Will AI Kill Marketing Agencies?

If I had a nickel for every conversation I’ve had with an agency owner in the last 90 days where they asked me, “Do you think AI will kill marketing agencies?” I could retire and open a taco truck that serves my world-famous TT’s salsa, fish tacos, and margaritas.

AI isn’t going to kill marketing agencies… well, not all of them. Just the posers who define their product as their outputs: strategy decks, monthly reports, ads, social media posts, media plans, SEO, AEO, etc. If your agency defines its value by the hour or by the cost of delivered outputs, you may want to come let me show you how to make a good taco. Because you, my friend, are about to be unemployed or making a lot less money than you’d like.

This is the third part of my 3-part AI Adoption Series. If you haven’t read the first two installments, The Real Reason AI Adoption is Taking Off, and Your Team Isn’t Afraid to Adopt AI, feel free to catch up. For everyone else… read on.

Over 35 years, I’ve watched this industry go through pricing shifts, agency consolidations, and the slow death of the word “strategy” as it got stretched into meaninglessness. But what’s happening right now is a different kind of change, and if you’re running an agency, you need to quickly figure out your pathway forward.

But first, let’s just acknowledge the elephant in the room. A huge chunk of what agencies have been billing for was never the valuable part of their work. It was the work that had to happen before and after the valuable part: the first draft, the competitive landscape, the content calendar, and the research summary turned into something a client could actually read.

And then the outputs, the ads, social posts, media buys, websites, etc. That work kept agency employees busy, and clients paid for it because it created a definable product delivery they could compare (cost-wise) to your competitors and justify to their procurement peeps.

But that wasn’t where the value lived. The value lived in the insight and the ability to turn the insight into outputs that actually moved the needle. That hasn’t changed. That will NEVER change. And, spoiler alert, you can’t prompt insights, hunches, or taste because those are the product of experience and, in some cases, a crazy, beautiful mind that connects old dots in new ways to create insights, ideas, and messages that move people. I think Jobs called them the crazy ones.

There’s a reason they call it AI slop people. So let’s set aside all the doomsday talk and get serious about what agencies were, should be, and will need to be, if they’d like to stave off extinction.

What Your Clients Are Actually Paying You For (even if they don’t admit it)

The thing that’s still worth paying (a premium) for is the moment when you look at your client’s specific situation and tell them something unique and useful that they didn’t see themselves. When you give them a recommendation based on knowing the market well enough to push back on their favorite assumption. Or present a creative direction that’s driven by innovative insights instead of averaged outputs derived from some LLM training data.

Great agencies don’t produce work. They produce decisions — the kind where the wrong answer is expensive. Then they stand there and don’t blink. There’s real value in having a marketing partner that’s accountable for being right and wrong. AI isn’t accountable. Hell, unless you tell it, AI doesn’t even know the difference between right and wrong. Good and bad. Innovative and average.

And that experience, taste, accountability, and genuine insight, that’s what clients are paying for, even when they think they’re paying for the deck and the ads.

AI’s Just Putting Lipstick on a Pig

People are using AI to produce work faster, and on the surface, that work looks better than ever. Copy comes out tighter, decks are cleaner, and beautifully polished social content that used to take an afternoon gets done in twenty minutes.

The problem is that polish is not the same thing as quality.

If your insight is weak or worse, non-existent, AI will help you present that insight more efficiently. AI will certainly help you produce that insight and the various marketing outputs derived from it faster. And on the surface, that seems great. Like an improvement. Like something everyone should be running as fast as they can to get a bunch of right now!

Spoiler alert. If your thinking sucks, AI is just helping you ship weak thinking faster. But take heart, at least it will ship with better formatting. But that’s the very definition of AI putting lipstick on a pig. And in most cases, especially content marketing and social media, I’m seeing a lot more farmers and fewer and fewer artists. My apologies to pigs… I didn’t invent the analogy… but I do so love it.

Judgement and Experience Can’t be Prompted

Ok.. so AI is making it easier, faster, and cheaper to do the pre-thinking work. And it’s definitely making it faster and cheaper to produce the outputs of that thinking. Hell, if used correctly, AI can actually speed up the thinking part AND improve the quality of the thinking too. But that’s a different post, maybe one I’ll write in the future.

What you sell… what you’ve always sold is the promise of a future outcome based on incomplete information. That’s what agencies do. We analyze the inputs in light of our experience and advise the client to take actions that will produce the desired results. But tomorrow is not today, and it sure as hell isn’t yesterday or last year. We attempt to stimulate human actions in a world that changes every second of every day. And those humans… don’t even get me started. Fickle is the nicest way to describe them.

And that’s ok. Because, in a world where AI will eventually flatten the time and cost of the pre- and post-work surrounding insight creation, the real agencies, the ones filled with smart, creative, non-intuitive, beautiful, brave minds willing to stand behind their insights and ideas, will not only survive, but thrive. Because AI doesn’t remove the need for experience and judgment. It increases the penalty for not having any.

And Clients, Don’t Do Something Stupid

I get why this is tempting. If you’re a client looking at AI and realizing it can produce in minutes what you’ve been paying agencies thousands, sometimes millions, of dollars a year to create, of course, you’re going to ask the question.

Why wouldn’t we move that work to AI? You should ask it. You’d be irresponsible not to.

That’s not anti-agency. That’s your job.

But don’t confuse cutting waste with making progress.

If your agency has been selling you production dressed up as a partnership, replace them. If all they do is turn your brief into assets, tell them you’ve found a cheaper alternative. If the relationship has become a little more than an expensive assembly line with a familiar logo on the invoice, fire them. But don’t be foolish enough to think that means you don’t need an agency partner.

I’d argue you need one now more than ever. Because the real value of a great agency isn’t just the ability to make things. It’s the ability to see things, say things, and stand behind both… so you don’t have to. That’s where great agencies earn their fees.

They don’t just give you ideas. They give you permission. Permission to challenge the sacred cow before it eats another year of the budget. Permission to look at the CEO, the board, the sales team, or the founder and say, “That may be what you think, but the data and real-world experience don’t support your point of view.”

That’s not a production partner. It’s a PARTNER, and a damn valuable one.

The best agency partners bring judgment, conviction, and a spine. They stand next to you during difficult conversations. They absorb some of the heat. They say the uncomfortable thing in a way people can hear, then stay in the room to defend it, sometimes at grave risk to the very relationship they hope to keep.

AI’s not gonna do that. It can’t.

And that matters because the best agency relationships aren’t built on deliverables. They’re built on moments. Hard ones. High-risk ones. The ones that create legends or horror stories. The kind where someone you trust tells you the truth before the market does, even when it creates stress-filled conversations that just might cost them a client.

Think back on the best agency relationship you’ve ever had. I’d bet real money you can trace at least one expensive mistake you didn’t make back to one of those conversations. I’ll bet they either saved your ass from making a huge mistake, or they gave you the idea that turned out to be the breakout success you needed to catapult your career to entirely new levels.

That wasn’t a prompt. That was trusting someone who had your back and your best interests at heart in all decisions.

And I don’t see AI doing that anytime soon. But if you disagree… make your argument… I’m listening.