Agencies in the AI Era: Between Hype and Reality (2025)

Three years have passed since AI entered our lives with quite some fanfare, and nothing about agency life feels the same anymore. But despite all the hype, AI didn’t nuke the agency business model, nor did it hand out overnight windfalls. What it did do is subtly change the dynamics of agency work. Pricing conversations sound different. Projects move faster (or are at least expected to). Hiring pauses more often. “How we do things” is under active renovation.

This article presents the main findings of our survey of 180+ agencies through five key themes: price pressure, service pricing, revenue impact, staffing, and new revenue lines — revealing what’s really happening inside agencies in 2025. The full charts and deeper cuts can be found in the downloadable report.

It’s not surprising that the age of AI has sparked requests for “AI discounts.” Clients see how easy it is to generate text or visuals and start wondering if their invoices should be lighter. Around a third of agencies in our survey have already faced this question, while nearly half expect to hear it soon.

Yet while generative AI progresses daily, nearly everyone working in intellectual services agrees: the technology is “not there yet”. Tools speed up production, but they don’t magically supply context, strategy, or taste.

As one senior account manager noted, “Clients expect to pay less because we might use AI, but the price cut they expect doesn’t reflect the reduction in human resources required to complete tasks to a high-quality standard.”

Agencies are left to bridge this gap — between the expectation of “AI doing all the work” and the human craft and judgment that still drive results. For now, most firms are succeeding at defending their value.

Let’s take a closer look at how agencies are adjusting their pricing.

AI is undeniably influencing how agencies charge for their work. In what way exactly? Well, the jury’s still out.

When asked how AI is affecting their pricing, agencies gave the most divided responses in the entire survey.

This lack of consensus is a story in itself. Agencies are experimenting, but the experiments haven’t yet converged.

Some are leaning into value- and outcome-based pricing. Others are holding steady while they collect evidence. A smaller group is competing on price. What’s consistent across the board is that leaders are getting clearer about what clients are really buying: not keystrokes, but judgment, IP, and reliability.

As Yonah C. L. van Andel, owner and managing director at the Dutch advertising agency On a Daily Basis, put it:

“I believe value-based pricing is the way forward, because with AI, anyone can generate a brand strategy in seconds. What will really be rewarded is the point of view behind the tool. That’s where experience and efficient use of time truly come into play.”

AI may not have mastered every craft, but it has unquestionably rewired creative work. Projects kick off faster, drafts land earlier, iterations multiply more easily, and teams can produce more deliverables in a week than they did a year ago.

Successful agencies are translating that new cadence into profit.

The vast majority report that AI is making a measurable difference to their bottom line — though the scale varies from one firm to another.

What’s behind the numbers? A whole lot of streamlining. And not as a buzzword, but as a stack of small, compounded changes. Agencies are finding efficiencies across the board, from administration and internal workflows to production itself.

We’ve also seen that AI is replacing some tasks that would typically be outsourced — translation, voiceovers, and similar work — cutting down on freelancer hours in the overall project balance. In general, the trend is stretching production capacity without adding headcount.

“Our 3D design team integrated AI tools into the production pipeline, which increased efficiency by three to four times,” says Jake Skoric, COO of Delta Reality, a Croatia-based XR studio. “This has reduced utilization but allows us to handle significantly more work with the same team size.”

The AI-powered profit boost isn’t about flashy reinvention just yet, but rather a measurable shift in utilization, throughput, and margin.

The mass-layoff narrative has been strong in the media in the recent past, but the data shows agencies haven’t really been hit — at least not yet.

But “no layoffs” doesn’t mean “no change.” A clear shift is underway in how agencies think about talent. Some roles aren’t as essential as they were a year ago, delaying or reducing new hires, while others are evolving.

“We’ve seen major positive impacts of AI on reducing agency admin, through note-taking style apps and follow-on automations. It’s delayed our need to hire an account manager (for now),” says Ryan Griffin, Director & Co-founder of Australian branding and digital growth agency Chunky Duck.

Across the board, AI literacy has become an imperative. Getting the most out of AI tools is no longer a curiosity or an experiment, it’s table stakes.
The short version of the layoff story: headcount is steady; responsibilities and expectations are not.

If there’s one clear theme across our research, it’s this: agencies are deep in AI trial mode. From optimizing workflows to launching new services, nearly all are looking for ways to get ahead on the AI curve.

But while many are boosting profits through efficiency, only a fraction have managed to create new, profitable revenue streams so far. The majority are still experimenting, and only a few are letting the AI wave pass them by.

While AI didn’t kill the agency business model, it’s certainly rewriting it. Rates aren’t collapsing, but there are conversations to be had about what constitutes value. Pricing models are in motion. Profit is rising for those mastering streamlining. Teams remain (mostly) intact, but are more technical, more orchestrated, more adaptable. And in the near distance, a new wave is forming: AI-forward services built for the next era of client demand.

If you want the full data, real-world agency stories, and actionable insights for navigating the AI future, it’s all in the report.