Jay Pattisall, VP, Principal Analyst

Show Notes:

Not long ago, the term “digital agency” implied something cool and cutting-edge. Brands sought out these agencies to help build and activate digital advertising or marketing campaigns that drove leads and, with them, sales. Yet a confluence of forces may now be ushering in agencies’ demise. VP and Principal Analyst Jay Pattisall explains on this week’s What It Means episode. 

Pattisall begins by explaining that the term “digital” is no longer as differentiating as it once was, as digital skills and expertise are now table stakes for marketing. AI, and now generative AI (genAI), have made some of the specialized skills that brands turned to digital agencies for more widely accessible. Consolidation within the agency landscape, meanwhile, has watered down the distinction between digital and more traditional agencies. 

The conversation then turns to the impact on agency jobs. While AI is automating some of the more technical aspects of agency work, other aspects, like critical thought and creativity, aren’t (yet) ripe for replacing. “There will be more creative jobs and skills needed in the future and fewer skills that are about repeatable work,” Pattisall says. As jobs change, he adds, so will the ways that agencies operate. While many will evolve to deliver more integrated, end-to-end solutions (particularly through mergers), others will shrink and focus on a few highly specialized services. 

Later in the episode, Pattisall discusses how the changes are affecting the way marketers choose their agency partners. The upside of consolidation (as well as, Pattisall says, a driver of it) is that marketing leaders will have fewer relationships and less complexity to manage. The episode closes with a description of how genAI will factor into how prospective clients evaluate agencies, so stay tuned for that.