value, on their terms.
Contact our team: value@ecimm.com
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