Forrester predicts 15% agency job losses in 2026. Is the 'agencies as agents' era over?

"Agencies will "resign their agency" in 2026, according to predictions published today by a team led by Forrester principal analyst Jay Pattisall. Next year, the report says, the shoe will finally drop following "a decade of structural change, eroding the conventional agency approach". For decades, marketing agencies have been "singularly focused client partners," but a paradigm shift will see them "forgoing their franchise to act as agents on behalf of clients," instead becoming "marketing purveyors," Pattisall writes."

"With each consolidation, acquisition, or PE investment, marketing agencies' vision moves further away from being providers of agnostic services and creators of culture to purveyors of enterprise platforms and orchestrators of strategy and execution. Put simply, your agencies will no longer act solely as your agents but also as owners of products/solutions, resellers of technology partnerships and developers of emerging capabilities."

"A confluence of factors working together are driving this change, according to Forrester. The nexus of that change: all those factors putting pressure on how agencies charge for services, in turn pressurizing agency structures themselves. Most agencies have long relied on the time-and-materials/FTE/labor-based model, which is getting harder as margins get squeezed from several directions. First, the shift from long-running retainers to "low-margin product-based engagements" is making reliable revenues harder to come by."

2026 will bring seismic shifts that force marketing agencies to shed headcount and autonomy, transitioning from traditional client-focused partners into product and platform owners. Agencies will increasingly become owners of products/solutions, resellers of technology partnerships, and orchestrators of strategy and execution, reducing agnostic service provision. Revenue models will shift away from labor-based time-and-materials toward low-margin product engagements and media revenue, squeezing margins. Consolidation, PE investment, and in-housing commoditization will pressurize agency structures. The result will be leaner teams, greater reliance on media and technology revenues, and deep reassessment of agency business models and client relationships.

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