This week, I attended a brilliant Pimento Business Development call, and it left me reflecting on where agencies will need to be by 2026. The landscape is shifting quickly, and both procurement teams and agencies themselves are under pressure to redefine how value is created, priced, and proven.
Budgets Under Pressure
Let’s start with the obvious: marketing budgets are not going to magically expand. The prevailing trend is one of flat or shrinking spend. CFOs are demanding evidence of effectiveness and ROI at every turn. Agencies that once thrived on volume or hourly billing will find themselves challenged unless they can connect their work to tangible business outcomes. The message is clear – don’t charge by the hour, charge for the value delivered.
AI as Both Enabler and Disruptor
Artificial intelligence is no longer just about generating an image or writing copy. By 2026, AI will be embedded into search itself, with younger generations already using ChatGPT-style platforms instead of Google. This changes the game for SEO, reviews, and accreditations. It also means that websites must be AI-enabled – structured for discovery, personalised experiences, and conversational interaction.
Procurement will also use AI to benchmark agency pricing and reduce fees. If time is reduced thanks to automation, procurement will argue that fees should come down too. Agencies must be ready to counter this with a narrative about creativity, cultural insight, and human judgment — the qualities AI can’t replicate.
The Role of Procurement
From a procurement point of view, AI is a gift: more data, more benchmarking, more leverage. They will continue to press agencies on efficiency and transparency. But procurement teams also need to think carefully: strip too much value out, and agencies won’t have the incentive or resources to deliver breakthrough work. The best relationships will be built on mutual recognition that efficiency matters, but so does long-term effectiveness.
Collaboration and the Lead Agency Model
The social media ecosystem has splintered into multiple tiers of ad formats, platforms, and creative requirements. This means agencies can’t just be executors; they have to be orchestrators. Cross-agency collaboration will be vital, and with that comes the need for clear ownership and administration.
For larger projects, brands will need a lead agency to do the heavy lifting. That doesn’t mean controlling everything, but it does mean taking responsibility for coordination, strategy, and accountability. Agencies that can combine strategic contribution with operational discipline will rise above the noise.
Diversity and Talent
Another critical thread is diversity – not just in the output of campaigns, but in the ecosystem of partners. Brands are rightly asking about the agency talent balance, e.g. between North and South, women-owned businesses. Agencies that can demonstrate inclusive supply chains and diverse teams will be more attractive partners.
Meanwhile, talent must be up-skilled. Surface-level AI familiarity won’t cut it. Teams need a broad understanding of how AI works in the wider marketing space, not just how to prompt a tool. Upskilling in strategy, data, and integration will define the winning agencies of 2026.
The New Value Equation
So, where does this leave agencies? With a simple but tough challenge: prove you are worth paying for. Not by inflating capabilities you don’t have, not by hiding behind jargon, but by showing results and being transparent. The remuneration models of the future will be based on value, outcomes, and effectiveness.
By 2026, the agencies that succeed will be those that:
- Link fees to effectiveness, not hours
- Harness AI for efficiency, but prove their human judgment is irreplaceable
- Collaborate seamlessly across multi-agency ecosystems
- Champion diversity in teams and partnerships
- Invest in upskilling to stay strategically relevant
In other words: less talk, more evidence. Procurement will continue to push hard, but agencies that can combine creativity, collaboration, and clarity will remain indispensable.
Paddy Woods, Founder, Pimento Fuse added:
“On top of the strategic changes recommended, there was a real focus on the importance of building relationships and trust, not just with the client’s business, but all the other partners involved in that client’s business. This means getting to understand every element of their business across their value chain.”
Thanks to Paddy Woods, Tina Fegent and Simon Moore for a great call. For full conversation, see here: YouTube channel here.